Epa HQ Oar 2005 0029 0197

Tuesday,
June 29, 2004
Part II
Environmental
Protection Agency
40 CFR Parts 9, 69, et al.
Control of Emissions of Air Pollution
From Nonroad Diesel Engines and Fuel;
Final Rule
38958 Federal Register / Vol. 69, No. 124 / Tuesday, June 29, 2004 / Rules and Regulations
ENVIRONMENTAL PROTECTION these devices are damaged by sulfur. in the index, some information is not
AGENCY These fuel controls will be phased-in publicly available, i.e., CBI or other
starting in mid-2007. Today’s nonroad information whose disclosure is
40 CFR Parts 9, 69, 80, 86, 89, 94, 1039, final rule is largely based on the restricted by statute. Certain other
1048, 1051, 1065, and 1068 Environmental Protection Agency’s material, such as copyrighted material,
[OAR–2003–0012; FRL–7662–4] 2007 highway diesel program. is not placed on the Internet and will be
To better ensure the benefits of the publicly available only in hard copy
RIN 2060–AK27 standards are realized in-use and form. Publicly available docket
throughout the useful life of these materials are available either
Control of Emissions of Air Pollution engines, we are also adopting new test electronically in EDOCKET or in hard
From Nonroad Diesel Engines and Fuel procedures, including not-to-exceed copy at the Air Docket in the EPA
AGENCY: Environmental Protection requirements, and related certification Docket Center, EPA/DC, EPA West,
Agency (EPA). requirements. The rule also includes Room B102, 1301 Constitution Ave.,
ACTION: Final rule. provisions to facilitate the transition to NW, Washington, DC. The Public
the new engine and fuel standards and Reading Room is open from 8:30 a.m. to
SUMMARY: Nonroad diesel engines to encourage the early introduction of 4:30 p.m., Monday through Friday,
contribute considerably to our nation’s clean technologies and clean nonroad excluding legal holidays. The telephone
air pollution. These engines, used diesel fuel. We have also developed number for the Public Reading Room is
primarily in construction, agricultural, provisions for both the engine and fuel (202) 566–1744, and the telephone
and industrial applications, are programs designed to address small number for the Air Docket is (202) 566–
projected to continue to contribute large business considerations. 1742.
amounts of particulate matter, nitrogen The requirements in this rule will
oxides, and sulfur oxides, all of which FOR FURTHER INFORMATION CONTACT:
result in substantial benefits to public
contribute to serious public health health and welfare through significant Carol Connell, Assessment and
problems in the United States. These reductions in emissions of nitrogen Standards Division, Office of
problems include premature mortality, oxides and particulate matter, as well as Transportation and Air Quality,
aggravation of respiratory and nonmethane hydrocarbons, carbon Environmental Protection Agency, 2000
cardiovascular disease, aggravation of monoxide, sulfur oxides, and air toxics. Traverwood Drive, Ann Arbor, MI
existing asthma, acute respiratory We are now projecting that by 2030, this 48105; telephone number: (734) 214–
symptoms, chronic bronchitis, and program will reduce annual emissions 4349; fax number: (734) 214–4050; e-
decreased lung function. We believe of nitrogen oxides and particulate mail address: connell.carol@epa.gov, or
that diesel exhaust is likely to be matter by 738,000 and 129,000 tons, Assessment and Standards Division
carcinogenic to humans by inhalation. respectively. These emission reductions Hotline; telephone number: (734) 214–
Today, EPA is adopting new emission will prevent 12,000 premature deaths, 4636; e-mail address: asdinfo@epa.gov.
standards for nonroad diesel engines over 8,900 hospitalizations, and almost SUPPLEMENTARY INFORMATION:
and sulfur reductions in nonroad diesel a million work days lost, and will
fuel that will dramatically reduce achieve other quantifiable benefits every Does This Action Apply To Me?
harmful emissions and will directly year. The total benefits of this rule will
help States and local areas recently This action may affect you if you
be approximately $80 billion annually produce or import new diesel engines
designated as 8-hour ozone
by 2030. The substantial health and which are intended for use in nonroad
nonattainment areas to improve their air
welfare benefits we are projecting for vehicles or equipment, such as
quality. This comprehensive national
this final action exceed those we agricultural and construction
program regulates nonroad diesel
anticipated at the time of this proposal. equipment, or if you produce or import
engines and diesel fuel as a system. New
Costs for both the engine and fuel such nonroad vehicles or equipment. It
engine standards will begin to take
requirements will be many times less, at may also affect you if you convert
effect in the 2008 model year, phasing
approximately $2 billion annually. nonroad vehicles or equipment, or the
in over a number of years. These
standards are based on the use of DATES: This final rule is effective on engines used in them, to use alternative
advanced exhaust emission control August 30, 2004. fuels. It may also affect you if you
devices. We estimate particulate matter The incorporation by reference of produce, import, distribute, or sell
reductions of 95 percent, nitrogen certain publications listed in this nonroad diesel fuel.
oxides reductions of 90 percent, and the regulation is approved by the Director of The following table gives some
virtual elimination of sulfur oxides from the Federal Register as of August 30, examples of entities that may have to
nonroad engines meeting the new 2004. follow the regulations. But because
standards. Nonroad diesel fuel sulfur ADDRESSES: EPA has established a these are only examples, you should
reductions of more than 99 percent from docket for this action under Docket ID carefully examine the regulations in 40
existing levels will provide significant Nos. OAR–2003–0012 and A–2001–28. CFR parts 80, 89, 1039, 1065, and 1068.
health benefits as well as facilitate the All documents in the docket are listed If you have questions, call the person
introduction of high-efficiency catalytic in the EDOCKET index at http:// listed in the FOR FURTHER INFORMATION
exhaust emission control devices as www.epa.gov/edocket. Although listed CONTACT section of this preamble:
NAICS SIC
Category Examples of potentially regulated entities
codesa codesb
Industry ............................................. 333618 3519 Manufacturers of new nonroad diesel engines.

Industry ............................................. 333111 3523 Manufacturers of farm machinery and equipment.
Industry ............................................. 333112 3524 Manufacturers of lawn and garden tractors (home).
Industry ............................................. 333924 3537 Manufacturers of industrial trucks.
Industry ............................................. 333120 3531 Manufacturers of construction machinery.
Federal Register / Vol. 69, No. 124 / Tuesday, June 29, 2004 / Rules and Regulations 38959
NAICS SIC
Category Examples of potentially regulated entities
codesa codesb
Industry ............................................. 333131 3532 Manufacturers of mining machinery and equipment.

Industry ............................................. 333132 3533 Manufacturers of oil and gas field machinery and equipment.
Industry ............................................. 811112 7533 Commercial importers of vehicles and vehicle components.
811198 7549
Industry ............................................. 324110 2911 Petroleum refiners.
Industry ............................................. 422710 5171 Diesel fuel marketers and distributors.
422720 5172
Industry ............................................. 484220 4212 Diesel fuel carriers.
484230 4213
Notes:
a North American Industry Classification System (NAICS).
b Standard Industrial Classification (SIC) system code.
How Can I Get Copies of This Outline of This Preamble B. Additional Requirements for Refiners
Document and Other Related I. Overview and Importers
Information? A. What Is EPA Finalizing? C. Requirements for Parties Downstream of
B. Why Is EPA Taking This Action? the Refinery or Import Facility
Docket. EPA has established an II. Nonroad Engine Standards D. Diesel Fuel Sulfur Sampling and Testing
official public docket for this action A. What Are the New Engine Standards? Requirements
under Docket ID No. OAR–2003–0012 at B. Are the New Standards Feasible? E. Selection of the Marker for Heating Oil
http://www.epa.gov/edocket. The C. Why Do We Need 15ppm Sulfur Diesel
F. Fuel Marker Test Method
G. Requirements for Record-keeping,
official public docket consists of the Fuel?
Reporting, and PTDs

documents specifically referenced in III. Requirements for Engine and Equipment
H. Liability and Penalty Provisions for

this action, any public comments Manufacturers
Noncompliance
received, and other information related A. Averaging, Banking, and Trading
I. How Will Compliance With the Sulfur

B. Transition Provisions for Equipment
to this action. Although a part of the Manufacturers
Standards Be Determined?
official docket, the public docket does VI. Program Costs and Benefits
C. Engine and Equipment Small Business
not include Confidential Business A. Refining and Distribution Costs
Provisions (SBREFA)
Information (CBI) or other information B. Cost Savings to the Existing Fleet From
D. Certification Fuel
the Use of Low Sulfur Fuel

whose disclosure is restricted by statute. E. Temporary In-Use Compliance Margins
C. Engine and Equipment Cost Impacts
The official public docket is the F. Test Cycles

D. Annual Costs and Cost Per Ton
collection of materials that is available G. Other Test Procedure Issues

E. Do the Benefits Outweigh the Costs of
for public viewing at the Air Docket in H. Engine Power

the Standards?
the EPA Docket Center, (EPA/DC) EPA I. Auxiliary Emission Control Devices and
F. Economic Impact Analysis
Defeat Devices VII. Alternative Program Options Considered
West, Room B102, 1301 Constitution J. Not-To-Exceed Requirements
Ave., NW, Washington, DC. The EPA A. Summary of Alternatives
K. Investigating and Reporting Emission-
B. Introduction of 15 ppm Nonroad Diesel
Docket Center Public Reading Room is Related Defects
Sulfur Fuel in One Step
open from 8:30 a.m. to 4:30 p.m., L. Compliance With the Phase-In
C. Applying the 15 ppm Sulfur Cap to
Monday through Friday, excluding legal Provisions
Locomotive and Marine Diesel Fuel
holidays. The telephone number for the M. Incentive Program for Early or Very
D. Other Alternatives
Reading Room is (202) 566–1742, and Low Emission Engines
VIII. Future Plans
the telephone number for the Air Docket N. Labeling and Notification Requirements
A. Technology Review
is (202) 566–1742. O. General Compliance B. Test Procedure Issues
P. Other Issues C. In-use Testing
Electronic Access. You may access Q. Highway Engines

this Federal Register document D. Engine Diagnostics
R. Changes That Affect Other Engine

E. Future NOX Standards for Engines in
electronically through the EPA Internet Categories

Mobile Machinery Over 750 hp
under the ‘‘Federal Register’’ listings at IV. Our Program for Controlling Nonroad,
F. Emission Standards for Locomotive and
http://www.epa.gov/fedrgstr/. Locomotive and Marine Diesel Fuel Marine Diesel Engines
An electronic version of the public Sulfur G. Retrofit Programs
docket is available through EPA’s A. Nonroad, Locomotive and Marine Diesel H. Reassess the Marker Specified for
electronic public docket and comment Fuel Quality Standards Heating Oil
system, EPA Dockets. You may use EPA B. Hardship Relief Provisions for IX. Public Participation
Qualifying Refiners X. Statutory and Executive Order Reviews
Dockets at http://www.epa.gov/edocket/ C. Special Provisions for Alaska and the A. Executive Order 12866: Regulatory
to view public comments, access the Territories Planning and Review
index listing of the contents of the D. NRLM Diesel Fuel Program Design B. Paperwork Reduction Act
official public docket, and to access E. How Are State Diesel Fuel Programs C. Regulatory Flexibility Act (RFA), as
those documents in the public docket Affected by the Sulfur Diesel Program? amended by the Small Business
that are available electronically. F. Technological Feasibility of the 500 and Regulatory Enforcement Fairness Act of
Although not all docket materials may 15 ppm Sulfur Diesel Fuel Program 1996 (SBREFA), 5 U.S.C. 601 et. seq
be available electronically, you may still G. What Are the Potential Impacts of the D. Unfunded Mandates Reform Act
access any of the publicly available 15 ppm Sulfur Diesel Program on E. Executive Order 13132: Federalism
Lubricity and Other Fuel Properties? F. Executive Order 13175: Consultation
docket materials through the docket H. Refinery Air Permitting and Coordination With Indian Tribal
facility identified above. Once in the V. Nonroad, Locomotive and Marine Diesel Governments
system, select ‘‘search,’’ then key in the Fuel Program: Details of the Compliance G. Executive Order 13045: Protection of
appropriate docket identification and Enforcement Provisions Children from Environmental Health and
number. A. Special Fuel Provisions and Exemptions Safety Risks
H. Executive Order 13211: Actions That rule for public health and welfare hearings on the proposal and have
Significantly Affect Energy Supply, improvements are greater than participated in scores of meetings with
Distribution, or Use estimated at proposal. commenters in developing the
I. National Technology Transfer This final rule sets out emission
Advancement Act
provisions of today’s final rule. An
J. Congressional Review Act
standards for nonroad diesel engines— important aspect of this collaborative
XI. Statutory Provisions and Legal Authority engines used mainly in construction, development effort has been EPA’s
agricultural, industrial and mining coordination with other governments in
I. Overview operations—that will achieve reductions helping to further world harmonization
in PM and NOX emissions levels in of nonroad engine controls and fuel
EPA today is completing the third
excess of 95 percent and 90 percent sulfur levels. Information gathered in
recent major program to reduce
respectively. This action also regulates these comments and discussions, taken
emissions from the nation’s mobile
nonroad diesel fuel for the first time by in context with the principles described
sources. Today’s final rule establishes
reducing sulfur levels in this fuel more above, has been the basis for our action
standards for nonroad diesel engines
than 99 percent to 15 parts per million today.
and fuel and builds on the recently
(ppm). These provisions mirror those In summary, this rule sets out engine
adopted Tier 2 program for cars and
already in place for highway diesel standards and emission test procedures
light trucks and the 2007 highway diesel
engines, which will lead to the (including not-to-exceed requirements)
program for on-highway diesel engines.
introduction of 15 ppm sulfur diesel for new nonroad diesel engines, and
These three programs have in common
fuel, followed by stringent engine sulfur control requirements for diesel
large reductions in sulfur levels in fuel
standards in that sector beginning in fuel used in land-based nonroad,
that will not only achieve public health 2007 based on advanced aftertreatment locomotive, and marine engines (NRLM
benefits but also facilitate the technologies. We believe it is highly
introduction of advanced emissions fuel). Beginning in 2008, the new Tier
appropriate to bring the same types of 4 engine standards for five power
control technologies. In 1996, emissions expected advanced aftertreatment
from land-based nonroad, marine, and categories for engines from under 25
technologies to the nonroad market as horsepower (hp) to above 750
locomotive diesel engines were soon as possible and we believe today’s
estimated to be about 40 percent of the horsepower will be phased in. New
nonroad fuel and engine program engine emissions test procedures will be
total mobile source inventory of PM2.5 represents the next step in a feasible
(particulate matter less than 2.5 microns phased in along with these new
progression in the application of clean standards to better ensure emissions
in diameter) and 25 percent of the NOX technologies to nonroad diesel engines
(nitrogen oxides) inventory. Without control over real-world engine operation
and the associated diesel fuel. and to help provide for effective
today’s final rule, these contributions As we did with the proposed nonroad
would be expected to grow to 44 percent compliance determination. The sulfur
rulemaking, we followed specific
and 47 percent by 2030 for PM2.5 and reductions to land-based nonroad diesel
principles when developing this final
NOX, respectively. By themselves, land- fuel will be accomplished in two steps,
rule. First, the program achieves
based nonroad diesel engines are a very with an interim step from currently
reductions in NOX, sulfur oxides (SOX),
large part of the diesel mobile source uncontrolled levels to a 500 ppm cap
and PM emissions as early as possible.
PM2.5 inventory, contributing about 47 starting in June, 2007 and the final step
Second, it does so by implementing the
percent in 1996, and growing to 70 to 15 ppm in June, 2010. This change in
fuel program as soon as possible while
percent of this inventory by 2020 fuel quality will directly lead to
at the same time not interfering with the
without today’s final rule. In order to important health and welfare benefits
implementation and expected benefits
meet the Clean Air Act’s goal of associated with the reduced generation
of introducing ultra low sulfur fuel
cleaning up the nation’s air, emissions (diesel fuel containing no greater than of sulfate PM and SOX. Even more
reductions from the nonroad sector are 15 ppm sulfur) in the highway market important, introduction of 15 ppm
necessary. as required by the 2007 highway diesel sulfur nonroad diesel fuel facilitates the
This program begins to get important rule. Next, we are generally treating introduction of advanced aftertreatment
emission reductions in 2008, and by vehicles and fuels as a system, that is devices for nonroad engines.
2030 we estimate that this program will promulgating engine and fuel standards Although we did not propose to
reduce over 129,000 tons PM2.5 and in tandem in order to cost-effectively control locomotive and marine diesel
738,000 tons of NOX annually. These achieve the greatest emission fuel sulfur levels to 15 ppm in the
emission reductions will be directly reductions. Lastly, the program provides NPRM, recognizing the important
helpful to the 474 counties nationwide sufficient lead time to allow the environmental and public welfare
that have been recently designated as migration of advanced emissions control benefits that such a program could
nonattainment areas for the 8-hour technologies from the highway sector to enable, we have decided to finalize this
ozone standard and for counties that nonroad diesel engines as well as the second step to 15 ppm sulfur fuel
will be designated as nonattainment for expansion of ultra low sulfur diesel fuel control program for locomotive and
PM2.5 later this year. The resulting production to the nonroad market. marine diesel fuel beginning in 2012.
ambient PM2.5 and NOX reductions The May 2003 proposed rulemaking Locomotive and marine diesel fuel will
correspond to public health culminated a multi-year effort to first be reduced from current
improvements in 2030 including develop control strategies for nonroad uncontrolled levels to a 500 ppm cap
approximately 12,000 fewer premature engines. EPA worked collaboratively starting in June 2007 and the second
mortalities, 15,000 fewer heart attacks, 1 with stakeholders from industry, state step down to a 15 ppm cap will take
million fewer lost days of work due to and local government, and public health place in June, 2012. While we have
adults with respiratory symptoms, 5.9 organizations in putting together its chosen to reduce sulfur levels in
million fewer days when adults have to comprehensive (and widely praised) locomotive and marine diesel fuel to 15
restrict their activities due to respiratory new engine standards and sulfur fuel ppm in this rulemaking without
symptoms, and almost 6,000 emergency controls. We received about 150,000 adopting corresponding engine controls,
room visits for asthma attacks in comments on the proposal, almost all of we note that the Agency has already
children. Our projections in this final them in support. We held three public begun work to promulgate appropriate
new standards for these engines.1 The 1. Nonroad Diesel Engine Emission be addressed in a future action (we are
monetized health and welfare benefits Standards currently considering such an action in
associated with further sulfur reduction Today’s action adopts Tier 4 the 2007 time frame).
to 15 ppm outweigh the costs of the standards for nonroad diesel engines of We are also continuing the averaging,
sulfur reductions. Also, doing so now all horsepower ratings. These standards banking, and trading provisions engine
allows for the promulgation of a single are technology-neutral in the sense that manufacturers can use to demonstrate
integrated fuel program and provides manufacturers are the responsible party compliance with the standards. We also
the refining industry with long term in determining which emission control are continuing provisions providing
technologies will be needed to meet the flexibilities which equipment
predictability for sulfur control.
requirements. Applicable emissions manufacturers may use to facilitate
The requirements in this rule will transition to compliance with the new
result in substantial benefits to public standards are determined by model year
standards. In addition, we are including
health and welfare and the environment for each of five engine power band
turbocharged diesels in the existing
categories. For engines less than 25 hp,
through significant reductions in NOX regulation of crankcase emissions,
we are adopting a new engine standard
and PM as well as nonmethane effective in the same year that the new
for PM of 0.30 g/bhp-hr (grams per
hydrocarbons (NMHC), carbon standards first apply in each power
brake-horsepower-hour) beginning in
monoxide (CO), SOX, and air toxics. As category.
2008, and leaving the previously-set 5.6 As discussed at length in the
noted, by 2030 this program will reduce g/bhp-hr combined standard for
annual emissions of NOX and PM by proposal, new test procedures and
NMHC+NOX in place. For engines of 25 compliance provisions, especially the
738,000 and 129,000 tons, respectively. to 75 hp, we are adopting standards
We estimate these annual emission not-to-exceed and transient tests, are
reflecting approximately 50 percent necessary to ensure the benefits of the
reductions will prevent 12,000 reductions in PM control from today’s
premature deaths, over 8,900 standards being adopted today are
engines, again applicable beginning in achieved when the aftertreatment-based
hospitalizations, 15,000 nonfatal heart 2008. Then, starting in 2013, standards standards go into place. We are
attacks, and approximately 1 million of 0.02 g/bhp-hr for PM and 3.5 g/bhp therefore adopting the proposed test
days that people miss work because of hr for NMHC+NOX will apply for this procedures and compliance provisions,
respiratory symptoms, among power category. For engines of 75 to 175 with slight modifications designed to
quantifiable benefits. The overall hp, the standards will be 0.01 g/bhp-hr better implement the provisions, in
quantifiable benefits will total $83 for PM, 0.30 g/bhp-hr for NOX and 0.14 today’s rule. We continue to believe the
billion annually by 2030 using a 3 g/bhp-hr for NMHC starting in 2012, new transient test, cold start transient
percent discount rate and $78 billion with the NOX and NMHC standards test, and not-to-exceed test procedures
using a 7 percent discount rate at a cost phased in over a period of three to four and standards will all help achieve our
of approximately $2 billion, with a 30- years in order to address lead time, goal of emissions reductions being
year net present value for the benefits of workload, and feasibility achieved in actual engine operation.
$805 billion at 3 percent discounting considerations. These same standards As noted, the final rule also
and $352 billion at 7 percent will apply to engines of 175 to 750 hp continues, and in some cases modifies,
discounting at a net present value cost as well starting in 2011, with a similar existing provisions that will facilitate
of $27 billion at 3 percent discounting phase-in. These PM, NOX, and NMHC the transition to the new engine and fuel
and $14 billion at 7 percent discounting. standards and phase-in schedules are standards. Many of these provisions will
Clearly the benefits of this program similar in stringency to the 2007 help small business engine and
dramatically outweigh its cost at a ratio highway diesel standards and are equipment manufacturers meet the
of approximately 40:1 in 2030. expected to require the use of high- requirements. They will also aid
efficiency aftertreatment systems to manufacturers in managing their
A. What Is EPA Finalizing? ensure compliance. development of engines and equipment
For engines above 750 hp, we are that will meet our new standards.
As part of the proposed rulemaking, requiring PM and NMHC control to
we set out very detailed provisions for 0.075 g/bhp-hr and 0.30 g/bhp-hr, 2. Nonroad, Locomotive, and Marine
new engine exhaust emission controls, respectively, starting in 2011. More Diesel Fuel Quality Standards
sulfur limitations in nonroad and stringent standards take effect in 2015 The fuel program requirements are
locomotive/marine diesel fuels, test with PM standards of 0.02 g/bhp-hr (for very similar to those included in the
procedures, compliance requirements, engines used in generator sets) and 0.03 proposal, with two notable exceptions.
and other information. We also looked g/bhp-hr (for non-generator set engines), The first involves the standards
at a number of alternative program and an NMHC standard of 0.14 g/bhp themselves with the inclusion of
options, such as requiring refiners to hr. The NOX standard in 2011 will be locomotive and marine diesel fuel in the
reduce sulfur from uncontrolled levels 0.50 g/bhp-hr for generator set engines 15 ppm standard. The second addresses
to 15 ppm in one step in 2008. We above 1200 hp, and 2.6 g/bhp-hr for all the compliance provisions designed to
continue to believe that the main other engines in the above 750 hp ensure the effectiveness of the program.
program options set out in the proposal category. This application of advanced We are adopting the two-step
are feasible and the most cost-effective NOX emission control technologies to approach to sulfur control, with all
requirements, taking into account other generator set engines above 1200 hp will land-based nonroad, locomotive, and
factors such as lead time and interaction provide substantial NOX reductions and marine diesel fuel going from
with the highway diesel program, so we will occur earlier than we had proposed uncontrolled sulfur levels of
are generally adopting the engine and in the NPRM. In 2015, the 750–1200 hp approximately 3,000 ppm sulfur to 500
fuel provisions which we proposed. generator set engines will be added to ppm in June, 2007. The interim step
the stringent 0.50 g/bhp-hr NOX will by itself achieve significant PM and
1 EPA is issuing an Advanced Notice of Proposed requirement as well. The long-term NOX SOX emission reductions with
Rulemaking for locomotive and marine engine standard for engines not used in associated important health benefits as
standards as part of this effort. generator sets (mobile machinery) will early as is practicable. Then, in June
2010, the sulfur cap for land-based mechanism we discussed in the PM NAAQS and meeting regional haze
nonroad engine diesel fuel will be proposal, a ‘‘designate and track’’ type goals in our treasured national parks.
reduced to the final standard of 15 ppm. approach, is better suited to address our SOX levels can themselves pose a
Two years later, in 2012, the 15 ppm priorities and commitments for the respiratory hazard.
cap for locomotive and marine engine nonroad diesel sulfur control program. Although controlling air pollution
diesel fuel will go into effect. The This approach allows refiners to from nonroad diesel exhaust is
reduction to 15 ppm sulfur provides designate volumes of nonroad fuel into challenging, we strongly believe it can
additional direct control of PM and SOX various categories and these be accomplished through the
emissions and is an enabling technology designations would follow the fuel application of high-efficiency emissions
for the application of advanced catalyst- throughout the distribution system. We control technologies. As discussed in
based emission control technologies. have successfully worked through our much greater detail in section II, very
Although we did not propose to enforceability and other concerns with large emission reductions (in excess of
control locomotive and marine diesel this approach and are now including it 90 percent) are possible, especially
fuel to 15 ppm in the NPRM, after as our compliance mechanism for the through the use of catalytic emission
careful consideration and reviewing fuel standards of today’s program. control devices installed in the nonroad
substantial comments from equipment’s exhaust system and
stakeholders, we have decided to B. Why Is EPA Taking This Action? integrated with the engine controls. To
include fuel used in locomotive and As we have discussed extensively in meet the standards being adopted today,
marine applications in the final step to both the proposal and today’s action, application of such technologies for
15 ppm beginning in 2012. The EPA strongly believes it is appropriate both PM and NOX control will be
incremental PM health and welfare to take steps now to reduce future needed for most engines. High-
benefits associated with this standard emissions from nonroad, locomotive, efficiency PM exhaust emission control
outweigh the costs. The locomotive and and marine diesel engines. Emissions technology has been available for
marine diesel fuel program provides a from these engines contribute greatly to several years, and it is the same
near-term positive impact on public a number of serious air pollution technology we expect to be applied to
health and welfare. Also, the 15 ppm problems and would continue to do so meet the PM standards for highway
sulfur diesel fuel provides an in the future absent further reduction diesel engines in 2007. For NOX, we
opportunity that may enable the measures. Such emissions lead to expect the same high-efficiency
application of advanced catalyst-based adverse health and welfare effects technologies being developed for the
emission control technologies to associated with ozone, PM, NOX, SOX, 2007 highway diesel engine program
locomotive and marine diesel engines. and volatile organic compounds, will be used to meet our new nonroad
We are issuing an Advance Notice of including toxic compounds. In addition, requirements. All of these technologies
Proposed Rulemaking for locomotive diesel exhaust is of specific concern are dependent on the 15 ppm maximum
and marine diesel engines that because it is likely to be carcinogenic to sulfur levels for nonroad diesel fuel
investigates this potential. Recognizing humans by inhalation as well as posing being adopted today. The fuel control
the value that a locomotive and marine a hazard from noncancer respiratory program being adopted today also yields
fuel program could have for public effects. Ozone, NOX, and PM also cause significant and important reductions in
health and welfare, State and local significant public welfare harm such as SOX from these sources.
authorities and public health advocacy damage to crops, eutrophication,
regional haze, and soiling of building 1. Basis for Action Under the Clean Air
organizations provided a large number
materials. Act
of comments encouraging us to take
action in this rulemaking to address Millions of Americans continue to Section 213 of the Clean Air Act (‘‘the
emissions from this category. live in areas with unhealthy air quality Act’’ or CAA) gives us the authority to
Including locomotive and marine fuel that may endanger public health and establish emissions standards for
in the 15 ppm sulfur diesel fuel pool welfare. As discussed in more detail nonroad engines and vehicles. Section
also simplifies the overall design of the below, there are approximately 159 213(a)(3) authorizes the Administrator
fuel program and will simplify the million people living in areas that either to set standards for NOX, volatile
distribution of diesel fuel. At the same do not meet the 8-hour ozone National organic compounds (VOCs), and CO
time, we have finalized this standard Ambient Air Quality Standards which ‘‘standards shall achieve the
with flexibilities designed specifically (NAAQS) or contribute to violations in greatest degree of emission reduction
to address fuel program implementation other counties as noted in EPA’s recent achievable through the application of
issues raised in the comments. nonattainment designations for part or technology which the Administrator
Noting that sulfur levels in highway all of 474 counties. In addition, determines will be available for the
diesel fuel will generally be at or below approximately 65 million people live in engines or vehicles.’’ As part of this
15 ppm starting in 2006 and not counties where air quality determination, the Administrator must
wanting to reduce the benefits of measurements violate the PM2.5 give appropriate consideration to cost,
introducing this clean fuel, we spent NAAQS. These numbers do not include lead time, noise, energy, and safety
considerable time developing a the tens of millions of people living in factors associated with the application
compliance assurance scheme for areas where there is a significant future of such technology. The standards
introducing our nonroad diesel sulfur risk of failing to maintain or achieve the adopted today for NOX implement this
program to mesh with the highway ozone or PM2.5 NAAQS. Federal, state, provision. Section 213(a)(4) authorizes
program requirements. We initially and local governments are working to the Administrator to establish standards
thought that a ‘‘baseline’’ approach bring ozone and PM levels into to control emissions of pollutants (other
essentially requiring refiners to compliance with the NAAQS attainment than those covered by section 213(a)(3))
maintain a constraint on sulfur levels of and maintenance plans and the which ‘‘may reasonably be anticipated
various distillate fuels, based on reductions included in today’s rule will to endanger public health and welfare.’’
historical production volumes, was the play a critical part in these actions. Here, the Administrator may promulgate
most appropriate mechanism. Reducing regional emissions of SOX is regulations that are deemed appropriate
Subsequently we learned that the other critical to this strategy for attaining the for new nonroad vehicles and engines
which cause or contribute to such air effects. Moreover, these compounds reasonably may be anticipated to
pollution, taking into account costs, have the potential to cause health effects endanger public health or welfare, or (2)
noise, safety, and energy factors. EPA at environmental levels of exposure. will impair to a significant degree the
believes the new controls for PM in Third, emissions from nonroad diesel performance of any emission control
today’s rule are an appropriate exercise engines (including locomotive and device or system which is in general
of EPA’s discretion under the authority marine diesel engines) contribute to use, or which the Administrator finds
of section 213(a)(4). regional haze and impaired visibility has been developed to a point where in
We believe the evidence provided in across the nation, as well as to odor, a reasonable time it will be in general
section II of this preamble and in the acid deposition, polycyclic organic use were such a regulation to be
Regulatory Impact Analysis (RIA) matter (POM) deposition, promulgated. This rule meets both of
indicates that the stringent emission eutrophication and nitrification, all of these criteria. Sulfur dioxide (SO2)and
standards adopted today are feasible which are serious environmental sulfate PM emissions from nonroad,
and reflect the greatest degree of welfare problems. locomotive, marine and diesel vehicles
emission reduction achievable in the EPA has already found in previous are due to sulfur in diesel fuel. As
model years to which they apply. We rules that emissions from new nonroad discussed above, emissions of these
have given appropriate consideration to diesel engines contribute to ozone and pollutants cause or contribute to
costs in promulgating these standards. CO concentrations in more than one ambient levels of air pollution that
Our review of the costs and cost- area which has failed to attain the ozone endanger public health and welfare.
effectiveness of these standards indicate and CO NAAQS (59 FR 31306, June 17, Control of sulfur to 15 ppm for this fuel
that they will be reasonable and 1994). EPA has also previously through a two-step program would lead
comparable to the cost-effectiveness of determined that it is appropriate to to significant, cost-effective reductions
other emission reduction strategies for establish standards for PM from new in emissions of these pollutants. Control
the same pollutants that have been nonroad diesel engines under section of sulfur to 15 ppm in nonroad diesel
required or could be required in the 213(a)(4), and the additional fuel will also enable emissions control
future. We have also reviewed and given information on diesel exhaust technology that will achieve significant,
appropriate consideration to the energy carcinogenicity noted above reinforces cost-effective reduction in emissions of
factors of this rule in terms of fuel this finding. In addition, we have these pollutants, as discussed in section
efficiency and effects on diesel fuel already found that emissions from I.B.2 below. The substantial adverse
supply, production, and distribution, as nonroad engines significantly contribute effect of high sulfur levels on the
discussed below, as well as any safety to air pollution that may reasonably be performance of diesel emission control
factors associated with these new anticipated to endanger public welfare devices or systems that would be
standards. due to regional haze and visibility expected to be used to meet the nonroad
The information in this section and impairment (67 FR 68242–68243, Nov. standards is discussed in detail in
chapters 2 and 3 of the RIA regarding air 8, 2002). We find here, based on the section II. Control of sulfur to 15 ppm
quality and the contribution of nonroad, information in this section of the for locomotive and marine diesel fuel,
locomotive, and marine diesel engines preamble and chapters 2 and 3 of the as with nonroad diesel fuel, will
to air pollution provides strong RIA, that emissions from the new provide meaningful additional benefits
evidence that emissions from such nonroad diesel engines covered by this that outweigh the costs. In addition, our
engines significantly and adversely final action likewise contribute to authority under section 211(c) is
impact public health or welfare. First, as regional haze and to visibility
discussed in more detail in Appendix A
noted earlier, there is a significant risk impairment that may reasonably be
to chapter 5 of the RIA.
that several areas will fail to attain or anticipated to endanger public welfare.
maintain compliance with the NAAQS Taken together, these findings indicate 2. What Is the Air Quality Impact of
for 8-hour ozone concentrations or the the appropriateness of the nonroad This Final Rule?
NAAQS for PM2.5 during the period that diesel engine standards adopted today a. Public Health and Environmental
these new vehicle and engine standards for purposes of section 213(a)(3) and (4) Impacts
will be phased into the vehicle of the Act. These findings were
population, and that nonroad, unchallenged by commenters. With this rulemaking, we are acting to
locomotive, and marine diesel engines These standards must take effect at extend advanced emission controls to
contribute to such concentrations, as ‘‘the earliest possible date considering another major source of diesel engine
well as to concentrations of other the lead time necessary to permit emissions: Nonroad land-based diesel
criteria pollutants. This risk will be development and application of the engines. This final rule sets out
significantly reduced by the standards requisite technology,’’ giving emission standards for nonroad land-
adopted today, as also noted above. ‘‘appropriate consideration’’ to cost, based diesel engines—engines used
However, the evidence indicates that energy, and safety.2 The compliance mainly in construction, agricultural,
some risk remains even after the dates we are adopting reflect careful industrial and mining operations—that
reductions achieved by these new consideration of these factors. The will achieve reductions in PM and NOX
controls on nonroad diesel engines and averaging, banking, and trading (ABT), standards in excess of 95 percent and 90
nonroad, locomotive, and marine diesel equipment manufacturer flexibilities, percent, respectively for this class of
fuel. Second, EPA believes that diesel and phase-in provisions for NOX are vehicles. This action also regulates
exhaust is likely to be carcinogenic to elements in our determination that we nonroad diesel fuel for the first time by
humans. The risk associated with have selected appropriate lead times for reducing sulfur levels in this fuel more
exposure to diesel exhaust includes the the standards. than 99 percent to 15 ppm. The diesel
particulate and gaseous components Section 211(c) of the CAA allows us fuel sulfur requirements will decrease
among which are benzene, to regulate fuels where emission PM and SO2 emissions for land-based
formaldehyde, acetaldehyde, acrolein, products of the fuel either: (1) Cause or diesel engines, as well as for three other
and 1,3–butadiene, all of which are contribute to air pollution that nonroad source categories: Commercial
known or suspected human or animal marine diesel vessels, locomotives, and
carcinogens, or have noncancer health 2 See Clean Air Act section 213(b). recreational marine diesel engines.
These sources are significant information in the preamble, RIA, and likely to continue to persist in the future
contributors to atmospheric pollution of support documents for the proposed in the absence of additional controls
(among other pollutants) PM, ozone and rule. and that the emission reductions would
a variety of toxic air pollutants. In 1996, When fully implemented, this final assist areas with attainment and future
emissions from these four source rule will reduce nonroad (equipment maintenance of the PM and ozone
categories were estimated to be 40 such as construction, agricultural, and NAAQS.3 For example, in 2020, based
percent of the mobile source inventory industrial), diesel PM2.5 and NOX on emission controls currently adopted,
for PM2.5 and 25 percent for NOX, and emissions by 95 percent and 90 percent, we project that 66 million people will
10 percent and 13 percent of overall respectively. It will also virtually live in 79 counties with average PM2.5
emissions for these potential health eliminate nonroad diesel SO2 emissions, levels above 15 micrograms per cubic
hazards, respectively. Without further which amounted to approximately meter (ug/m3). In 2030, the number of
controls beyond those we have already 234,000 tons in 1996, and would people projected to live in areas
adopted, these sources will emit 44 otherwise grow to approximately exceeding the PM2.5 standard is
percent of PM2.5 from mobile sources 326,000 tons by 2020. These dramatic expected to increase to 85 million in
and 47 percent of NOX emissions from reductions in nonroad emissions are a 107 counties. An additional 24 million
mobile sources by the year 2030. critical part of the effort by federal, state people are projected to live in counties
Nonroad engines, and most and local governments to reduce the within 10 percent of the standard in
importantly nonroad diesel engines, health related impacts of air pollution 2020, which will increase to 64 million
contribute significantly to ambient and to reach attainment of the NAAQS people in 2030. Furthermore, for ozone,
PM2.5 levels, largely through direct for PM and ozone, as well as to improve in 2020, based on emission controls
emissions of carbonaceous and sulfate other environmental effects such as currently adopted, the number of
particles in the fine (and even ultrafine) atmospheric visibility. Based on the counties violating the 8-hour ozone
size range. Nonroad diesels also most recent data available for this rule, standard is expected to decrease to 30
currently emit high levels of NOX which such problems are widespread in the counties where 43 million people are
react in the atmosphere to form United States. There are almost 65 projected to live. Thereafter, exposure to
secondary PM2.5 (namely ammonium million people living in 120 counties unhealthy levels of ozone is expected to
nitrate) as well as ozone. Nonroad with monitored PM2.5 levels (2000– begin to increase again. In 2030 the
diesels also emit SO2 and hydrocarbons 2002) exceeding the PM2.5 NAAQS, and number of counties violating the 8-hour
which react in the atmosphere to form 159 million people living in areas ozone NAAQS is projected to increase
secondary PM2.5 (namely sulfates and recently designated as exceeding 8-hour to 32 counties where 47 million people
organic carbonaceous PM2.5). This ozone NAAQS. Figure I–1 illustrates the are projected to live. In addition, in
section summarizes key points widespread nature of these problems. 2030, 82 counties where 44 million
regarding the nonroad diesel engine Shown in this figure are counties people are projected to live will be
contribution to these pollutants and exceeding the PM2.5 NAAQS or within 10 percent of violating the ozone
their impacts on human health and the designated for nonattainment with the 8-hour NAAQS.
environment. EPA notes that we are 8-hour ozone NAAQS plus mandatory BILLING CODE 6560–50–P
relying not only on the information Federal Class I areas, which have
presented in this preamble, but also on particular needs for reductions in 3 Note this analysis does not include the effects
atmospheric haze. of the proposed Rule to Reduce Interstate Transport

the more detailed information in of Fine Particulate Matter and Ozone (Interstate Air
chapters 2 and 3 of the RIA and Our air quality modeling also Quality Rule). 69 FR 4566 (January 30, 2004). See
technical support documents, as well as indicates that similar conditions are http://www.epa.gov/interstateairquality/rule.html.
EPA is still developing the their comments on the proposal, states Furthermore, this action would ensure
implementation process for bringing the told EPA that they need nonroad diesel that nonroad diesel emissions will
nation’s air into attainment with the engine reductions in order to be able to continue to decrease as the fleet turns
PM2.5 and 8-hour ozone NAAQS. Based meet and maintain the PM2.5 and ozone over in the years beyond 2014; these
on section 172(a) provisions in the Act, NAAQS as well as to make progress reductions will be important for
designated areas will need to attain the toward visibility requirements.4 maintenance of the NAAQS following
PM2.5 NAAQS in the 2010 (based on attainment.
2007–2009 air quality data) to 2015 4 The following are sample comments from states
(based on 2012 to 2014 air quality data) and state associations on the proposed rule, which Scientific studies show ambient PM is
corroborate that this rule is a critical element in associated with a series of adverse
time frame, and then be required to States’ NAAQS attainment efforts. Fuller
maintain the NAAQS thereafter. information can be found in the Summary and
health effects. These health effects are
Similarly, we expect that most areas Analysis of Comments. discussed in detail in the EPA Criteria
covered under subpart 1 and 2 will —‘‘Unless emissions from nonroad diesels are Document for PM as well as the draft
sharply reduced, it is very likely that many areas updates of this document released in the
attain the ozone standard in the 2007 to of the country will be unable to attain and maintain
2014 time frame, depending on an area’s health-based NAAQS for ozone and PM.’’
classification and other factors, and then (STAPPA/ALAPCO)
be required to maintain the NAAQS —‘‘Adoption of the proposed regulation * * * is
necessary for the protection of public health in
thereafter. California and to comply with air quality standards
Since the emission reductions * * * The need for 15 ppm sulfur diesel fuel
expected from this final rule would cannot be overstated.’’ (California Air Resources
Board) —‘‘Attainment of the NAAQS for ozone and PM2.5
begin in this same time frame, the is of immediate concern to the states in the
projected reductions in nonroad —‘‘The EPA’s proposed regulation is necessary if
the West is to make reasonable progress towards northeast region.* * * Thus, programs * * * such
emissions would be used by states in improving visibility in our nation’s Class I areas.’’ as the proposed rule for nonroad diesel engines are
meeting the PM2.5 and ozone NAAQS. In (Western Regional Air Partnership (WRAP)) essential.’’ (NESCAUM)
past year.5, 6 EPA’s ‘‘Health Assessment specific influence of mobile source- effects observed in larger-scale
Document for Diesel Engine Exhaust,’’ related PM2.5 on daily mortality and a epidemiologic studies. Recent studies
(the ‘‘Diesel HAD’’) also reviews health concentration-response function for conducted in Los Angeles have
effects information related to diesel mobile source-associated PM2.5 and illustrated that a substantial increase in
exhaust as a whole including diesel PM, daily mortality. Another recent study in the concentration of ultrafine particles
which is one component of ambient 14 U.S. cities examining the effect of is evident in locations near roadways,
PM.7 In the Diesel HAD, we note that PM10 (particulate matter less than 10 indicating substantial differences in the
the particulate characteristics in the microns in diameter) on daily hospital nature of PM immediately near mobile
zone around nonroad diesel engines are admissions for cardiovascular disease source emissions.14 For additional
likely to be substantially the same as found that the effect of PM10 was information on health effects, see the
published air quality measurements significantly greater in areas with a RIA.
made along busy roadways. This larger proportion of PM10 coming from In addition to its contribution to
conclusion supports the relevance of motor vehicles, indicating that PM10 ambient PM concentrations, diesel
health effects associated with highway from these sources may have a greater exhaust is of specific concern because it
diesel engine-generated PM to nonroad effect on the toxicity of ambient PM10 has been judged to pose a lung cancer
applications. when compared with other sources.10 hazard for humans as well as a hazard
As described in these documents, Of particular relevance to this rule is from noncancer respiratory effects. In
health effects associated with short-term a recent cohort study which examined this context, diesel exhaust PM is
variation in ambient PM have been the association between mortality and generally used as a surrogate measure
indicated by epidemiologic studies residential proximity to major roads in for diesel exhaust. Further, nonroad
showing associations between exposure the Netherlands. Examining a cohort of diesel engine emissions also contain
and increased hospital admissions for 55 to 69 year-olds from 1986 to 1994, several substances known or suspected
ischemic heart disease, heart failure, the study indicated that long-term as human or animal carcinogens, or that
respiratory disease, including chronic residence near major roads, an index of have noncancer health effects as
obstructive pulmonary disease (COPD) exposure to primary mobile source described in the Diesel HAD. Moreover,
and pneumonia. Short-term elevations emissions (including diesel exhaust), these compounds have the potential to
in ambient PM have also been was significantly associated with cause health effects at environmental
associated with increased cough, lower increased cardiopulmonary mortality.11 levels of exposure. These other
respiratory symptoms, and decrements Other studies have shown children compounds include benzene, 1,3-
in lung function. Additional studies living near roads with high truck traffic butadiene, formaldehyde, acetaldehyde,
have associated changes in heart rate density have decreased lung function acrolein, dioxin, and POM. For some of
and/or heart rhythm in addition to and greater prevalence of lower these pollutants, nonroad diesel engine
changes in blood characteristics with respiratory symptoms compared to emissions are believed to account for a
exposure to ambient PM. Short-term children living on other roads.12 A significant proportion of total nation-
variations in ambient PM have also been recent review of epidemiologic studies wide emissions. All of these compounds
associated with increases in total and examining associations between asthma were identified as national or regional
cardiorespiratory mortality. Studies and roadway proximity concluded that ‘‘risk drivers’’ in the 1996 NATA.15 That
examining populations exposed to some coherence was evident in the is, these compounds pose a significant
different levels of air pollution over a literature, indicating that asthma, lung portion of the total inhalation cancer
number of years, including the Harvard function decrement, respiratory risk to a significant portion of the
Six Cities Study and the American symptoms, and other respiratory population. Mobile sources contribute
Cancer Society Study, suggest an problems appear to occur more significantly to total emissions of these
association between long-term exposure frequently in people living near busy air toxics. As discussed in more detail
to ambient PM2.5 and premature roads.13 As discussed later, nonroad in the RIA, this final rulemaking will
mortality, including deaths attributed to diesel engine emissions, especially result in significant reductions of these
lung cancer.8, 9 Two studies further particulate, are similar in composition emissions.
analyzing the Harvard Six Cities Study’s to those from highway diesel vehicles. In EPA’s Diesel HAD.16 diesel exhaust
air quality data have also established a Although difficult to associate directly was classified as likely to be
with PM2.5, these studies indicate that carcinogenic to humans by inhalation at
5 U.S. EPA (1996.) Air Quality Criteria for
direct emissions from mobile sources, environmental exposures, in accordance
Particulate Matter—Volumes I, II, and III, EPA,
Office of Research and Development. Report No.
and diesel engines specifically, may with the revised draft 1996/1999 EPA
EPA/600/P–95/001a–cF. This material is available explain a portion of respiratory health cancer guidelines. A number of other
electronically at http://www.epa.gov/ttn/oarpg/ agencies (National Institute for
ticd.html. 10 Janssen, NA; Schwartz J; Zanobetti A; et al.
Occupational Safety and Health, the
6 U.S. EPA (2003). Air Quality Criteria for (2002) Air conditioning and source-specific
Particulate Matter—Volumes I and II (Fourth particles as modifiers of the effect of PM10 on
International Agency for Research on
External Review Draft) This material is available hospital admissions for heart and lung disease. Cancer, the World Health Organization,
electronically at http://cfpub.epa.gov/ncea/cfm/ Environ Health Perspect 110(1):43–49.
partmatt.cfm. 11 Hoek, G; Brunekreef, B; Goldbohm, S; et al. 14 Yifang Zhu, William C. Hinds, Seongheon Kim,
7 U.S. EPA (2002). Health Assessment Document (2002) Association between mortality and Si Shen and Constantinos Sioutas Zhu Y; Hinds
for Diesel Engine Exhaust. EPA/600/8–90/057F indicators of traffic-related air pollution in the WC; Kim S; et al. (2002) Study of ultrafine particles
Office of Research and Development, Washington, Netherlands: a cohort study. Lancet near a major highway with heavy-duty diesel traffic.
DC. This document is available electronically at 360(9341):1203–1209. Atmos Environ 36(27): 4323–4335.
http://cfpub.epa.gov/ncea/cfm/ 12 Brunekreef, B; Janssen NA; de Hartog, J; et al. 15 U.S. EPA (2002). National-Scale Air Toxics
recordisplay.cfm?deid=29060. (1997) Air pollution from traffic and lung function Assessment. This material is available
8 Dockery, DW; Pope, CA, III; Xu, X; et al. (1993) in children living near motor ways. Epidemiology electronically at http://www.epa.gov/ttn/atw/nata/.
An association between air pollution and mortality (8): 298–303. 16 U.S. EPA (2002). Health Assessment Document
in six U.S. cities. N Engl J Med 329:1753–1759. 13 Delfino RJ. (2002) Epidemiologic evidence for for Diesel Engine Exhaust. EPA/600/8–90/057F
9 Pope, CA, III; Burnett, RT; Calle, EE; et al. (2002) asthma and exposure to air toxics: linkages between Office of Research and Development, Washington
Lung cancer, cardiopulmonary mortality, and long- occupational, indoor, and community air pollution DC. This document is available electronically at
term exposure to fine particulate air pollution. research. Env Health Perspect Suppl 110(4): 573– http://cfpub.epa.gov/ncea/cfm/
JAMA 287: 1132–1141. 589. recordisplay.cfm?deid=29060.
California EPA, and the U.S. chest.17, 18 Ozone can reduce lung part of the ongoing review of the air
Department of Health and Human function and make it more difficult to quality criteria and NAAQS for ozone.
Services) have made similar breathe deeply, and breathing may A revised Air Quality Criteria Document
classifications. become more rapid and shallow than for Ozone and Other Photochemical
EPA generally derives cancer unit risk normal, thereby limiting a person’s Oxidants will be prepared in
estimates to calculate population risk normal activity. Ozone also can consultation with EPA’s Clean Air
more precisely from exposure to aggravate asthma, leading to more Science Advisory Committee (CASAC).
carcinogens. In the simplest terms, the asthma attacks that require a doctor’s Key new health information falls into
cancer unit risk is the increased risk attention and/or the use of additional four general areas: Development of new-
associated with average lifetime medication. In addition, ozone can onset asthma, hospital admissions for
exposure of 1 ug/m3. EPA concluded in inflame and damage the lining of the young children, school absence rate,
the Diesel HAD that it is not possible lungs, which may lead to permanent and premature mortality. In all, the new
currently to calculate a cancer unit risk changes in lung tissue, irreversible studies that have become available since
for diesel exhaust due to a variety of reductions in lung function, and a lower the 8-hour ozone standard was adopted
factors that limit the current studies, quality of life if the inflammation occurs in 1997 continue to demonstrate the
such as lack of an adequate dose- repeatedly over a long time period harmful effects of ozone on public
response relationship between exposure (months, years, a lifetime). People who health and the need for areas with high
and cancer incidence. are of particular concern with respect to ozone levels to attain and maintain the
However, in the absence of a cancer ozone exposures include children and NAAQS.
unit risk, the EPA Diesel HAD sought to adults who are active outdoors. Those Finally, nonroad diesel emissions
provide additional insight into the people particularly susceptible to ozone contribute to nine categories of non-
significance of the cancer hazard by effects are people with respiratory health impacts: visibility impairment,
estimating possible ranges of risk that disease, such as asthma, and people soiling and material damage, acid
might be present in the population. The with unusual sensitivity to ozone, and deposition, eutrophication of water
possible risk range analysis was children. Beyond its human health bodies, plant and ecosystem damage
developed by comparing a typical effects, ozone has been shown to injure from ozone, water pollution resulting
environmental exposure level for plants, which has the effect of reducing from deposition of toxic air pollutants
highway diesel sources to a selected crop yields and reducing productivity in with resulting effects on fish and
range of occupational exposure levels forest ecosystems.19, 20 wildlife, and odor. In particular, EPA
and then proportionally scaling the New research suggests additional determined that nonroad engines
occupationally observed risks according serious health effects beyond those that contribute significantly to unacceptable
to the exposure ratios to obtain an were known when the 8-hour ozone visibility conditions where people live,
estimate of the possible environmental health standard was set. Since 1997, work and recreate, including
risk. A number of calculations are over 1,700 new health and welfare contributing to visibility impairment in
needed to accomplish this, and these studies relating to ozone have been Federally mandated Class I areas that
can be seen in the EPA Diesel HAD. The published in peer-reviewed journals.21 are given special emphasis in the Clean
outcome was that environmental risks Many of these studies investigate the Air Act (67 FR 68242, November 8,
from diesel exhaust exposure could impact of ozone exposure on such 2002). Visibility is impaired by fine PM
range from a low of 10¥4 to 10¥5 or be health effects as changes in lung and precursor emissions from nonroad
as high as 10¥3 this being a reflection structure and biochemistry, diesel engines subject to this final rule.
of the range of occupational exposures inflammation of the lungs, exacerbation Reductions in emissions from this final
that could be associated with the and causation of asthma, respiratory rule will improve visibility as well as
relative and absolute risk levels illness-related school absence, hospital other environmental outcomes as
observed in the occupational studies. and emergency room visits for asthma described in the RIA.
Because of uncertainties, the analysis and other respiratory causes, and As supplementary information, we
acknowledged that the risks could be premature mortality. EPA is currently have made estimates using air quality
lower than 10¥4 or 10¥5 and a zero risk evaluating these and other studies as modeling to illustrate the types of
from diesel exhaust exposure was not change in future PM2.5 and ozone levels
ruled out. Although the above risk range 17 U.S. EPA (1996). Air Quality Criteria for Ozone that we would expect to result from a
is based on environmental exposure and Related Photochemical Oxidants, EPA/600/P– final rule like this as described in
levels for highway mobile sources only, 93/004aF. Docket No. A–99–06. Document Nos. II– chapter 2 of the RIA. That modeling
A–15 to 17.
the 1996 NATA estimated exposure for 18 U.S. EPA (1996). Review of National Ambient
shows that control of nonroad emissions
nonroad diesel sources as well. Thus, Air Quality Standards for Ozone, Assessment of
would produce nationwide air quality
the exposure estimates were somewhat Scientific and Technical Information, OAQPS Staff improvements in PM2.5 and ozone levels
higher than those used in the risk range Paper, EPA–452/R–96–007. Docket No. A–99–06. as well as visibility improvements. On
analysis described above. The EPA Document No. II–A–22. a population-weighted basis, the average
19 U.S. EPA (1996). Air Quality Criteria for Ozone
Diesel HAD, therefore, stated that the modeled change in future-year PM2.5
and Related Photochemical Oxidants, EPA/600/P–
NATA exposure estimates result in a 93/004aF. Docket No. A–99–06. Document Nos. II– annual averages is projected to decrease
similar risk perspective. A–15 to 17. by 0.42 µg/m3 (3.3%) in 2020, and 0.59
The ozone precursor reductions 20 U.S. EPA (1996). Review of National Ambient µg/m3 (0.6%) in 2030. In addition, the
expected as a result of this rule are also Air Quality Standards for Ozone, Assessment of population-weighted average modeled
important because of health and welfare Scientific and Technical Information, OAQPS Staff
Paper, EPA–452/R–96–007. Docket No. A–99–06.
change in future year design values for
effects associated with ozone, as Document No. II–A–22. ozone would decrease by 1.8 parts per
described in the Air Quality Criteria 21 New Ozone Health and Environmental Effects billion (ppb) in 2020, and 2.5 ppb in
Document for Ozone and Other References, Published Since Completion of the 2030. Within areas predicted to violate
Photochemical Oxidants. Ozone can Previous Ozone AQCD, National Center for the ozone NAAQS in the projected base
Environmental Assessment, Office of Research and
irritate the respiratory system, causing Development, U.S. Environmental Protection
case, the average decrease would be
coughing, throat irritation, and/or Agency, Research Triangle Park, NC 27711 (7/2002) somewhat higher: 1.9 ppb in 2020 and
uncomfortable sensation in the Docket No. A–2001–28, Document II–A–79. 3.0 ppb in 2030.
The PM air quality improvements work due to their respiratory symptoms, for land-based nonroad diesel
expected from this final rule are and 5.9 million fewer days when adults engines. 22 For locomotive, commercial
anticipated to produce major benefits to have to restrict their activities due to marine vessel (CMV), and recreational
human health and welfare, with a respiratory symptoms. The reductions marine vessel (RMV) engines, the final
combined value in excess of half a will also improve visibility and reduce fuel standards will affect direct PM2.5
trillion dollars between 2007 and 2030. diesel odor. For further details on the and SO2 emissions. Each sub-section
For example, in 2030, we estimate that economic benefits of this rule, please below discusses one of these
this program will reduce approximately refer to the benefit-cost discussion in pollutants,23 including expected
129,000 tons PM2.5 and 738,000 tons of section VI of this preamble and chapter emission reductions associated with the
NOX. The resulting ambient PM 9 of the RIA. final standards.24 Table I.B–1
reductions correspond to public health
b. Emissions From Nonroad Diesel summarizes the impacts of this rule for
improvements in 2030, including 12,000
Engines 2020 and 2030. Further details on our
fewer premature mortalities, 15,000
fewer heart attacks, 200,000 fewer The engine and fuel standards in this inventory estimates, including results
asthma exacerbations in children, and 1 final rule will affect emissions of direct for other years, are available in chapter
million fewer days when adults miss PM2.5, SO2, NOX, VOCs, and air toxics 3 of the RIA.
TABLE I.B–1.—ESTIMATED NATIONAL (50 STATE) REDUCTIONS IN EMISSIONS FROM NONROAD LAND-BASED,
LOCOMOTIVE, COMMERCIAL MARINE, AND RECREATIONAL MARINE DIESEL ENGINES
Pollutant [short tons] 2020 2030
Direct PM2.5:
PM2.5 Emissions Without Rule ................................................................................................................................. 167,000 181,000
PM2.5 Emissions With 500 ppm Sulfur in 2007 and No Other Controls .................................................................. 144,000 155,000
PM2.5 Emissions With 15 ppm Sulfur in 2012 and No Other Controls .................................................................... 141,000 152,000
PM2.5 Emissions With Entire Rule ............................................................................................................................ 81,000 52,000
PM2.5 Reductions Resulting from this Rule .............................................................................................................. 86,000 129,000
SO2:
SO2 Emissions Without Rule .................................................................................................................................... 326,000 379,000
SO2 Emisions With 500 ppm Sulfur in 2007 ............................................................................................................ 37,000 43,000
SO2 Emissions With Entire Rule (15 ppm Sulfur in 2012) ...................................................................................... 3,000 3,000
SO2 Reductions Resulting from this Rule ................................................................................................................ 323,000 376,000
NOX—Land-Based Nonroad Engines Onlya:
NOX Emissions Without Rule ................................................................................................................................... 1,125,000 1,199,000
NOX Emissions With Rule ........................................................................................................................................ 681,000 461,000
NOX Reductions Resulting from this Rule ............................................................................................................... 444,000 738,000
VOC—Land-Based Nonroad Engines Onlya:
VOC Emissions Without Rule .................................................................................................................................. 98,000 97,000
VOC Emissions With Rule ....................................................................................................................................... 75,000 63,000
VOC Reductions Resulting from this Rule ............................................................................................................... 23,000 34,000
Notes:
a NO and VOC numbers only include emissions for land-based nonroad diesel engines because the Tier 4 controls will not be applied to loco-
X
motive, commercial marine, and recreational marine engines; and no NOX and VOC emission reductions are generated through the lowering of
fuel sulfur levels.
i. Direct PM2.5 a 50 state inventory are shown in table emissions estimates with the final rule,
As described earlier, the Agency I.B–1, along with our estimates of the emissions estimates based on lowering
believes that reductions of diesel PM2.5 reductions in 2020 and 2030 we expect diesel fuel sulfur without any other
emissions are needed as part of the would result from our final rule for a controls are shown in table I.B–1 for
nation’s progress toward clean air. PM2.5 exhaust emission standard and 2020 and 2030.
Direct PM2.5 emissions from land-based from changes in the sulfur level in land- Figure I.B–1a shows our estimate of
nonroad diesel engines amount to based nonroad, locomotive, and marine PM2.5 emissions between 2000 and 2030
increasingly large percentages of total diesel fuel. Land-based nonroad, both without and with the final
man-made diesel PM2.5. Between 1996 locomotive, and marine diesel fuel standards and fuel sulfur requirements
and 2030, we estimate that the sulfur levels will be lowered to about of this rule. We estimate that PM2.5
percentage of total man-made diesel 340 ppm in-use (500 ppm maximum) in emissions from this source would be
PM2.5 emissions coming from land- 2007. Land-based nonroad diesel fuel reduced by 71 percent in 2030.
based nonroad diesel engines will sulfur will be lowered further to about
ii. SO2
increase from about 46 percent to 72 11 ppm in-use (15 ppm maximum) in
percent (based on a 48 state inventory). 2010 and locomotive and marine diesel We estimate that land-based nonroad,
Emissions of direct PM2.5 from land- fuel sulfur will be lowered to the same CMV, RMV, and locomotive diesel
based nonroad diesel engines based on level in 2012. In addition to PM2.5 engines emitted about 234,000 tons of
22 We are also adopting a few minor adjustments locomotive, and commercial marine vessel diesel the inventory, we use a 48 state emissions
of a technical nature to current CO standards. engines are based on 50 state emissions inventory inventory, to match the 48 state nature of those
Emissions effects from these standards are estimates. A 48 state inventory was used for air other inventories.
discussed in the RIA. quality modeling that EPA conducted for this rule, 24 Please see the Summary and Analyses of
23 The estimates of baseline emissions and of which Alaska and Hawaii are not a part. In cases Comments document for discussions of issues
emissions reductions from the final rule reported where land-based nonroad diesel engine emissions raised about the emission inventory estimates
here for nonroad land-based, recreational marine, are compared with non-mobile source portions of during the comment period for the NPRM.
SO2 in 1996, accounting for about 33 iii. NOX iv. VOCs and Air Toxics
percent of the SO2 from mobile sources Based on a 48 state emissions
(based on a 48 state inventory). With no Table I.B–1 shows the 50 state
estimated tonnage of NOX emissions for inventory, we estimate that land-based
reduction in diesel fuel sulfur levels, we nonroad diesel engines emitted over 221
estimate that these emissions will 2020 and 2030 without the final rule
and the estimated tonnage of emissions thousand tons of VOC in 1996. Between
continue to increase, accounting for 1996 and 2030, we estimate that land-
about 44 percent of mobile source SO2 eliminated with the final rule in place.
based nonroad diesel engines will
emissions by 2030. These results are shown graphically in
contribute about 2 to 3 percent of
Figure I.E–1c at the end of this section. mobile source VOC emissions. Without
As part of this final rule, sulfur levels We estimate that NOX emissions from
in fuel will be significantly reduced, further controls, land-based nonroad
these engines will be reduced by 62 diesel engines will emit about 97
leading to large reductions in nonroad, percent in 2030.
locomotive, and marine diesel SO2 thousand tons/year of VOC in 2020 and
emissions. By 2007, the sulfur in diesel We note that the magnitude of NOX 2030 nationally.
fuel used by all land-based nonroad, reductions determined in the final rule Table I.B–1 shows our projection of
locomotive, and marine diesel engines analysis is somewhat less than what was the reductions in 2020 and 2030 for
reported in the proposal’s preamble and VOC emissions that we expect from
will be reduced from the current average
RIA, especially in the later years when implementing the final NMHC
in-use level of between 2,300 to 2,400
the fleet has mostly turned over to Tier standards. This estimate is based on a
ppm 25 to an average in-use level of 50 state emissions inventory. By 2030,
about 340 ppm, with a maximum level 4 designs. The greater part of this is due
to the fact that we have deferred setting VOC emissions from this category
of 500 ppm. By 2010, the sulfur in would be reduced by 35 percent from
diesel fuel used by land-based nonroad a long-term NOX standard for mobile
machinery over 750 horsepower to a baseline levels.
engines will be reduced to an average While we are not adopting any
in-use level of 11 ppm with a maximum later action. When this future action is
completed, we would expect roughly specific gaseous air toxics standards in
level of 15 ppm. Sulfur in diesel fuel today’s rule, air toxics emissions would
used by locomotive and marine engines equivalent reductions between the
nonetheless be significantly reduced
will be reduced to the same level by proposal and the overall final program,
through the NMHC standards included
2012. Table II.B–1 and figure II.B–1b though there are some other effects in the final rule. By 2030, we estimate
show the estimated reductions from reflected in the differing NOX that emissions of air toxics pollutants,
these sulfur changes. reductions as well, due to updated such as benzene, formaldehyde,
modeling assumptions and the adjusted acetaldehyde, 1,3-butadiene, and
NOX standards levels for engines over acrolein, would be reduced by 35
750 horsepower. Section II.A.4 of this percent from land-based nonroad diesel
25 Highway fuel is currently used in a significant
preamble contains a detailed discussion engines. Diesel PM reductions were
fraction of land based nonroad equipment,
locomotives, and marine vessels, reducing the in-
of the NOX standards we are adopting discussed above. For specific air toxics
use average sulfur level from about 3,000 ppm for for engines over 750 horsepower as well reduction estimates, see chapter 3 of the
uncontrolled high-sulfur fuel to 2,300 or 2,400 ppm. as the basis for those standards. RIA.
II. Nonroad Engine Standards and obtain very similar emissions Likewise, the long-term NOX standards
In this section we describe the reductions. The long-term PM filter- we are adopting for nearly all engines
emission standards for nonroad diesel based standards that apply to all engines above 75 hp will yield NOX reductions
engines that we are setting to address over 25 hp, combined with the fuel of about 90% from the NOX levels
the serious air quality problems change and new requirements to ensure expected from even the low-emitting
discussed in section I. These Tier 4 robust control in the field, will yield PM Tier 3 engines due to first reach the
standards, which take effect starting in reductions of over 95% from the in-use market in 2006 or later. The Tier 4
2008, are very similar to those proposed, levels of today’s cleanest Tier 2 engines. standards will bring about large
reductions in toxic hydrocarbon sulfur nonroad diesel fuel requirement A. What Are the New Engine Standards?
emissions as well. discussed in section IV); and
In this final rule we are largely • How diesel fuel sulfur affects an The Tier 4 exhaust emissions
adopting the standards and timing we engine’s ability to meet the new standards for PM, NOX, and NMHC are
proposed, with the exception of those standards. summarized in tables II.A–1, 2, and 4.26
that apply to engines over 750 hp. We Crankcase emissions control
Additional provisions for engine and
restructured and modified the standards requirements are discussed in section
equipment manufacturers are discussed
and timing for these engines to address II.A.7. Previously adopted CO emission
in detail in section III. These include:
technical concerns and to focus on standards continue to apply as well. All
• The averaging, banking, and trading of these standards apply to covered
achieving comparable emission (ABT) program.
reductions through the introduction of nonroad engines over the useful life
• The transition program for periods specified in our regulations,
advanced technology as early as feasible equipment manufacturers.
from specific applications within this except where temporary in-use
• The addition of a ‘‘not-to-exceed’’ compliance margins apply as discussed
power category. See section II.A.4 for a
program to ensure in-use emissions in section III.E. To help ensure that
detailed discussion. We also are not
control. This program includes new these emission reductions will be
adopting the proposed minor
emission standards and related test achieved in use, we have adopted test
adjustments to the CO standard levels
procedures to supplement the standards procedures for measuring compliance
for some engines under 75 hp, as
discussed in this section. with these standards tailored to both
explained in section II.A.6. In addition,
there are minor changes from the • The test procedures and other steady-state and transient nonroad
proposal in the phase-in approach we compliance requirements associated engine operating characteristics. These
are adopting for NOX and NMHC with the emission standards. test procedures are discussed in several
standards, as detailed in this section. • Special provisions to aid small subsections of section III. Another
In this section we discuss: businesses in implementing our component of our program to ensure
• The Tier 4 engine standards, and requirements. control of emissions in-use is the new
the schedule for implementing them; • An incentive program to encourage ‘‘not-to-exceed’’ (NTE) emission
• The feasibility of the Tier 4 innovative technologies and the early standards and associated test
standards (in conjunction with the low- introduction of new technologies. procedures, discussed in section III.J.
TABLE II.A–1.—TIER 4 PM STANDARDS (G/BHP-HR) AND SCHEDULE

Model year
Engine power
2008 2009 2010 2011 2012 2013
hp < 25 (kW < 19) ................................................................................... a 0.30 ................ ................ ................ ................ ................
25 ≤ hp < 75 (19 ≤ kW < 56) ................................................................... b 0.22 ................ ................ ................ ................ 0.02
75 ≤ hp < 175 (56 ≤ kW < 130) ............................................................... ................ ................ ................ ................ 0.01 ................
175 ≤ hp ≤ 750 (130 ≤ kW ≤ 560) ........................................................... ................ ................ ................ 0.01 ................ ................
hp 750 (kW > 560) ................................................................................... See table II.A–4

Notes:
a For air-cooled, hand-startable, direct injection engines under 11 hp, a manufacturer may instead delay implementation until 2010 and dem-
onstrate compliance with a less stringent PM standard of 0.45 g/bhp-hr, subject also to additional provisions discussed in section II.A.3.a.
b A manufacturer has the option of skipping the 0.22 g/bhp-hr PM standard for all 50–75 hp engines. The 0.02 g/bhp-hr PM standard would
then take effect one year earlier for all 50–75 hp engines, in 2012.
TABLE II.A–2.—TIER 4 NOX AND NMHC STANDARDS AND SCHEDULE

Standard Phase-in schedule
(g/bhp-hr) (model year)
Engine power (percent)
NOX NMHC 2011 2012 2013 2014
25 ≤ hp < 75 (19 ≤ kW < 56) ................................................................... 3.5 NMHC+NOX a ................ ................ 100% ................
75 ≤ hp < 175 (56 ≤ kW < 130) ............................................................... 0.30 0.14 b50 b50 b100
175 ≤ hp ≤ 750 (130 ≤ kW ≤ 560) ........................................................... 0.30 0.14 50 50 50 100
hp > 750 (kW > 560) ............................................................................... See table II.A–4

Notes: Percentages indicate production required to comply with the Tier 4 standards in the indicated model year.
a This is the existing Tier 3 combined NMHC+NO standard level for the 50–75 hp engines in this category. In 2013 it applies to the 25–50 hp
X
engines as well.
b Manufacturers may use banked Tier 2 NMHC+NO credits from engines at or above 50 hp to demonstrate compliance with the 75–175 hp
X
engine NOX standard in this model year. Alternatively, manufacturers may forego this special banked credit option and instead meet an alter-
native phase-in requirement of 25/25/25% in 2012, 2013, and 2014 through December 30, with 100% compliance required beginning December
31, 2014. See sections III.A and II.A.2.b.
26 Consistent with past EPA rulemakings for outside the U.S., and in laboratory operations in horsepower-hour, power ratings in horsepower, etc.
nonroad diesel engines, our regulations express which these units are the norm. However, in this In any compliance questions that might arise from
standards, power ratings, and other quantities in preamble and in other rulemaking documents for differences in these due to, for example, rounding
international SI (metric) units—kilowatts, gram per the general reader, we have chosen to use terms conventions, the regulations themselves establish
kilowatt-hour, etc. This aids in achieving more common in general usage in the U.S. Hence
the applicable requirements.
harmonization with standards-setting bodies standards are expressed in units of grams per brake
The long-term 0.01 and 0.02 g/bhp-hr As we proposed, these 2008 Tier 4 2008 (see section III.D). Fuel sulfur has
Tier 4 PM standards for 75–750 hp and engine standards apply only to engines a known correlation to PM generation,
25–75 hp engines, respectively, below 75 hp. We are not setting Tier 4 even for engines without aftertreatment.
combined with the fuel change and new standards taking effect in 2008 for larger Moreover, for any manufacturers who
requirements to ensure robust control in engines. The reasons for this differ believe that accomplishing this PM pull-
the field, represent a reduction of over depending on the engines’ hp rating. ahead will hamper their Tier 3
95% from in-use levels expected with Setting Tier 4 2008 standards for compliance efforts for these engines,
Tier 2/Tier 3 engines.27 The 0.30 g/bhp engines at or above 100 hp would there is an alternative Tier 4 compliance
hr Tier 4 NOX standard for 75–750 hp provide an insufficient period of option. Instead of meeting new Tier 4
engines represents a NOX reduction of stability (an element of lead time) PM standards in both 2008 and 2013,
about 90% from in-use levels expected between Tier 2⁄3 and Tier 4, and so manufacturers may skip the Tier 4 2008
with Tier 3 engines. Emissions would not be appropriate. This is PM standard, and instead focus design
reductions from engines over 750 hp are because these engines become subject to efforts on introducing PM filters for
discussed in section II.A.4. existing Tier 2 or 3 NMHC+NOX these engines one year earlier, by
In general, there was widespread standards in 2006 or 2007. Setting new complying with the aftertreatment-based
support in the comments for the 2008 standards for them thus would standard for PM in 2012. These options
proposed Tier 4 engine standards and provide only one or two years of Tier 2/ are discussed in more detail in section
for the timing we proposed for them. Tier 3 stability before another round of II.A.3.b.
Some commenters raised category- design changes would have to be made We view the 2008 portion of the Tier
specific concerns, especially for the in 2008 for Tier 4. 4 program as highly important because
smaller and the very large engine It is also inappropriate to establish it provides substantial PM and SOX
categories. These comments are 2008 Tier 4 standards for engines of 75– emissions reductions during the several
discussed below. 100 hp. The stability issue just noted for years prior to 2011. Initiating Tier 4 in
larger engines is not present for these 2008 also fits well with the lead time
1. Standards Timing engines, because these engines are (including stability), cost, and
a. 2008 Standards subject to Tier 3 NMHC+NOX standards technology availability considerations of
starting in 2008, so that our setting a the overall program. Initiating the Tier
The timing of the Tier 4 engine Tier 4 PM standard for them in the same 4 engine standards in 2008 provides
standards is closely tied to the timing of year would not create the situation in three to four years of stability after the
fuel quality changes discussed in which engines have to be redesigned start of Tier 2 for engines under 50 hp.
section IV, in keeping with the systems twice to comply with new standards As mentioned above, it also coincides
approach we are taking for this program. within a space of one or two years. with the start date of Tier 3 NMHC+NOX
The earliest Tier 4 engine standards take However, EPA believes the more standards for 50–75 hp engines and so
effect in model year 2008, in significant concern for these engines is introduces no stability issues for these
conjunction with the introduction of meeting the stringent aftertreatment engines (as redesign for both PM and
500 ppm maximum sulfur nonroad based standards for PM and NOX in NOX occurs at the same time). The 2008
diesel fuel in mid-2007. This fuel 2012. We are concerned that adopting start date provides almost 4 years of
change serves a dual environmental interim 2008 standards for these engines lead time to accomplish redesign and
purpose. First, it provides a large would divert resources needed to testing. The evolutionary character of
immediate reduction in PM and SOX achieve these 2012 standards and the 2008 standards, based as they are on
emissions for the existing fleet of indeed jeopardize attaining them. Thus, proven technologies, and the fact that
engines in the field. Second, its although early emission reductions from some certified engines already meet
widespread availability by the end of these engines in 2008 would of course these standards as discussed in section
2007 aids engine designers in be desirable, we felt that the focus we II.B, leads us to conclude that the
employing emissions controls capable of are putting on obtaining much larger standards are appropriate within the
achieving the Tier 4 standards for model reductions from them in 2012, together meaning of section 213(a)(4) of the
year 2008 and later engines; this is with the fact that we already have a Tier Clean Air Act and that we are providing
because the performance and durability 3 NMHC+NOX standard taking effect for adequate lead time to achieve those
of such technologies as exhaust gas 75–100 hp engines in 2008, warrants standards.
recirculation (EGR) and diesel oxidation our not adding additional control Engine and equipment manufacturers
catalysts is improved by lower sulfur requirements for these engines during argued in their comments that the PM
fuel.28 The reduction of sulfur in this interim period. pull-ahead option for 50–75 hp engines
nonroad diesel fuel will also provide We note that the 50–75 hp engines is inappropriate because it constitutes a
sizeable economic benefits to machine also have a Tier 3 NMHC+NOX standard re-opening of the Tier 3 rule, involving
operators as it will reduce wear and taking effect in 2008 and, as noted as it does a Tier 4 PM standard in 2008,
corrosion and will allow them to extend above, we are setting a new Tier 4 2008 the same year that the Tier 3
oil change intervals (see section VI.B). PM standard for them. Unlike the larger NMHC+NOX takes effect. They further
These economic benefits will occur for 75–100 hp engines, however, the 50–75 argued that the non-pull-ahead option is
all diesel engines using the new fuel, hp engines have one additional year, not a real option because PM
not just for those built in 2008 or later. until 2013, before filter-based PM aftertreatment cannot be implemented
standards take effect, and also have no for these engines in 2012.
27 Note that we are grouping all standards in this
additional NOX control requirement We disagree with both contentions.
rule, including those that take effect in 2008, under being set beyond the 2008 Tier 3 We determined, as part of our feasibility
the general designation of ‘‘Tier 4 standards.’’ As a standard. These differences justify analysis for Tier 4, that it is feasible to
result, there are no ‘‘Tier 3’’ standards in the multi- including the interim Tier 4 PM design engines to meet the 2008 PM
tier nonroad program for engines below 50 hp or standard for these engines. We note too standard in the same year that a Tier 3
above 750 hp.
28 ‘‘Nonroad Diesel Emissions Standards Staff that achieving the 2008 PM standard is NMHC+NOX standard takes effect. See
Technical Paper,’’ EPA420–R–01–052, October enabled in part by the large reduction in section II.B and RIA sections 4.1.4 and
2001. certification fuel sulfur that applies in 4.1.5. One reason is that a substantial
part of the 2008 PM emission reductions in mid-2010, and the related engine implementation of Tier 4 standard start
do not result from engine redesign, but standards for PM, NOX, and NMHC that dates over 2011–2013 as described
rather are due to the reduction in begin to phase-in in the 2011 model above to be responsive to the technology
certification test fuel maximum sulfur year, provide most of the environmental migration and workload distribution
levels from 2000 to 500 ppm that results benefits of the program. Like the 2008 concerns.
from the fuel change in the field. This standards, these standards are timed to
reduction in sulfur levels also aids provide adequate lead time for engine 2. Phase-In of NOX and NMHC
engine designers in employing emission and equipment manufacturers. They Standards for 75–750 hp Engines
control technologies that are also are phased in over time to allow for a. Percent-of-Production Phase-In for
detrimentally affected by sulfur, not the orderly transfer of technology from NOX and NMHC
only for PM control, but also for NMHC the highway sector, and to spread the We are finalizing the percent-of-
and NOX control. Examples of these overall workload for engine and production phase-in for NOX and
sulfur-sensitive technologies are equipment manufacturers engaged in NMHC that we proposed for 75–750 hp
oxidation catalysts, which can redesigning a large number and variety engines. Because Tier 4 NOX emissions
substantially reduce PM and NMHC, of products for Tier 4. control technology is expected to be
and EGR, which is effective at reducing As we explained at proposal, we
derived from technology first
NOX. We note further that designing believe that the high-efficiency exhaust
introduced in highway heavy-duty
engines to meet the 2008 PM standard emission control technologies being
diesels, we proposed to adopt the
is also made less difficult by our not developed to meet our 2007 emission
implementation pattern for the Tier 4
requiring engine designers to consider standards for heavy-duty highway diesel
NOX standard which we adopted for the
the transient test, cold start, and not-to- engines can be adapted to most nonroad
heavy-duty highway diesel program.
exceed requirements that are otherwise diesel applications. The engines for
This will help to ensure a focused,
part of the Tier 4 program. These which we believe this adaptation from
highway applications will be most orderly development of robust high-
requirements do not take effect for these
straightforward are those in the 175–750 efficiency NOX control in the nonroad
engines until the 0.02 g/bhp-hr standard
hp power range, and thus these engines sector and will also help to ensure that
is implemented in 2012 or 2013. See
are subject to new standards requiring manufacturers are able to take
section III.F for details.
We also believe that the second high-efficiency exhaust emission maximum advantage of the highway
option (compliance with the controls as soon as the 15 ppm sulfur engine development program, with
aftertreatment-based PM standard in diesel fuel is widely available, that is, in resulting cost savings.
2012, with no interim 2008 standard) is the 2011 model year. Engines of 75–175 The heavy-duty highway rule allows
viable, and may be an attractive choice hp are subject to the new standards in for a gradual phase-in of the NOX and
especially for engine families on the the following model year, 2012, NMHC requirements over multiple
higher side of the 50–75 hp range that reflecting the need to spread the model years: 50% of each
share a design platform with larger redesign workload and, to some extent, manufacturer’s U.S.-directed production
engines being equipped with PM filters the greater effort that may be involved volume must meet the new standard in
to meet the Tier 4 standard for 75–175 in adapting highway technologies to 2007–2009, and 100% must do so by
hp engines in 2012. We believe 75 hp these engines. Engines between 25 and 2010. Through the use of emissions
is the appropriate cutpoint for setting 75 hp are subject to new standards for averaging, this phase-in approach also
and timing emissions standards (see PM based on high-efficiency exhaust provides the flexibility for highway
section II.A.5), but it obviously is not a emission controls in 2013, reflecting engine manufacturers to meet that
hard-and-fast separator between engine again the need to spread the workload program’s environmental goals by
platforms for all manufacturers in all and the challenge of adapting this allowing somewhat less-efficient NOX
product lines. Even for many 50–75 hp technology to these engines which controls on more than 50% of their
engines that do not share a design typically do not have highway production during the 2007–2009
platform with larger engines, we believe counterparts. Engines over 750 hp phase-in years.
that a 2012 implementation date for PM involve a number of special We follow the same pattern in this
filter technology may be practical, considerations, necessitating an rule. As proposed, we are phasing in the
considering the 4-year lead time it implementation approach unique to NOX standards for nonroad diesels over
affords after Tier 3 begins for these these engines as explained in section 2011–2013 as indicated in table II.A–2,
engines (in 2008), 8-year lead time after II.A.4. Lastly , there are additional based on compliance with the Tier 4
the last PM standard change (in 2004), provisions discussed in sections III.B.2 standards for 50% of a manufacturer’s
and 5-year lead time after full-scale PM and III.M to encourage early technology U.S.-directed production in each power
filter technology implementation on introduction and to further draw from category between 75 and 750 hp in each
highway engines (in 2007). the highway technology experience. phase-in model year. The phase-in of
Engine manufacturers also This approach of implementing Tier 4 standards for engines over 750 hp is
commented that the two-options standards by power category over 2011– discussed in section II.A.4. With a NOX
approach would cause their customers 2013 provides for the orderly migration phase-in, all manufacturers are able to
to switch engine suppliers in 2012 to get of technology and distribution of introduce their new technologies on a
the least expensive engines possible in redesign workload over three model limited number of engines, thereby
every year, thus compromising the years, as EPA provided in Tier 3. gaining valuable experience with the
environmental objectives and creating Overall, this approach provides 4 to 6 technology prior to implementing it on
market disruptions. We have addressed years of real world experience with the their entire product line. In tandem with
these concerns as discussed in section new technology in the highway sector, the equipment manufacturer transition
II.A.3.b. involving millions of engines (in program discussed in section III.B, the
addition to the several additional years phase-in ensures timely progress to the
b. 2011 and Later Standards provided by demonstration fleets on the Tier 4 standard levels while providing
The second fuel change for nonroad road in earlier years), before the new a great degree of implementation
diesel fuel, to 15 ppm maximum sulfur standards take effect. We consider the flexibility for the industry.
This ‘‘percent of production phase-in’’ objectives for nonroad diesels. Therefore compliance on larger engines with
is intended to take maximum advantage we are not adopting the suggested much higher lifetime emissions
of the highway program technology earlier completion of the phase-in. potential. Even so, the horsepower
development. It adds a new dimension As proposed, we are phasing in the ranges for these power categories are
of implementation flexibility to the Tier 4 NMHC standard for 75–750 hp fairly broad, so this restriction allows
staggered ‘‘phase-in by power category’’ engines with the NOX standard, as is ample freedom to manufacturers to
used in the nonroad program for Tiers being done in the highway program. structure compliance plans in the most
1–3 (and also in this Tier 4) which, Engines certified to the new NOX cost-effective manner. There were no
though structured to facilitate requirement would be expected to adverse comments on this approach.
technology development and transfer, is certify to the NMHC standard as well.
The ‘‘phase-out’’ engines (those not b. Special Considerations for the 75–175
more aimed at spreading the redesign hp Category
workload. Because the Tier 4 program certified to the new Tier 4 NOX and
involves challenges in addressing both NMHC standards) would continue to be As discussed in the proposal, the 75–
technology development and redesign certified to the applicable Tier 3 175 hp category of engines and
workload, we believe that incorporating NMHC+NOX standard. As discussed in equipment may involve added workload
both of these phase-in mechanisms into section II.B, we believe that the NMHC challenges for the industry to develop
the program is warranted, resulting in standard is readily achievable through and transfer technology. Though
the coordinated phase-in plan shown in the application of PM traps to meet the spanning only 100 hp, this category
table II.A–2, which we are finalizing PM standard, which does not involve represents a great diversity of
essentially as proposed. Note that this such a phase-in. However, in the applications, and comprises a
results in the new NOX requirements for highway program we chose to phase in disproportionate number of the total
75–175 hp engines taking effect starting the NMHC standard with the NOX nonroad engine and machine models.
in the second year of the 2011–2013 standard to simplify the phase-in under Some of these engines, though having
general phase-in, in effect creating a 50– the percent-of-production approach characteristics comparable to many
50% phase-in in 2012–2013 for this taken there, thus avoiding subjecting the highway engines such as turbocharging
category. This then staggers the Tier 4 ‘‘phase-out’’ engines to separate and electronic fuel control, are not
start years by power category as in past standards for NMHC and NMHC+NOX directly derived from highway engine
tiers: 2011 for engines at or above 175 (which could lead to increased platforms and so are likely to require
administrative costs with essentially no more development work than larger
hp, 2012 for 75–175 hp engines, and
different environmental result). The engines to transfer emission control
2013 for 25–75 hp engines (for which no
same reasoning applies here because, as technology from the highway sector.
NOX adsorber-based standard and thus
in the highway program, the previous- Furthermore, the engine and equipment
no percentage phase-in is being
tier standards are combined manufacturers have greatly varying
adopted), while still providing a
NMHC+NOX standards. No commenters market profiles in this category, from
production-based phase-in for advanced
objected to this approach. focused one- or two-product offerings to
NOX control technologies.
Because of the tremendous variety of very diverse product lines with a great
Comments from the States and engine sizes represented in the nonroad many models.
environmental organizations argued for diesel sector, we are finalizing our Therefore, in addition to the
the completion of the phase-in by the proposed requirement that the phase-in flexibility provided through the phase-
end of 2012, contending that technology requirement be met separately in both of in mechanism, we proposed two
progress for NOX control in the highway the power categories with a phase-in optional measures to provide added
sector has been good to date and would (75–175 hp and 175–750 hp).29 For flexibility in implementing the Tier 4
support an accelerated phase-in in the example, a manufacturer that produces NOX standards, while keeping a priority
nonroad sector. However, our 1000 engines for the 2011 U.S. market on bringing PM emissions control into
assessment continues to show unique in the 175 to 750 hp range would have this diverse power category as quickly
(though surmountable) challenges in to demonstrate compliance with the as possible. First, we proposed to allow
adapting advanced technologies to NOX and NMHC standards on at least manufacturers to use NMHC+NOX
nonroad engines, especially for engines 500 of these engines, regardless of how credits generated by any Tier 2 engines
least like highway diesels, and it is many complying engines the over 50 hp (in addition to any other
these engines that would be most manufacturer produces in the 75–175 allowable credits) to demonstrate
affected by a truncated phase-in hp category. (Note however that we are compliance with the Tier 4 requirement
schedule. Furthermore, even if we were allowing averaging of emissions for 75–175 hp engines in 2012, 2013,
to conclude that advanced technologies between these engine categories through and 2014 only. Second, we proposed
will be ready earlier than expected, we the use of power-weighted ABT program allowing a manufacturer to instead
would not be able to move up the start credits.) We believe that this restriction demonstrate compliance with a reduced
of phase-in dates because these dates reflects the availability of emissions phase-in requirement of 25% for NOX
also depend on low-sulfur fuel control technology, and is needed to and NMHC in each of 2012, 2013, and
availability. Thus an end-of-2012 phase- avoid erosion of environmental benefits the first 9 months of 2014. Full
in completion date would result in that might occur if a manufacturer with compliance (100% phase-in) with the
phase-ins as short as one year, thus a diverse product offering were to meet Tier 4 standards would have needed to
degrading the industry’s opportunity to the phase-in with relatively low cost be demonstrated beginning October 1,
distribute the redesign workload and smaller engines, thereby delaying 2014.
departing from the pattern set by the Engine manufacturers reinforced the
highway program. Both of these are 29 Note exceptions to the percent phase-in points we made in the proposal
critical factors in our assessment that requirements during the phase-in model years regarding added workload challenges
the proposed engine standards are discussed in sections III.L and III.M. These deal for this diverse category of engines and
with differences between a manufacturer’s actual
feasible, and so a change to shorter and projected production levels, and with
machines. However, they suggested that
phase-ins would jeopardize incentives for early or very low emission engine the first of the proposed options to
achievement of our environmental introductions. address these challenges (allowing use
of Tier 2 credits) is not likely to be used standards will need to be demonstrated engines are now planning to comply
due to a lack of available Tier 2 credits, beginning December 31, 2014. As with our 2007 standards using this
and therefore should be dropped, and proposed, manufacturers using this emissions averaging approach,
that the second option (allowing a reduced phase-in option will not be increasing the significance of comments
slower phase-in) provided too short a allowed to generate NOX credits from on the topic from nonroad engine
stability period, and should be modified engines in this power category in 2012, manufacturers, many of whom also
to delay final compliance by an 2013, and 2014, except for use in make highway engines.30
additional 3 months, to December 31, averaging within the 75–175 hp category After carefully considering the issues
2014 or January 1, 2015. In addition to (that is, no banking or trading, or involved, we agree that the proposed
describing the very large redesign averaging with engines in other power approach lends itself to expression in
workload, they pointed out that engines categories). We believe that this terms outside of the averaging, banking,
and machines in this category typically restriction on credit use is appropriate, and trading program and that it makes
do not have a model year that differs considering that larger engine categories sense to do so. We are creating such an
from the calendar year, and so the will be required to demonstrate a alternative in the final regulations
substantial changes required for Tier 4 substantially greater degree of accordingly. These alternative standards
compliance in October 2014 could force compliance with the 0.30 g/bhp-hr NOX do not substantively change our Tier 4
the need to change the product for all standard several years earlier than program from what we proposed, but
of 2014, effectively shortening the engines built under this option. As the rather respond to manufacturers’
phase-in to two years. One manufacturer purpose of this option is to aid suggestions for administrative
argued that the compliance date for the manufacturers in implementing Tier 4 simplifications to what is essentially an
75–100 hp engines in this category NOX standards for this challenging averaging-based flexibility option in
should be delayed an additional year, to power category, we do not want any demonstrating compliance with the
2016, and that the start of the phase-in manufacturers who might be capable of percent-of-production NOX phase-in.
for these engines should be likewise building substantially greater numbers The alternative NOX phase-in standards
delayed from 2012 to 2013. of cleaner engines to use this option as are shown in table II.A–3. They apply
We do not feel that the first option an easy and copious source of credits only during the NOX phase-in years.
(allowing use of Tier 2 credits) should (owing to its slower phase-in of Manufacturers may use both approaches
be dropped, as it provides an alternative stringent standards) that in turn can be within a power category if desired,
flexibility mechanism for a power used to delay building clean engines in certifying some engines to the
category in which flexibility is clearly other categories or model years. alternative standards, with the rest
important, and is environmentally subject to the phase-in percentage
helpful as it provides an option for c. Alternative Phase-In Standards
requirement. Note that engines under 75
manufacturers to achieve NOX emission To ensure that Tier 4 engine hp subject to Tier 4 NOX standards do
reductions earlier than under the second development is able to take maximum not have an alternative standard because
option. By providing an opportunity to advantage of highway diesel technology they do not have a NOX phase-in, and
use Tier 2 credits in the 75–175 hp advances, we proposed to adopt engines over 750 hp do not have an
category, it coordinates well with the nonroad diesel provisions in the alternative standard because of the
Tier 2 credit use opportunity we are averaging, banking, and trading program separate standards we are adopting for
providing for the 50–75 hp engines that would parallel the heavy-duty these engines (explained in section
meeting the 2008 PM standard (see highway engine program’s ‘‘split family II.A.4).
section III.A), and allows for provisions’’ (see 68 FR 28470, May 23,
coordinated redesign and credit use 2003). In essence, these allow a TABLE II.A–3.—TIER 4 ALTERNATIVE
planning by a manufacturer over this manufacturer to declare an engine
NOX PHASE-IN STANDARDS (G/BHP-
wide power range over many years. family during the phase-in years that is
HR)
Nonetheless, recognizing that the certified at NOX levels roughly midway
second option may be more attractive to between the phase-out standard and NOX standard
manufacturers, and considering the phase-in standard, without the Engine power (g/bhp-hr)
comments they provided on it, we have complication of tracking credit
concluded that a three month phase-in generation and use. Because they 75 ≤ hp < 175 (56 ≤ kW <
a 1.7
extension until the end of 2014 is constitute a calculational simplification 130) .................................
warranted to address the workload of the emissions averaging provisions, 175 ≤ hp ≤ 750 (130 ≤ kW
burden and to align product cycle dates. these split family provisions do not ≤ 560) .............................. 1.5
Thus we are adopting the December 31, result in a loss in environmental Notes: a Underthe option identified in foot-
2014 implementation date suggested in benefits compared to what the phase-in note b of table II.A–2, by which manufacturers
comments for completion of the 75–175 can achieve. may meet an alternative phase-in requirement
The nonroad proposal also included of 25/25/25% in 2012, 2013, and 2014 through
hp engine phase-in. December 30, the corresponding alternative
We do not agree that an additional specific emission levels for these split NOX standard is 2.5 g/bhp-hr.
year of delay is appropriate for the 75– families, rather than just describing how
they are calculated. Commenters The engines certified under these
100 hp engines in this category. The
suggested that we go one step further standards will of course also need to
comment expressing interest in our
still and express these levels as meet the Tier 4 PM and crankcase
doing so did not provide any basis for
alternative standards. They argued that control requirements that take effect for
it in technological feasibility or in
this would facilitate attempts at all engines in the first phase-in year.
workload burden, and we do not see any
harmonizing standards globally, They will also need to comply with all
basis for it ourselves.
Therefore, we are adopting both of the especially for standards-setting bodies Tier 4 provisions that would apply to
proposed optional measures for the 75– such as the European Commission that 30 See the recently published ‘‘Highway Diesel
175 hp engine phase-in, except that in do not have emissions averaging Progress Review Report 2,’’ EPA420–R–04–004,
the second option, full compliance programs. We are also aware that most available at http://www.epa.gov/otaq/
(100% phase-in) with the Tier 4 manufacturers of highway diesel diesel.htm#progreport2.
phase-in engines, including the 0.14 g/ with all of our ABT programs, is the concluded that other proven PM-
bhp-hr NMHC standard and the NTE adoption of NOX FEL caps for these reducing technologies such as diesel
and transient test requirements for all engines. To maintain the character of oxidation catalysts and engine
pollutants. We recognize that this differs this compliance path as producing optimization could be applied to
from what is required under the phase- engines during the phase-in years that engines under 25 hp. Accordingly, we
in approach, in which these emit at NOX levels which are roughly proposed Tier 4 PM standards to take
requirements would not apply to the averaged between Tier 3 and final Tier effect beginning in 2008 for these
50% of engines categorized as ‘‘phase- 4 levels, we are setting NOX FEL caps engines based on use of these
out’’ engines. However, under the for these engines at levels reasonably technologies.
alternative standards approach, what close to the alternative standards. (See In contrast to our proposals for other
would have been two different engine section III.A for details.) Because we are engine categories, the proposed Tier 4
families (one meeting phase-in also maintaining the original phase-in/ standards for this category elicited very
requirements and one meeting phase- phase-out compliance path, a little comment from the engine
out requirements, with NOX and PM manufacturer wishing to build engines manufacturers other than an expression
emissions averaging allowed between with NOX levels higher than these FEL of support for deferring consideration of
them under the ABT provisions) are caps, at or approaching the Tier 3 levels, any more stringent standards pending
replaced by a single engine family could still do so; in fact these would in results of a future technology review.
meeting the one set of alternative actuality fit the description of a phase- The States and environmental
standards. Therefore all of the engines out engine. This manufacturer would organizations expressed disappointment
in this family must by default meet the also, of course, have to produce a that EPA had not proposed more
phase-in requirements for provisions corresponding number of phase-in stringent standards for these engines,
that lack any sort of averaging engines meeting the aftertreatment given the very large number of these
mechanism (NMHC standard, NTE, etc). based Tier 4 NOX standards. engines in the field and the significant
As a result, any manufacturer choosing We also observe that the creation of risk they pose due to individuals’
to design to the alternative standards alternative standards provides the exposure to diesel PM and air toxics.
rather than using the phase-in approach opportunity to adjust the phase-in/ They urged more stringent 2008 PM
provides some additional environmental phase-out provisions so as to reinforce standards and the adoption of standards
benefit as an indirect result of choosing their focus on introducing high- obtaining emission reductions of 90% or
this approach. efficiency NOX aftertreatment more by the end of 2012. Emissions
We also believe that this alternative technology during the phase-in years, control manufacturers argued that more
standards provision makes appropriate a which is, of course, their aim. We are stringent 2008 standards based on the
further adjustment to the NOX phase-in doing this by setting NOX family use of more efficient oxidation catalysts
scheme to better preserve both the emission limit (FEL) caps for phase-in are feasible.
advanced technology phase-in engines at the same low levels as for As discussed in section II.B.4, we
approach, for those manufacturers Tier 4 engines produced in the post- continue to believe that the standards
choosing that compliance path, and the phase-in years. (Again, see section III.A we proposed for engines under 25 hp
alternative standards approach, for for details.) Although the engine are feasible, and commenters in the
those choosing that path. Under the nonroad diesel industry provided no
manufacturers indicated in their
proposal, the provision for certifying a comments to the contrary. Our reasons
comments that they did not believe it
split engine family at a pre-designated for not proposing more stringent Tier 4
likely that anyone would choose this
NOX level would not allow credit standards for these engines based on the
phase-in/phase-out compliance path, we
generation by or credit use on engines use of PM filters and NOX aftertreatment
believe that preserving it and focusing it
in the split family (other than for were mainly focused on the cost of
on encouraging very low-NOX engines
averaging within the family). This was equipping these relatively low cost
as early as possible provides a
consistent with our goal of providing a engines with such devices, especially
potentially useful and environmentally
simple, single average NOX standard considering the prerequisite need for
desirable alternative path. Thus these
level for the family, equivalent to electronic fuel control systems to
two concepts have been developed to facilitate regeneration. The comments
arbitrarily designating a portion of the
provide complementary compliance supporting more stringent standards
engines in the family as ‘‘phase-out’’
paths obtaining equivalent overall NOX were not convincing, as they did not
engines (credit generators) and the rest
reductions, one focused on phasing in address these cost issues. However, we
as ‘‘phase-in’’ engines (credit users)
high-efficiency NOX aftertreatment and do agree that these small engines likely
with a net credit balance of zero, while
the other on achieving NOX control for have a large impact on human health,
avoiding the burden of actually
all subject engines during the phase-in and, as discussed in section VIII.A, we
calculating and tracking credits. This
was also consistent with our approach years at an average level between the are reaffirming the plan we described in
under the 2007 highway engine program Tier 3 and final Tier 4 standards levels. the proposal to reassess the appropriate
from which this concept is derived. 3. Standards for Smaller Engines long-term standards for these engines in
However, because this split family a technology review to take place in
provision has evolved into a set of a. Engines Under 25 hp 2007. We will set more stringent
alternative standards, there is no longer We are finalizing the Tier 4 program standards for these engines at that time,
a need to prohibit the generation and we proposed for engines under 25 hp. if appropriate.
use of ABT credits for these engines to In the proposal we presented our view We also disagree with comments
preserve a de facto net zero credit that standards based on the use of PM supporting more stringent 2008
balance, and so, considering that it is filters should not be set at this time for standards that would require the use of
also not environmentally detrimental, the very small diesel engines below 25 diesel oxidation catalysts on all small
we believe it is appropriate to allow hp. We also discussed our plan to engines. Although we agree that these
credit use and generation for these reassess the appropriate long-term catalysts can be applied so as to achieve
engines as for other engines. A standards in a technology review. emission reductions on some small
consequence of doing so, consistent However, for the nearer-term, we engines, the emissions performance data
we have analyzed do not support our generate credits as part of the ABT these standards in 2007. This planned
setting a more stringent standard. program, although credit use by these review is discussed in section VIII.A.
Section 4.1.5 of the RIA summarizes engines will still be allowed. Additional discussion of our feasibility
such data showing a very wide range of We received no adverse comments on assessment for the 2008 and 2013
engine-out PM emissions in this power this proposed alternative for qualifying standards can be found in section II.B.4
category. Applying oxidation catalyst engines under 11 hp. Euromot and RIA section 4.1.4.
technology to these engines, though commented that there are hand-startable In comments, emissions controls
capable of some PM reduction if engines in the 11–25 hp range, and that manufacturers argued that more
properly designed and matched to the we should extend the alternative stringent 2008 standards for PM and
application, is limited by sulfur in the compliance option to these engines as NMHC based on the use of more
diesel fuel. Specifically, precious-metal well. However, hand-startability is not efficient oxidation catalysts are feasible
oxidation catalysts (which have the the sole defining feature of engines for and should be adopted. Environmental
greatest potential for reducing PM) can which we established this alternative. organizations argued that PM and NOX
oxidize the sulfur in the fuel and form Rather, the alternative is for a class of standards for 2008 should be set at more
particulate sulfates. Even with the 500 engines typified by a combination of stringent levels, based on the use of
ppm maximum sulfur fuel available characteristics (very small, air-cooled, oxidation catalysts and improved engine
after 2007, the sulfate production direct injection, hand-startable), which optimization. The California Air
potential is large enough to limit what give rise to the potential technical Resources Board argued for more
can be done to set more stringent 2008 difficulties noted above. To extend the stringent 2008 standards for HC+NOX,
PM standards through the use of these alternative to other engines simply PM and toxics, based on the use of
catalysts. The 15 ppm maximum sulfur because they have a hand-start is not oxidation catalysts.
fuel available after 2010 will greatly justified, because they do not share We disagree with the comments
improve the potential for use of these technical difficulties (or do not calling for more stringent 2008
oxidation catalysts, but as we discussed share them to the same degree). Such an standards than proposed for 25–75 hp
above, we believe that the much larger extension could also potentially engines, based on the use of diesel
potential reduction afforded by PM filter encourage manufacturers of the many oxidation catalysts. The standards we
technology warrants our waiting until models of these larger engines to market proposed and are adopting for these
the technology review in 2007 to a hand-start option simply to avoid engines pull ahead sizeable PM
evaluate the appropriate long-term more stringent standards. reductions starting three years ahead of
standards for these engines. See section b. Standards for 25–75 hp Engines the earliest PM filter-based standards for
II.B.5 and RIA section 4.1.5 for further any engine size. The pull-ahead
discussion. We proposed a 0.22 g/bhp-hr PM standard level balances early reductions
When implemented, the Tier 4 PM standard for 25–75 hp engines, to take with the need to ensure that the PM
standard and related provisions we are effect in 2008. We also proposed a filter- filter-based standards and Tier 3
adopting today for engines under 25 hp based 0.02 g/bhp-hr PM standard for NMHC+NOX standards are not
will yield an in-use PM reduction of these engines, to take effect in 2013, the jeopardized by an overemphasis on
over 50% for these engines, and large year in which filter-based technology for early reductions. Although we agree that
reductions in toxic hydrocarbons as these engines is expected to be oxidation catalysts can be applied to
well. Achieving these emission applicable on a widespread basis (see these engines, the emissions
reductions is very important, section II.A.1). Also in 2013, the 25–50 performance data we have analyzed do
considering the fact that many of these hp engines would be subject to the 3.5 not support our setting a more stringent
smaller engines operate in populated g/bhp-hr NMHC+NOX standard already standard, for the same reasons described
areas and in equipment without closed adopted for 50–75 hp engines (taking above in section II.A.3.a for engines
cabs—in mowers, portable electric effect in 2008 as part of Tier 3). We are under 25 hp. Refer to section II.B.4 and
power generators, small skid steer adopting all of these proposed standards to section 4.1.4 of the RIA for additional
loaders, and the like. in this final rule. discussion. For a discussion of
We are also adopting the alternative The 2008 PM standard for these
comments opposed to new standards in
compliance option that we proposed for engines should maximize reduction of
2008, see sections II.A.1 and II.B of this
air-cooled, direct injection engines PM emissions using technology
preamble.
under 11 hp that are startable by hand, available in that year. We believe that We also do not agree that more
such as with a crank or recoil starter. As the 2008 PM standard is feasible for stringent NOX requirements based on
we explained in the proposal, the these engines, based on the same engine
improved engine optimization are
alternative is justified due (among other or oxidation catalyst technologies
appropriate for these engines in 2008. In
things) to these engines’ need for loose feasible for engines under 25 hp in
2001 we reviewed and confirmed the
design fit tolerances, their small 2008, following the introduction of
previously set NMHC+NOX emission
cylinder displacement and bore sizes, nonroad diesel fuel with sulfur levels
standards that will be in effect for these
and the difficulty in obtaining reduced below 500 ppm. We expect in-
engines during the time frame in
components for them with tight enough use PM reductions for these engines of
question.31 Because of the focus we are
tolerances (68 FR 28363, May 23, 2003). over 50% (and large reductions in toxic
putting on achieving large PM
This alternative allows manufacturers of hydrocarbons as well) over the five
reductions from these engines as early
these engines to delay Tier 4 model years this standard would be in
as possible, we felt that it was important
compliance until 2010, and in that year effect (2008–2012). These engines will
to strike a balance between PM and NOX
to certify them to a PM standard of 0.45 constitute a large portion of the in-use
control. As a result, we did not propose
g/bhp-hr, rather than to the 0.30 g/bhp population of nonroad diesel engines for
more stringent NOX standards for 50–75
hr PM standard applicable beginning in many years after 2008. Although we are
hp engines, and we proposed to apply
2008 to the other engines in this power finalizing the 2013 standards for 25–75
category. As proposed, engines certified hp engines today, we are also 31 ‘‘Nonroad Diesel Emissions Standards Staff
under this alternative compliance reaffirming our commitment to Technical Paper,’’ EPA420–R–01–052, October
requirement will not be allowed to conducting a technology review for 2001.
the 3.5 g/bhp-hr NMHC+NOX standard 2012 meeting the 0.02 g/bhp-hr PM As an example of this third option,
to 25–50 hp engines in 2013 because standard; that is, the equipment consider an equipment manufacturer
this is the year in which the PM filter- manufacturer would have to use an who does not use the transition
based standard is being implemented. engine from the same engine flexibility provisions (described in
Requiring new NOX controls for these manufacturer or from another engine section III.B), and over the 2008–2010
engines earlier than 2013 would add a manufacturer choosing the same period makes 1000 50–75 hp machines
third redesign step to those already compliance option. We also solicited for use in the U.S., 200 (20%) of which
called for in 2008 and 2013. This would comment on possible alternative use engines not certified to the 0.22 g/
add a potentially unacceptable amount solutions using a numerical basis, bhp-hr standard. In 2012, that
of redesign workload, to a point that it describing an example that would manufacturer must make at least 15% of
could jeopardize our objective of require the percentage of 50–75 hp his 50–75 hp machines for use in the
bringing stringent PM control to these machines equipped with PM filters in U.S. using engines certified to the 0.02
engines as early as possible. 2012 to be no less than the same g/bhp-hr standard. We feel that the 5%
Consistent with the proposal, we are percentage of 50–75 hp machines margin is needed to allow for some
not setting more stringent NOX produced with non-pull-ahead engines reasonable sales shifts within the
standards for engines below 75 hp at in 2008–2011. manufacturer’s product offering over
this time based on the use of NOX The Engine Manufacturers time, but is small enough to ensure that
aftertreatment. As discussed in section Association (EMA) and Deere any possible advantage gained from
4.1.2.3 of the RIA, a high degree of commented on the unenforceability of selling higher-emissions products
complexity and engine/aftertreatment the proposed ‘‘no switch’’ measure as remains minimal. Equipment
integration will be involved in applying part of a broader objection to our manufacturers must keep production
NOX adsorber technology to nonroad proposal for 50–75 hp engines. They records sufficient to prove compliance.
diesel engines. The similarity of larger pointed out that changing equipment This restriction and the percentage
nonroad engines (above 75 hp) to model designations could easily allow calculation will not apply to any 2008–
highway diesel engines, which will an equipment manufacturer seeking to 2012 engines at issue that are being
provide the initial experience base for avoid PM filter-equipped engines in produced under the equipment
this integration process, is key to our 2012 to declare a product in this model manufacturer transition flexibility
assessment that NOX adsorbers are year a ‘‘new product,’’ not the same as provisions discussed in section III.B.
feasible for these engines. On the other the 2008–2011 product. We have For example, if in addition to the 200
hand, although engines under 75 hp are concluded that there is indeed potential engines in 2008–2010 not certified to
gradually increasing in sophistication for this abuse to occur and, although no the 0.22 g/bhp-hr standard in the above
over time, the accumulation of one commented specifically on the example, this manufacturer also used
experience with designing and alternative approach, we believe it 500 previous-tier engines in 2008–2010
operating these engines with more clearly addresses this problem because under the flexibility allowance program,
advanced technology clearly lags it does not depend on product his percentage target for PM filter-
significantly behind the sizeable designations. equipped engines in 2012 would be
experience base already developed for Therefore, we are adopting a 35% of all the engines used in 2012 that
larger engines. At this point, we are provision to discourage engine are not previous-tier engines under the
unable to forecast how quickly adequate switching based on this alternative flexibility allowance program. 33
experience may accrue. Because this approach. An equipment manufacturer
experience is crucial to ensuring the who uses 50–75 hp engines will have 4. Standards for Engines Above 750 hp
successful integration of the engines three options: We are adopting different Tier 4
with NOX adsorber technology, we are standards for over 750 hp engines from
not adopting NOX adsorber-based (1) The manufacturer may exclusively use
engines certified to the 0.22 g/bhp-hr PM those we proposed, and we are also
standards for engines under 75 hp in standard (including through use of ABT adopting different implementation dates
this final rule. Rather, as discussed in credits) over the 2008–2011 period. This for these engine standards, though both
section VIII.A, we plan to undertake a manufacturer is then free to use any number the proposed and final programs have as
technology assessment in the 2007 time of 50–75 hp engines not certified to the 0.02 their primary focus the implementation
frame which would evaluate the status g/bhp-hr standards in 2012. of high-efficiency exhaust emission
of engine and emission control (2) The manufacturer may exclusively use controls as quickly as possible. The
technologies, including NOX controls, engines not certified to the 0.22 g/bhp-hr PM
standard over the 2008–2011 period. This approach being adopted reflects our
for engines less than 75 hp. careful review of the technical issues
As described in section II.A.1.a, we manufacturer must then use only 50–75 hp
engines that are certified to the 0.02 g/bhp presented by these engines. For some of
are providing two PM standard these engines, we are accelerating
hr standards in 2012 (including through use
compliance options to engine of ABT credits). standards based on the use of
manufacturers for 50–75 hp engines. As (3) The manufacturer may use a mix of aftertreatment controls. For others, we
part of this, we also proposed a measure engines in 2008–2011. In this case, the are deferring a decision on such
to ensure that it would not be abused by manufacturer must calculate the percentage aftertreatment-based standards. This
equipment manufacturers who use of 50–75 hp engines used (in U.S.-directed
approach represents a feasible and
engines that do not meet the PM pull- equipment) over the 2008–2010 period that
are not certified to the 0.22 g/bhp-hr PM pull- efficient approach to redesigning
ahead standard in 2008–2011, but who
then switch engine suppliers to avoid ahead standard. Then the percentage of 50–
75 hp engines this manufacturer uses in 2012 2011 confirmation of production volumes which, as
PM filter-equipped engines in 2012 as it would occur in 2012, would be too late to easily
that are certified to the 0.02 g/bhp-hr PM
well (68 FR 28360, May 23, 2003). We re-focus 2012 production if the confirmed volumes
standard must be no less than this 2008–2010
proposed that an equipment non-pull-ahead percentage figure minus a 5%
differ from projections. It is not likely that
manufacturer making a product with manufacturers would abuse the program by
margin.32 switching engine suppliers for this one year of
engines not meeting the pull-ahead production.
standard in any of the years 2008–2011 32 The 2011 production is not included in the 33 That is: [200/(1000–500)] = 40%; subtracting
must use engines in that product in percentage calculation to avoid the need for post- the 5% margin then yields 35%.
engines and installing aftertreatment in standards, due primarily to the After evaluating these issues, EPA is
a coordinated, orderly manner over a relatively long product design cycles adopting an approach that tailors the
decade or more, and will achieve major typical of these high-cost, low-sales standards to the circumstances
reductions in PM and NOX from these volume engines and machines. presented by the different kinds of
large diesel engines. Specifically, we proposed that this engines in this power category. The
Under the proposal, all engines above category of engines move directly from NOX standards we are adopting will
750 hp were treated the same, with a Tier 2 to Tier 4, and that the Tier 4 PM achieve effective NOX control by
phase-in of PM and NOX aftertreatment standard be phased in for these engines accelerating the proposed schedule for
technology that started in 2011 and on the same 50–50–50–100% schedule final NOX standards based on high-
finished in 2014. The final standards are as the NOX and NMHC phase-in efficiency NOX aftertreatment for the
based on our evaluation of the differing schedule, over the 2011–2014 model largest generator sets, and by requiring
technical issues presented by the two years. This would provide engine engines in other generator sets to also
primary kinds of equipment in this manufacturers with up to 8 years of meet aftertreatment-based NOX
category, mobile power generation design stability to address concerns standards, although we are delaying the
equipment (generator sets) and mobile specific to this category. Although we implementation date for these standards
machinery. For both generator sets and expressed our belief that these proposed compared to the implementation
mobile machinery, PM aftertreatment provisions would enable the schedule we proposed. We believe that
based standards will start in 2015, with manufacturers to meet proposed Tier 4 NOX adsorber technology will be
no prior phase-in. EPA is replacing the engine standards, we also acknowledged feasible for these generator set engines.
proposed phase-in with a PM standard concerns the manufacturers had We also believe that they may be an
starting in 2011 that is comparable to expressed to us, and asked for comment especially attractive application for
the overall level of control that the on whether this category, or some subset Selective Catalytic Reduction (SCR)
proposed phase-in would achieve. of it defined by hp or application, technology, which relies on the
Differences within these applications, should have a later phase-in start date, injection of urea into the exhaust
however, call for different approaches to a later phase-in end date, adjusted stream. There are many stationary diesel
the implementation of NOX standards, additional equipment generator sets using SCR today. Large
aftertreatment technology. For generator manufacturer transition flexibility mobile generator sets, though moved
sets above 1200 hp, an aftertreatment provisions, or some combination of from location to location, operate much
based NOX standard will start in 2011, these (68 FR 28364, May 23, 2003). like stationary units once in place, with
three years earlier than the date we fuel (and potentially urea) delivered and
proposed for full implementation of Comments from manufacturers of replenished periodically. See section
such standards. For generator sets below engines and equipment in this power II.B.3 for further discussion.
1200 hp, the same aftertreatment-based category expressed their widespread For equipment other than generator
NOX standard will start in 2015. As with view that the proposed standards were sets, we are deferring a decision on
the PM standard, there is no phase-in. inappropriate in critical respects. In setting aftertreatment-based NOX
For engines used in mobile machinery, addition to reiterating the need for extra standards to allow additional time to
which is assumed to include all lead time due to long product design evaluate the technical issues involved in
equipment that is not a generator set, cycles, they pointed to difficulties with adapting NOX control technology to
EPA is deferring a decision on setting aftertreatment placement, with these applications and engines. We are
aftertreatment-based NOX standards to fabrication of the large filters that would still evaluating the issues involved for
allow additional time to evaluate the be needed for these engines, with these engines to achieve a more
technical issues involved in adapting potential failures caused by uneven soot stringent NOX standard, and believe that
NOX adsorber technology to these loading and regeneration in large filters, these issues are resolvable. We intend to
applications and engines. However, EPA with stresses due to thermal gradients continue evaluating the appropriate
is adopting a NOX standard for these across large filters, and with mechanical long-term NOX standard for mobile
engines starting in 2011 that will stresses in mining applications with machinery over 750 hp and expect to
achieve large NOX reductions by relying high shock loads. The manufacturers announce further plans regarding these
on engine-based emissions control noted that aftertreatment-based issues (we are currently considering
technology. Consistent with the standards for NOX and PM were feasible such an action in the 2007 time frame).
different approaches we are taking to for engines used in large mobile power The basis for the 0.50 g/bhp-hr NOX
setting standards for engines above and generators. However, manufacturers did standard we are adopting for generator
below 750 hp, we are also adopting not believe aftertreatment-based NOX sets over 750 hp is discussed in section
restrictions on ABT credit use between standards could be implemented in the II.B.3. We are also modifying the PM
these power categories, as described in time frame proposed for engines used in and NMHC standards we proposed (as
section III.A. large mobile machinery such as well as certain implementation dates for
Consistent with the approach we took bulldozers and mine haul trucks. States, these provisions), and modifying our
in previous standard-setting for these environmental organizations, and proposed approach to ensuring transient
engines, we proposed that nonroad manufacturers of emissions controls, on emissions control for these engines
diesels above 750 hp be given more lead the other hand, expressed support for (discussed in section III.F). The Tier 4
time than engines in other power the standards we proposed for these standards for engines over 750 hp are
categories to fully implement Tier 4 engines. shown in table II.A–4.
TABLE II.A–4.—TIER 4 STANDARDS FOR ENGINES OVER 750 HP (G/BHP-HR)

2011 2015
PM NOX NMHC PM NOX NMHC
Engines used in:

generator sets ≤1200 hp ........................................ 0.075 2.6 0.30 0.02 0.50 0.14
generator sets >1200 hp ........................................ 0.075 0.50 0.30 0.02 No new standard 0.14
all other equipment ................................................. 0.075 2.6 0.30 0.03 No new standard 0.14
Unlike NOX control technology, we via the ABT program. Because in this 5. Establishment of New Power
believe that the more advanced state of rule we are no longer phasing in to a Categories
PM filter technology development today final NOX standard for some engines We are finalizing our proposal to
makes their availability for these over 750 hp, it no longer makes sense regroup the nine power categories
engines by 2015, with over ten years of to express the 2011 standards for these established for previous tiers into the
development lead time, more certain, engines in this manner. Instead we are five Tier 4 power categories shown in
and so we are setting PM standards for setting brake-specific emission table II.A–1. As we explained in the
both mobile machinery and generator standards effective in 2011. proposal, this regrouping will more
sets based on use of this technology. We Furthermore, to avoid further closely match the degree of challenge
note in section II.B.3 that achieving complicating an already complex involved in transferring advanced
durable PM filter designs for these large standards structure, we are adopting emissions control technology from
applications will likely require the use this pattern for the entire category, even highway engines to nonroad engines.
of wire mesh filter technology rather with engines such as those used in The proposed choice of 75 hp as the
than the somewhat more efficient wall generator sets for which the standards appropriate cutpoint for applying
flow ceramic-based technology could still be expressed as a percent aftertreatment-based NOX control drew
applicable to smaller engines, justifying phase-in to final standards. Except for particular attention. In the proposal, we
the somewhat higher level for the 2015 recognized that there is not an abrupt
the pull-ahead of the long-term NOX
PM standards shown in table II.A–4 power cutpoint above and below which
standard for large generator sets (which
(0.03 or 0.02 g/bhp-hr compared to 0.01 the highway-derived nonroad engine
will increase the environmental benefit
g/bhp-hr). Section II.B.3 also contains families do and do not exist, but noted
discussion of our bases for the other compared to the proposal), these 2011
further that 75 hp is a more appropriate
Tier 4 standard levels in this category. PM and NOX standards essentially
cutpoint to generally identify nonroad
We believe that the 2015 correspond to averaged standards under
engines in Tier 4 that will most likely
implementation year (versus the a 50% phase-in to aftertreatment-based be using highway-like engine
proposed 2014 date for the fully phased- standards, hence our conclusion that the technology than either of the closest
in standard) is necessary to allow Tier 4 program will provide a level of previously-adopted power category
development of the requisite control in 2011 that is substantially cutpoints of 50 or 100 hp. Nonroad
technologies for these large engines, and equivalent to that of the proposal. In diesels produced today with rated
to deal with the redesign workload Tier addition, PM and NOX emissions power above 75 hp (up to several
4 will create for the many engine and averaging through the ABT program will hundred hp) are mostly variants of
equipment models in this category allow a manufacturer to comply by nonroad engine platforms with four or
which, as noted, typically have very low phasing in aftertreatment technologies more cylinders and per-cylinder
production volumes and long product as in the proposed program, should they displacements of one liter or more.
cycles. desire to do so. Although there is no These in turn are largely derived from
For the purpose of determining which such averaging program for NMHC, the or are similar to heavy-duty highway
nonroad engines are subject to the 2011 NMHC standard can be achieved engine platforms. Even where nonroad
generator set standards, we are defining without the use of advanced engine models above 75 hp are not so
a generator set engine as: ‘‘An engine aftertreatment (as explained in section directly derived from highway models,
used primarily to operate an electrical II.B.3), thus helping to enable a they typically share many common
generator or alternator to produce manufacturer to pursue this compliance characteristics such as displacements of
electric power for other applications.’’ strategy if desired. one liter per cylinder or more, direct
This definition makes it clear that injection fueling, turbocharging, and,
This approach involving separate
generator set engines do not include increasingly, electronic fuel injection.
engines used in machines such as mine 2011 and 2015 standards is comparable These common features provide key
trucks that do mechanical work but that to the proposed percent phase-in building blocks in transferring high-
employ engine-powered electric motors approach with emissions averaging. We efficiency exhaust emission control
to propel the machine, but they do believe that it enables manufacturers to technology from highway to similar
include engines in nonroad equipment redesign engines and equipment in a nonroad diesel engines. We therefore
for which the primary purpose is to coordinated, orderly manner over a proposed to regroup power ratings using
generate electric power, even if the decade or more, and effectively gives the 75 hp cutpoint.
machine is also self-propelled. targeted additional flexibility to the The Engine Manufacturers
Similar to other power categories, we industry. Given the continuing Association and Euromot, which
proposed a 50% phase-in to the final availability of emissions averaging, we together represent the companies that
Tier 4 PM, NOX and NMHC standards, do not view this change as the creation make all but a tiny fraction of nonroad
with opportunity to average PM and of an additional, separate tier of diesel engines sold in the U.S.,
NOX between phase-in and phase-out standards compared to the proposal’s expressed their support for the 75 hp
engines in the 2011–2013 phase-in years phase-in of the Tier 4 standards. cutpoint, as did every individual engine
manufacturer who commented on this NOX control. EPA does not believe that the result being that the existing CO
subject. These companies generally the costs of meeting the NOX standard standards remain in place. In doing so,
endorsed EPA’s reasoning that the 75 hp for engines in the 75–100 hp range are we are not considering or reexamining
level is appropriate to ‘‘delineate those unreasonable, and we refer the reader to (and at proposal did not consider or
engines (and applications) for which the section VI for a detailed discussion of reexamine) the substantive basis for
application of on-highway like NOX our cost analysis for engines and those standards. Having multiple CO
aftertreatment technologies is not likely equipment meeting Tier 4 standards in standards within a power category will,
to be feasible or practical’’ (EMA this power range. Moreover, EPA firmly at worst, create minor inconveniences in
Comments p.10). believes such standards are certification and compliance efforts. As
However, the Association of technologically feasible for 75–100 hp a result, in the less than 25 hp category,
Equipment Manufacturers (AEM) and engines. (See section II.B.2.) Tier 4 engines below 11 hp will
the equipment manufacturer Ingersoll- Ingersoll-Rand also expressed concern continue to be subject to a different CO
Rand commented that 100 hp is the that the proposed consolidation of 3 standard than 11–25 hp engines,
more appropriate cutpoint for previous power categories into a single identical to Tier 2. Likewise, different
application of advanced NOX control 175–750 hp category creates significant CO standards will continue to apply in
technology. They based this view on hardship by requiring the introduction Tier 4 to engines above and below 50 hp
their observations that 75–100 hp of aftertreatment technologies in a single in the 25–75 hp category.
engines do not share many of the year, contrasting this with the Tier 2 We do note, however, that we are
characteristics of highway diesels, thus standards, which phased in over 2001– applying new certification tests to all
making technology transfer from the 2003 for these engines. In response, we pollutants covered by the rule, the result
highway sector very costly, and note that the Tier 3 standards, which being that Tier 4 engines will have to
customers will be negatively affected were set in the same rule that certify to CO standards measured by the
due to the relatively large cost impacts established the Tier 2 standards, will be transient test (NRTC) (which includes a
of NOX aftertreatment on these smaller introduced in a single year for these cold start test), and the NTE. Our intent
engines. They also argued that the 75 hp engines (2006), and that the Tier 2 in adopting these new certification
cutpoint would create significant phase-in over 3 years was established in requirements is not to alter the level of
misalignment in the global marketplace response to particular issues and stringency of the standard but rather to
because European regulations do not opportunities that were identified, ensure robust control of emissions to
use this cutpoint. specific to that time frame (see 62 FR this standard in use. The CO standards
We agree with the equipment 50181, September 24, 1997). In addition remain readily achievable using these
manufacturers’ observation that there to the gradual phase-in of Tier 4 tests, and we anticipate that no
are engines above 75 hp without standards over several years, we are additional engine adjustments are
turbocharging or electronic controls. adopting significant flexibility necessary for the standards to be
However, EPA did not choose the 75 hp provisions specifically to provide achievable (so there are no significant
cutpoint with the expectation that all adequate lead time for equipment associated costs). We also explain there
engines above it had the same manufacturers to make the transition to that the CO standards can be achieved
technology characteristics. There is a the new standards, including some without jeopardizing the ability to
continuum in the degree to which key provisions that provide additional achieve all of the other engine
technology characteristics exist on flexibility from what we proposed, as standards.
engines throughout the power spectrum, explained in section III.B.
and the 75 hp cutpoint was based on 7. Crankcase Emissions Control
information from the current fleet of 6. CO Standards We currently require the control of
engines and on manufacturers’ and We proposed minor changes in CO crankcase emissions from naturally
EPA’s expectations for future design standards for some engines solely for aspiriated nonroad diesel engines. We
trends, showing there is a marked the purpose of helping to consolidate proposed to extend this requirement to
difference in the prevalence of these and power categories. We stated in the turbocharged nonroad diesel engines as
other key engine design characteristics proposal that we were not exercising well, starting in the same model year
for engines above and below 75 hp, and our authority to revise the CO standard that Tier 4 exhaust emission standards
that, over time, 75–100 hp engines for the purpose of improving air quality, first apply in each power category.
increasingly share advanced technology but rather for purposes of administrative EMA opposed the proposed
characteristics common in larger efficiency. However, manufacturers extension, reiterating concerns
engines. Clear evidence of this trend objected to these proposed changes, expressed in comments on a similar
over recent model years is documented citing technological feasibility concerns, proposed provision in the 2007 heavy-
in the RIA, section 4.1.4. As discussed and a lack of parity with highway diesel duty highway rule, including concerns
in section II.B.2, the kind of engine and nonroad spark-ignition engines, over the impact that recirculating
technology generally employed by given that existing CO standards levels crankcase emissions may have on the
engines in the 75–100 hp range, for nonroad engines are already five feasibility of engine standards over the
combined with the lead time and phase- times lower than the standard level for full useful life. These concerns are
in provided for the Tier 4 NOX highway engines. addressed in the Summary and Analysis
standards, leads us to conclude that Because we proposed the CO standard of Comments document for that rule,
highway-like NOX aftertreatment can be changes for the sake of simplifying and which is included in the docket for
transferred to these engines. In addition, consolidating power categories and not today’s rule. Besides the feasibility
since our proposal, the Council of the because of any technical considerations issues raised by EMA for nonroad
European Union (EU) has issued a relating to emission reductions, we do diesels that are addressed in the
revised final version of new nonroad not believe it productive to take issue highway rule, two nonroad-specific
diesel emission standards that with the views expressed that these issues were raised as well: (1) The need
essentially aligns their power cutpoints proposed changes raise serious to design crankcase emission control
with our own, including adoption of the feasibility concerns. We instead are systems that operate at the high
75 hp cutpoint for advanced technology withdrawing this aspect of the proposal, angularity experienced by some
nonroad machines on uneven ground, manufacturers, stressing the need for As the EU program does not provide
and (2) the concern that this EPA to work with other governmental for emissions averaging, the alternative
requirement adds to the large number of standards-setting bodies to harmonize NOX standards we are setting for 75–750
‘‘first time’’ requirements being adopted standards. We recognize the importance hp engines are the NOX levels at which
for Tier 4. We agree that high angularity of harmonization of international the EU standards are generally aligned
operation may add new design standards and have worked diligently during our NOX phase-in years. The EU
considerations for these controls, but do with our colleagues in Europe and Japan Directive also includes transition
not see how it would pose a serious to achieve that objective. Harmonization flexibility provisions for equipment
barrier that could not be overcome in of these standards will allow manufacturers similar to those in our
time. The grouping of new EPA manufacturers continued access to program, discussed in section III.B.
requirements in a specific model year is world markets and lower the required The EU program for nonroad diesels
an important objective of our program research and development and tooling has not adopted or proposed any current
aimed at providing stability to the costs needed to meet different or future standards for engines above
design process, a goal much supported standards. We will continue to work 750 hp or below 25 hp, and its revised
by the engine manufacturers. We have with standards-setting governmental Directive for 25–50 hp engines does not
accounted for this in assessing entities and with foreign and domestic subject them to any future standards
feasibility, costs, and flexibility needs manufacturers. beyond those entering into force in 2007
for the program. One flexibility we are In October 2003, the Council and (equivalent to 0.45 g/bhp-hr PM and 5.6
providing is the three-path opportunity Parliament of the European Union g/bhp-hr hydrocarbon+NOX), in contrast
to satisfy our crankcase control reached agreement on revisions to a to our 2013 standards based the use of
requirement, as described below. In fact, proposal developed by the European PM filters and more advanced engine-
in its written comments EMA Commission that would amend based control technologies (0.02 g/bhp
recommended that, if EPA were to Directive 97/68/EC to include nonroad hr PM and 3.5 g/bhp-hr NMHC+NOX).
proceed with crankcase emission diesel emissions standards similar to However, as discussed further in section
control requirements for Tier 4, it adopt those in our Tier 4 program, and, as in VIII.A, the EU Directive includes plans
all three options for demonstrating the U.S., coordinated with low sulfur to conduct a future technology review of
compliance. This is indeed what we are diesel fuel requirements in Europe. This appropriate standards for engines below
doing. revised proposal has since been 50 hp and above 750 hp. The year that
Thus, as proposed, in addition to finalized.34 This revised Directive aligns this is planned for is 2007, the same
allowing for compliance through the well with our program in the Tier 4 time year in which we are planning a
routing of crankcase emissions to the technology review for engines below 75
frame, even more so than did the
engine air intake system, we are also hp. Considering progress to date, and
original Commission proposal. It also
allowing manufacturers to instead meet announced plans for reviews in 2007,
closely aligns with our Tier 3 standards
the requirement by routing the we believe that prospects for
in the Tier 3 time frame.
crankcase gases into the exhaust stream, harmonized standards are excellent.
provided they keep the combined total For engines of 50–750 hp, the
Directive’s standards are very closely 9. Exclusion of Marine Engines
of the crankcase emissions and the
exhaust emissions below the applicable aligned with our own Tier 4 standards, For reasons outlined in the proposal,
exhaust emission standards. Also as including emissions levels, we are not applying Tier 4 standards to
proposed, we are allowing implementation dates, the defined the marine diesel engines under 50 hp
manufacturers to instead meet the power categories, and the lower hp limit that are covered under our Tier 1 and
requirement by measuring crankcase of NOX control based on high-efficiency 2 standards. We believe it is more
emissions instead of completely exhaust emission controls (75 hp). appropriate to consider more stringent
eliminating them, provided Exceptions are noted below: standards for a range of marine diesel
manufacturers add these measured • The 2008 PM standard level for 50– engines, including these, in a future
emissions to exhaust emissions in 75 hp engines (the equivalent of 0.3 g/ action. It should be noted that the
assessing compliance with exhaust bhp-hr vs our 0.22 g/bhp-hr level). Note, existing Tier 2 standards will continue
emissions standards. Manufacturers however, that we do allow certification to apply to marine diesel engines under
using this option must also modify their to the 0.3 g/bhp-hr level as an option, 50 hp until that future action is
exhaust deterioration factors or develop provided the manufacturer must then completed. We did not receive any
separate deterioration factors to account meet our 0.02 g/bhp-hr standard in adverse comments on this proposed
for increases in crankcase emissions as 2012, one year earlier than otherwise. approach.
the engine ages, and must ensure that • The 2013 PM standard level for 50–
B. Are the New Standards Feasible?
crankcase emissions can be readily 75 hp engines (the equivalent of 0.01 g/
measured in use. We see no reason to bhp-hr vs our 0.02 g/bhp-hr level). Today we are finalizing a program of
treat naturally-aspirated engines • An October 1, 2014 start for the stringent new standards for a broad
differently than turbocharged engines, final 75–175 hp NOX standard (the same category of nonroad diesel engines
and so are allowing these options for all as our proposed date), compared to the coupled with a new nonroad diesel fuel
Tier 4 engines subject to the crankcase December 31, 2014 date we are adopting standard that dramatically lowers the
control requirement, both turbocharged in this final rule. sulfur level in nonroad diesel fuel
and naturally-aspirated. The wording of • For constant speed engines: no Tier ultimately to 15 ppm. We believe these
the proposed regulations limiting the 4-equivalent standards. Also, the EU’s standards are technically feasible in the
options to turbocharged engines was Tier 3-equivalent standards are not leadtime provided given the availability
inadvertent. implemented on these engines until of 15 ppm sulfur fuel and the rapid
2011–2012. progress to develop the needed emission
8. Prospects for International control technologies. We acknowledge,
Harmonization as pointed out by a number of
34 Council of the European Union, ‘‘Directive of
We received numerous comments, the European Parliament and of the Council commenters, that these standards will
especially from engine and equipment amending Directive 97/68/EC’’, March 15, 2004. be challenging for industry to meet, in
part due to differences in operating these technologies to nonroad engines power and can vary dramatically as
conditions and duty cycles for nonroad and why we believe the emission engine power demands vary. For
equipment and the diesel engines used standards finalized today are technically catalyzed diesel particulate filters
in that equipment. Also, we recognize feasible in the leadtime provided. (CDPFs), exhaust temperature
that transferring and effectively determines the rate of filter
1. Can Advanced Diesel Emission
applying these technologies, which have regeneration, and if too low, causes a
Control Technologies Be Applied to
largely been developed for highway need for supplemental means to ensure
Nonroad Engines and Equipment?
engines, will require additional time proper filter regeneration. In the case of
after the application of the technology to The emission standards and the the CDPF, it is the aggregate soot
on-highway engines. Diesel engine introduction dates for those standards, regeneration rate that is important, not
industry commenters and as described earlier in this section, are the regeneration rate at any particular
environmental stakeholder commenters premised on the transfer of diesel moment in time. A CDPF controls PM
on our proposal consistently agreed engine technologies being or already emissions under all conditions and can
with our position that for most engine developed to meet light-duty and heavy- function properly (i.e., not plug) even
horsepower categories the technologies duty vehicle standards that begin in when exhaust temperatures are low for
to meet the standards exist and that the 2007. The advanced technology an extended time and the regeneration
transfer of these technologies to nonroad standards that we are finalizing today rate is lower than the soot accumulation
is possible. The biggest difference of for engines over 25 horsepower will rate, provided that occasionally exhaust
opinions in the range of comments begin to go into effect four years later. temperatures and thus the soot
received by the Agency concerns the This time lag between equivalent regeneration rate are increased enough
timing of the emission standards and highway and nonroad diesel engine to regenerate the CDPF. Similarly, there
the flexibility provisions (i.e., the standards is necessary in order to allow is a minimum temperature (e.g., 200 °C)
leadtime necessary to transfer the time for engine and equipment for NOX adsorbers below which NOX
technology). One of the most important manufacturers to further develop these regeneration is not readily possible and
tasks for a feasibility analysis is to highway technologies for nonroad a maximum temperature (e.g., 500 °C)
determine the appropriate amount of engines and to align this program with above which NOX adsorbers are unable
development time needed to nonroad Tier 3 emission standards that to effectively store NOX. Therefore,
successfully bring new technologies to begin to go into effect in 2006. there is a need to match diesel exhaust
market. We have carefully weighed the This section summarizes the
temperatures to conditions for effective
desire to have clean engines sooner, engineering challenges to applying
catalyst operation under the various
with the challenges yet to be overcome advanced emission control technologies
operating conditions of nonroad
in applying the technologies to nonroad to nonroad engines and equipment, and
engines.
engines and equipment, in determining why we believe that technologies
developed for highway diesel engines Although the range of products for
the appropriate timing and emission highway vehicles is not as diverse as for
levels for the standards finalized today. can be further refined to address these
issues in a timely manner for nonroad nonroad equipment, the need to match
The RIA associated with today’s exhaust temperatures to catalyst
action contains a detailed description engines consistent with the emission
standards finalized today. characteristics is still present. This is an
and analysis of diesel emission control important concern for highway engine
technologies, issues specific to applying a. Nonroad Operating Conditions and manufacturers and has been a focus of
these technologies to nonroad engines, Exhaust Temperatures our ongoing 2007 diesel engine progress
and why we believe the new emission review. There we have learned that
Nonroad equipment is highly diverse
standards are feasible. Additional in- substantial progress is being made to
in design, application, and typical
depth discussion of these technologies broaden the operating temperature
operating conditions. This variety of
can be found in the final RIA for the window of catalyst technologies while
operating conditions affects emission
HD2007 emission standards, the final at the same time to design engine
control systems through the resulting
RIA for the HD2004 emission standards, systems to better control average
variety in the torque and speed
the 2002 Highway Diesel Progress exhaust temperatures (for ongoing
demands (i.e., power demands). In our
Review and the recently released catalyst performance) and to attain
proposal, we highlighted the challenge
Highway Diesel Progress Review Report periodically higher temperatures (to
for design and implementation of
2.35 36 37 38 The following sections control PM filter regeneration and NOX
advanced emission control technologies
summarize the challenges to applying adsorber desulfation). Highway diesel
posed by this wide range in what
35 Regulatory Impact Analysis: Heavy-Duty
constitutes typical nonroad operation. engine manufacturers are working to
Engine and Vehicle Standards and Highway Diesel Some commenters emphasized their address this need through modifications
Fuel Sulfur Control Requirements, United States concerns regarding this issue as well, to engine design, modifications to
Environmental Protection Agency, December 2000, and their belief that these issues make engine control strategies, and
EPA420–R–00–026. Copy Available in EPA Air modifications to exhaust system
Docket A–2001–28 Item II–A–01.
the application of the technology to
36 Regulatory Impact Analysis: Control of nonroad infeasible. While we recognize designs. New engine control strategies
Emissions of Air Pollution from Highway Heavy- and agree with the commenters designed to take advantage of engine
Duty Engines, United States Environmental regarding the nature of the challenges, and exhaust system modifications can
Protection Agency, June 2000, EPA420–R–00–010. we disagree with their conclusion be used to manage exhaust temperatures
Copy available in EPA Air Docket A–2001–28 Item
II–A–02. regarding feasibility because, as across a broad range of engine
37 Highway Diesel Progress Review, United States described in the following section, we operation. The technology solutions
Environmental Protection Agency, June 2002, EPA see a clear path to overcome the being developed for highway engines to
420–R–02–016. Copy available in EPA Air Docket challenges. better manage exhaust temperature are
A–2001–28 Item II–A–52. The primary concern for catalyst- built upon the same emission control
38 Highway Diesel Progress Review Report 2,
United States Environmental Protection Agency,

based emission control technologies is technologies (i.e., advanced air handling
March 2004, EPA420–R–04–004. Copy available in exhaust temperature. In general, exhaust systems and electronic fuel injection
Docket OAR–2003–0012–0918. temperature increases with engine systems) that we expect nonroad engine
manufacturers to use in order to comply performance than passenger car urban equipment operating characteristics,
with the existing Tier 3 emission driving. Both the Toyota and PSA that, in use, some nonroad engines will
standards. systems are designed to function even experience conditions that require the
Matching the emission control with extended idle operation as would use of temperature management
technology and the operating be typified by a taxi waiting to pick up strategies (e.g., active regeneration) in
temperature window of the broad range a fare. order to effectively use the NOX
of nonroad equipment may be It is our conclusion that by actively adsorber and CDPF systems. We have
somewhat more challenging for nonroad managing exhaust temperatures, for assumed in our cost analysis that all
engines than for many highway diesel example through engine management to nonroad engines complying with a PM
engines simply because of the diversity increase exhaust temperatures, engine standard of 0.03 g/bhp-hr or lower will
in equipment design and equipment manufacturers can ensure highly have an active means to control
use. Nonetheless, the problem has been effective catalyst-based emission control temperature (i.e. we have costed a
successfully solved in highway performance (i.e., compliance with the backup regeneration system, although
applications facing low exhaust emission standards across the some applications likely may not need
temperature performance situations as applicable tests) and reliable filter one). We have made this assumption
difficult to address as any encountered regeneration across a wide range of believing, as indicated by a number of
by nonroad applications. The most engine operation as would be typified commenters, that manufacturers will
challenging temperature regime for by the broad range of in-use nonroad not be able to accurately predict in-use
highway engines are encountered at duty cycles. Active methods of conditions for every piece of equipment
very light-loads as typified by congested regenerating PM filters have been shown and will thus choose to provide the
urban driving with periods of extended to be reliable under all operating technologies on a back-up basis. As
idle operation. Under congested urban conditions and can be applied to explained earlier, the technologies
driving conditions, exhaust nonroad diesel engines in the time necessary to accomplish this
temperatures may be too low for frame required by these regulations. The temperature management are
effective NOX reduction with a NOX additional cost for active regeneration, enhancements of both the Tier 3
adsorber catalyst. Similarly, exhaust beyond the cost for the PM filter alone, emission control technologies that will
temperatures may be too low to ensure has been accounted for in the cost form the starting point for Tier 4 engines
passive CDPF regeneration. To address analysis summarized in section VI of larger than 50 hp, and the control
these concerns, light-duty diesel engine this preamble. strategies being developed for highway
manufacturers have developed active We have conducted an analysis of diesel engines.41 Based on our analyses,
temperature management strategies that various nonroad equipment operating we believe that there are no nonroad
provide effective emissions control even cycles and various nonroad engine engine applications above 25
under these difficult light-load power density levels to better horsepower for which these highway
conditions. Toyota has shown with their understand the matching of nonroad engine approaches for temperature
prototype diesel particulate NOX engine exhaust temperatures, catalyst management will not work. However,
reduction (DPNR) vehicles that changes installation locations and catalyst we agree with commenters that given
to EGR and fuel injection strategies can technologies. This analysis, documented the diversity in nonroad equipment
realize an increase in exhaust in the RIA, shows that for many engine design and application, additional time
temperatures of more than 100 °F under power density levels and equipment will be needed in order to match the
even very light-load conditions allowing operating cycles, exhaust temperatures
engine performance characteristics to
the NOX adsorber catalyst to function are quite well matched to catalyst
the full range of nonroad equipment.
under these normally cold exhaust temperature window characteristics. In We have concluded that, given the
conditions.39 Similarly, PSA Peugeot particular, the nonroad transient cycle timing of the emissions standards
Citroen (PSA) has demonstrated (NRTC), the cycle we are finalizing to finalized today, and the availability and
effective CDPF regeneration under use for certification for most engines continuing development of technologies
demanding light-load taxi cab with rated power less than 750 hp, was to address temperature management for
conditions with current production shown to be well matched to the NOX highway engines which technologies are
technologies. 40 Both of these are adsorber characteristics with estimated
transferrable to all nonroad engines with
examples of technology paths available performance in excess of 90 percent for
greater than 25 hp power rating,
to nonroad engine manufacturers to a turbocharged diesel engine tested
nonroad engines can be designed to
increase temperatures under light-load under a range of power density levels.
meet the new standards in the lead time
conditions. The analysis also indicated that the
provided, and can be provided to
While a number of commenters exhaust temperatures experienced over
equipment makers in a timely manner
expressed concerns about low the NRTC are better matched to the NOX
within that lead time.
temperature operation for nonroad adsorber catalyst temperature window
equipment, no commenters provided than the temperatures that would be b. Nonroad Operating Conditions and
data showing that nonroad equipment expected over the highway FTP test Durability
in-use operating cycles would be more cycle. This suggests (when coupled with Nonroad equipment is designed to be
demanding of low temperature the fact that PM filters function with used in a wide range of tasks, from
equal effectiveness at essentially all mining equipment to crop cultivation
39 Sasaki, S., Ito, T., and Iguchi, S., ‘‘Smoke-less
conditions) that compliance based on and harvesting to excavation and
Rich Combustion by Low Temperature Oxidation in testing with the nonroad Tier 4
Diesel Engines,’’ 9th Aachener Kolloquim
Fahrzeug—und Motorentechnik 2000. Copy standards on the NRTC will be 41 We do not have Tier 3 emission standards for
available in EPA Air Docket A–2001–28 Item II–A– somewhat easier, using similar engines in the horsepower category from 25–50 hp.
56. technology, than complying with the However, we expect that similar Tier 3 emission
40 Jeuland, N., et al., ‘‘Performances and
highway 2007 emission standards on control technologies will form part of the emission
Durability of DPF (Diesel Particulate Filter) Tested control technology package used for compliance
on a Fleet of Peugeot 607 Taxis First and Second the highway transient test cycle. with the Tier 4 standards for these engines in 2013.
Test Phases Results,’’ October 2002, SAE 2002–01– In sum, we believe based on our Our cost analysis reflects the additional cost to
2790. analysis of nonroad engines and apply these technologies for NOX and PM control.
loading, and operated in harsh or catalyst housing.42 The Deutz system engines. Those standards are discussed
environments. In the normal course of utilized a conventional cordierite PM in sections II.A and II.B.3 below. Our
equipment operation the engine and its filter substrate as is commonly used for cost estimates summarized in section VI
associated hardware will experience heavy-duty highway truck CDPF for engines greater than 750 hp are
levels of vibration, impacts, and dust systems. The canning and mounting of consistent with the use of either silicon
that may exceed conditions typical of the system was a Deutz design. Deutz carbide or wire mesh PM filter
highway diesel vehicles. For this reason, was able to design the catalyst housing technologies.
some commenters said that the PM filter and mounting in such a way as to Certain nonroad applications,
technology was infeasible for nonroad protect the catalyst from the harsh including some forms of harvesting
equipment. We disagree with this environment as evidenced by its equipment, consumer lawn and garden
excellent record of reliable function. equipment, and mining equipment, may
assertion and continue to believe that
A number of commenters asserted have specific limits on maximum
PM filter technologies can be applied to
that it was not possible to apply surface temperature for equipment
a wide range of nonroad equipment.
conventional CDPF technologies (i.e., components in order to ensure that the
Specific efforts to design for the ceramic wall-flow filter media) to the components do not serve as ignition
nonroad operating conditions will be largest diesel engines with power sources for flammable dust particles
required in order to ensure that the ratings above 750 hp. In the draft RIA (e.g., coal dust or fine crop/lawn dust).
benefits of these new emission control for the proposal, we described our Some commenters have raised concerns
technologies are realized for the life of expectation that these highway-based that these design constraints might limit
nonroad equipment. Much of the systems could be assembled into larger the equipment manufacturers ability to
engineering knowledge and experience systems to work well for these largest install advanced diesel catalyst
to address these issues already exists diesel engines. While we continue to technologies such as NOX adsorbers and
with the nonroad equipment believe that it may be possible in the CDPFs. This concern seems to be largely
manufacturers. Vibration and impact time frame of this rulemaking for these based upon anecdotal experience with
issues are fundamentally mechanical conventional CDPFs to be applied to gasoline catalyst technologies where
durability concerns (rather than issues engines with more than 750 hp, based under certain circumstances catalyst
of technical feasibility of achieving on the evidence provided by the temperatures can exceed 1,000 °C and
emissions reductions) for any commenters, we now agree that too without appropriate design
component mounted on a piece of much uncertainty remains for us to considerations could conceivably serve
equipment (e.g., an engine coolant reach that conclusion today. We cannot as an ignition source. We do not believe
overflow tank). Equipment clearly today describe a method to that these concerns are justified in the
manufacturers must design mounting monitor the soot loading of individual case of either the NOX adsorber catalyst
hardware such as flanges, brackets, and filter elements in a parallel system made or the CDPF technology. Catalyst
bolts to support the new component up of a significant number of smaller temperatures for NOX adsorbers and
without failure. Further, the catalyst components. This is because for parallel CDPFs should not exceed the maximum
substrate material itself must be able to systems the pressure drop (the best exhaust manifold temperatures already
withstand the conditions encountered current method to monitor filter commonly experienced by diesel
condition) across all of the parallel engines (i.e., catalyst temperatures are
on nonroad equipment without itself
components is exactly the same. If a expected to be below 800 °C).43 CDPF
cracking or failing. There is a large body
single filter begins to plug and needs to temperatures are not expected to exceed
of real world testing with retrofit
be regenerated it may not be detected in approximately 700 °C in normal use and
emission control technologies on
such a system. Therefore, we believe are expected to only reach the 650 °C
engines up to 750 hp that demonstrate
that instead of a massively parallel filter temperature during periods of active
the durability of the catalyst regeneration. Similarly, NOX adsorber
components themselves even in the system, an alternate PM filtering media
may be more appropriate in order to catalyst temperatures are not expected
harshest of nonroad equipment to exceed 700 °C and again only during
applications. The evidence for even address issues of scalability, durability
and packaging for these largest engines. periods of active sulfur regeneration as
larger engines (i.e., those above 750 hp) described in section III.C below. Under
is less conclusive because of the limited Fortunately, there are other filter media
technologies (e.g., wire or fiber mesh conditions where diesel exhaust
number of applications. temperatures are naturally as high as
depth filters) that can be successfully
Deutz, a nonroad engine scaled to any size and which we have 650 °C, no supplemental heat addition
manufacturer, sold approximately 2,000 confidence in projecting today will be a from the emission control system will
diesel particulate filter systems for more appropriate solution for the bulk be necessary for regeneration and
nonroad equipment in the period from of the engines in this size category. therefore exhaust temperatures will not
1994 through 2000. The very largest of Because these depth filtration exceed their natural level. When natural
these systems were limited to engine technologies are not quite as efficient at exhaust temperatures are too low for
sizes below 850 hp. The majority of filtering PM as the ceramic systems that effective emission system regeneration
these systems were sold into are the dominant solution for the 43 The hottest surface on a diesel engine is
significantly smaller applications. Many smaller highway diesel engines, we are typically the exhaust manifold which connects the
of these systems were sold for use in finalizing a set of PM filter-based engines exhaust ports to the inlet of the
mining equipment. Mining equipment is standards for engines greater than 750 turbocharger. The hot exhaust gases leave the
exposed to extraordinarily high levels of hp which are slightly higher than the engine at a very high temperature (800 °C at high
vibration, experiences impacts with the power conditions) and then pass through the
proposed PM standards for these turbocharger where the gases expand driving the
mine walls and face, and encounters turbocharger providing work. The process of
high levels of dust. Yet in meetings with 42 ‘‘Summary of Conference Call between U.S. extracting work from the hot gases cools the exhaust
the Agency, Deutz shared their EPA and Deutz Corporation on September 19, 2002 gases. The exhaust leaving the turbocharger and
regarding Deutz Diesel Particulate Filter System’’, entering the catalyst and the remaining pieces of the
experience that no system had failed EPA Memorandum to Air Docket A–2001–28 Item exhaust system is cooler (as much as 200 °C at very
due to mechanical failure of the catalyst II–B–31. high loads) than in the exhaust manifold.
then supplemental heating, as described that would not commonly be engines regardless of engine size. The
earlier, may be necessary but would not experienced by highway vehicles. We effectiveness of NOX adsorbers to
be expected to produce temperatures believe further as demonstrated by control NOX emissions and CDPFs to
higher than the maximum levels retrofit experiences around the world control PM, NMHC, and CO emissions
normally encountered in diesel exhaust. that technical solutions exist which are determined by fundamental catalyst
Furthermore, even if it were necessary allow catalyst-based emission control and filter characteristics. Therefore, we
to raise exhaust temperatures to a higher technologies to be applied to nonroad disagree with commenters who suggest
level in order to promote effective equipment. that these highway technology based
emission control, there are technologies emission standards are infeasible for
2. Are the Standards for Engines 75–750
available to isolate the higher exhaust nonroad engines. We acknowledge the
hp Feasible?
temperatures from flammable materials comments raised regarding the unique
such as dust. One approach would be There are three primary test characteristics nonroad diesel engines
the use of air-gapped exhaust systems provisions and associated standards in which must be considered in setting
(i.e., an exhaust pipe inside another the Tier 4 program we are finalizing these standards, and we have addressed
concentric exhaust pipe separated by an today. These are the Nonroad Transient those issues by allowing (where
air-gap) that serve to insulate the inner Cycle (NRTC), the existing International appropriate) for additional lead time or
high temperature surface from the outer Organization for Standardization (ISO) slightly less stringent standards for
surface which could come into contact C1 steady-state cycle, and the highway- nonroad diesel engines in comparison to
with the dust. The use of such a system based Not-To-Exceed (NTE) highway diesel engines (and likewise
also may be desirable in order to provisions.46 Under today’s rules, most have made appropriate cost estimates to
maintain higher exhaust temperatures nonroad diesel engines must meet the account for the technology and
inside the catalyst in order to promote new standards for each of these three engineering needed to address these
better catalyst function. Another test cycles (the exceptions are noted issues).
technology to control surface below). Compliance on the transient test
cycle includes weighting the results PM Standard. We are finalizing a PM
temperature already used by some standard for engines in this category of
nonroad equipment manufacturers is from a cold start and hot start test with
the cold start emissions weighted at 1/ 0.01 g/bhp-hr based upon the emissions
water cooled exhaust systems.44 This reductions possible through the
approach is similar to the air-gapped 20 and hot start emissions weighted at
19/20. Additionally, we have alternative application of a CDPF and 15 ppm
system but uses engine coolant water to sulfur diesel fuel. This is the same
actively cool the exhaust system. optional test cycles including the
existing ISO–D2 steady-state cycle and emissions level as for highway diesel
We thus do not believe that engines in the heavy-duty 2007
flammable dust concerns will prevent the Transportation Refrigeration Unit
(TRU) cycle which a manufacturer can (HD2007) program (66 FR 5001, January
the use of either a NOX adsorber or a 18, 2001). While emission levels of
CDPF because catalyst temperatures are choose to use for certification in lieu of
the NRTC and the ISO–C1, provided engine-out soot (the solid carbon
not expected to be unacceptably high fraction of PM) may be somewhat higher
and because remediation technologies that the manufacturer can demonstrate
to the Agency that the engine will only for some nonroad engines when
exist to address these concerns. In fact, compared to highway engines, these
exhaust emission control technologies be used in a limited range of nonroad
equipment with known operating emissions are virtually eliminated
(i.e., aftertreatment) have already been (reduced by 99 percent) by the CDPF
applied on both an original equipment conditions. A complete discussion of
these various test cycles can be found in technology. With application of the
manufacturer (OEM) basis and for CDPF technology, the soluble organic
retrofit to nonroad equipment for use in chapter 4.2, 4.3, and 4.4 of the RIA.
The standards we are finalizing today fraction (SOF) portion of diesel PM is
potentially explosive environments. predicted to be all but eliminated. The
for nonroad engines with rated power
Many of these applications must primary emissions from a CDPF
from 75 to 750 hp are based upon the
undergo Underwriters Laboratory (UL) equipped engine are sulfate PM
performance of technologies and
approval before they can be used.45 emissions formed from sulfur in diesel
standards for highway diesel engines
Therefore, while we appreciate the fuel. The emissions rate for sulfate PM
which go into effect in 2007. As
commenters’ concerns regarding safety, is determined primarily by the sulfur
explained above, we believe these
we remain convinced that the technologies, namely NOX adsorbers level of the diesel fuel and the rate of
application of these emission control and catalyzed diesel particulate filters fuel consumption. With the 15 ppm
technologies will not compromise (or enabled by 15 ppm sulfur diesel fuel, sulfur diesel fuel, the PM emissions
decrease) equipment safety. can be applied to nonroad diesel level from a CDPF equipped nonroad
We agree that nonroad equipment diesel engine will be similar to the
engines in a similar manner as for
must be designed to address safety and emissions rate of a comparable highway
highway diesel engines. The
durable performance for a wide range of diesel engine. Therefore, the 0.01 g/bhp
combustion process and the means to
operating conditions and applications
modify that process are fundamentally hr emission level is feasible for nonroad
44 ‘‘Engine Technology and Application Aspects
the same for highway and nonroad engines tested on the NRTC cycle and
for Earthmoving Machines and Mobile Cranes,’’ Dr. diesel engines regardless of engine size. on the steady-state cycles, ISO–C1 and
E. Brucker, Liebherr Machines Bulle, SA, AVL The formation mechanism and quantity ISO–D2. Put another way, control of PM
International Commercial Powertrain Conference, of pollutants formed in diesel engines using CDPF technology is essentially
October 2001. Copy available in EPA Air Docket A– are fundamental characteristics of independent of duty cycle given active
2001–28, Docket Item # II–A–12.
45 Phone conversation between Byron Bunker,
engine design and are not inherently catalyst technology (for reliable
United States Environmental Protection Agency and different for highway and nonroad regeneration and SOF oxidation),
Dale McKinnon, Manufacturers of Emission Control adequate control of temperature (for
Association (MECA), 9 April, 2003 confirming the 46 As an alternative to compliance with the ISO
reliable regeneration) and low sulfur
use of emission control technologies on nonroad C1 test procedure, a manufacturer can show
equipment used in coal mines, refineries, and other compliance with the standards by testing over the
diesel fuel (for reliable regeneration and
locations where explosion proofing may be Ramped Modal Cycle (RMC) as described in section low PM emissions). While some
required. III.F. commenters argued that PM filters will
not enable the 0.01 PM emission learning that will be realized from the would prevent achieving the NTE
standard for nonroad engines, we introduction of these same technologies standard.
remain convinced by the demonstration to highway diesel engines, plus the lack Under the brief episodic periods of
of 0.01 or lower PM emission levels of any fundamental technical rich operation necessary to regenerate
from a number of diesel engines impediment, makes us confident that NOX adsorber catalysts, it is possible to
described in the RIA, that the standard the new NOX standards can be met. briefly experience higher levels of
is feasible given the leadtime provided NMHC emissions. Absent a controlling
Given the fundamental similarities
and the availability of 15 ppm sulfur standard, it is possible that these NMHC
between highway and nonroad diesel
diesel fuel. Likewise, the NTE emissions could be high. There are two
engines, we believe that the NOX
provisions for nonroad engines are the possible means to control the NMHC
adsorber technology developed for emissions during these periods in order
same as for on-highway engines meeting
highway engines can be applied with to meet the NMHC standard finalized
an equivalent PM control level. The
equal effectiveness to nonroad diesel today. Manufacturers can design the
maximum PM emission level from a
CDPF equipped diesel engine is engines with additional developments regeneration system and the oxygen
primarily determined by the maximum in engine thermal management (as storage (oxidation function under rich
fuel sulfur conversion level experienced discussed in section II.B.2 above) to conditions) of the NOX adsorber catalyst
at the highest operating conditions. As address the more widely varied nonroad such that the NMHC emissions are
documented in RIA chapter 4.1.1.3, operating cycles. In fact, as discussed inherently controlled. This is similar to
testing of diesel engines at conditions previously, the NOX adsorber catalyst the control realized on today’s three-
representative of the highest sulfate PM temperature window is particularly well way automotive catalysts which also
formation rates shows PM levels below matched to transient operating experience operation that toggles
the level required by the NTE provisions conditions as typified by the NRTC. between rich and lean conditions.
when tested on less than 15 ppm sulfur As pointed out by some commenters, Secondly, a downstream clean-up
diesel fuel. compliance with the NTE provisions catalyst can be used to oxidize the
NOX Standard. We are finalizing a will be challenging for the nonroad excess NMHC emissions to a level
NOX standard of 0.30 g/bhp-hr for engine industry due to the diversity of below the standard. This approach has
engines in this category based upon the nonroad products and operating cycles. been used in the NOX adsorber
emission reductions possible from the However, the technical challenge is demonstration program at EPA
application of NOX adsorber catalysts reduced somewhat by the 1.5 multiplier described in the RIA. Our cost analysis
and the expected emission levels for used to calculate the NTE standard as for engines in the 75 to 750 hp category
Tier 3 compliant engines which form discussed in section III.J. Controlling includes a cost for a clean-up catalyst to
the baseline technology for Tier 4 NOX emissions under NTE conditions is perform this function.
engines. The Tier 3 emission standards fundamentally similar for both highway Cold Start. The standards include a
are a combined NMHC+NOX standard of and nonroad engines. The range of cold start provision for the NRTC
3.0 g/bhp-hr for engines greater than 100 control is the same and the amount of procedure. This means that the results
hp and less than 750 horsepower. For reduction required is also the same. We of a cold start transient test will be
engines less than 100 hp but greater know of no technical impediment, nor weighted with the emissions of a hot
than 50 horsepower the Tier 3 were any raised by commenters, that start test in order to calculate the
NMHC+NOX emission standard is 3.5 g/ would prevent achieving the NTE emissions for compliance against the
bhp-hr. We believe that in the time- standard under the zone of operating standards. In a change from the
frame of the Tier 4 emission standards, conditions required by the NTE. proposed rule, the weightings are 1/20
all engines from 75 to 750 hp can be cold start and 19/20 for the hot start (as
developed to control NOX emissions to NMHC Standard. Meeting the NMHC opposed to the proposed weightings of
engine-out levels of 3.0 g/bhp-hr or standard under the lean operating 1/10 and 9/10, respectively) as
lower.47 This means that all engines will conditions typical of the biggest portion described more fully in chapter 4.2 of
need to apply Tier 3 emission control of NOX adsorber operation should not the RIA and section III.F below. Because
technologies (i.e., turbochargers, charge- present any special challenges to exhaust temperatures are so important
air-coolers, electronic fuel systems, and nonroad diesel engine manufacturers. to catalyst performance, a cold start
for some manufacturers EGR systems) to Since CDPFs and NOX adsorbers contain provision is an important tool to ensure
get to this baseline level. As discussed platinum and other precious metals to that the emissions realized in use are
in more detail in the RIA, our analysis oxidize NO to NO2, they are also very consistent with the expectations of this
of the NRTC and the ISO–C1 cycles efficient oxidizers of hydrocarbons. program. Achieving this standard
indicates that the NOX adsorber catalyst NMHC reductions of greater than 95 represents an additional technical
can provide a 90 percent or greater NOX percent have been shown over transient challenge for NOX control and to a
reduction level on the cycles. The and steady-state test procedures.48 lesser extent CO and NMHC control
standard of 0.30 g/bhp-hr reflects a Given that typical engine-out NMHC is (i.e., control of gaseous pollutants). PM
baseline emissions level of 3.0 g/bhp-hr expected to be in the 0.40 g/bhp-hr control with a CDPF is not expected to
and a greater than 90 percent reduction range or lower for engines meeting the be significantly impacted by cold-start
of NOX emissions through the Tier 3 standards, this level of NMHC provisions due to the primary filter
application of the NOX adsorber reduction will mean that under lean mechanism being largely unaffected by
catalyst. The additional lead time conditions emission levels will be well temperature.
available to nonroad engine below the standard. For the same With respect to achievability of the
manufacturers and the substantial reasons, there is no obstacle which NOX, CO and NMHC standards, during
the initial start and warmup period for
47 For engines between 75 and 100 horsepower, 48 ‘‘The Impact of Sulfur in Diesel Fuel on a diesel engine, the exhaust
this may require re-optimization of the engine to Catalyst Emission Control Technology,’’ report by temperatures are typically below the
lower NOX emissions if they are higher than 3.0, but the Manufacturers of Emission Controls
we would not expect any new hardware beyond the Association, March 15, 1999, pp. 9 & 11. Copy
light-off temperature of a catalyst. As a
Tier 3 hardware to be required in the Tier 4 available in EPA Air Docket A–2001–28 Item II–A– result, exhaust stack emissions may
timeframe to accomplish this reduction. 67. initially be higher during this period of
operation. The cold start test procedure example, even if the average NOX combination of technologies that we
is designed to quantify these emissions adsorber performance over the cold-start expect will be used to meet those
to ensure that emission control systems test cycle was only 70 percent, the standards are virtually identical to the
are designed appropriately to minimize average NOX adsorber performance over HD2007 program for on-highway
the contribution of cold-start emissions. the hot-start portion of the test cycle engines. The following three sections
Cold-start emissions can be minimized would only need to be 91 percent in (II.B.3, II.B.4, and II.B.5) describing the
by improving catalyst technology to order to realize a weighted average feasibility of the standards for engines
allow for control at lower exhaust performance of 90 percent. Similarly, above 750 hp, from 25 to 75 hp, and
temperatures (i.e., by lowering the were the cold-start test cycle below 25 hp, while following the same
catalyst light-off temperature) and by performance only 50 percent, the hot- pattern and objective, take additional
applying strategies to quickly raise the start performance would only need to be consideration of the fact that engines
exhaust temperature to a level above the 92 percent in order to realize a weighted and equipment in these size categories
catalyst light-off temperature. average performance of 90 percent.49 have no direct on-highway equivalent
There are a number of technologies We are confident, based on our and differ from highway engines in
available to the engine manufacturer to estimates of NOX adsorber performance substantial ways that cause us to reach
promote rapid warmup of the exhaust over the nonroad test cycle summarized differing conclusions regarding the
and emission control system. These in the RIA, that NOX adsorber appropriate standards and timing for
include retarding injection timing, performance in excess of 92 percent can those standards. Whether in scale, or
increasing EGR, and potentially late be expected in the time frame of the use, or operating conditions, the
cycle injection, all of which are requirements finalized today. characteristics of these engines and
technologies we expect manufacturers Complying with the PM standard equipment are such that we have taken
to apply as part of the normal operation given consideration of the cold start test particular consideration of them in
of the NOX adsorber catalyst system. procedure is not expected to be as setting the timing and level of the
These are the same technologies we challenging as compliance with the NOX standards. The remainder of this section
expect highway engine manufacturers to standard. The effectiveness for PM (II.B.3) discusses what makes the above
use in order to comply with the filtration is not significantly effected by 750 hp category unique and why the
highway cold start FTP provision which exhaust temperatures, as noted earlier. standards which we are adopting are
weights cold start emissions more Thus, PM emission levels are similar technologically feasible.
heavily with a 1/7 weighting. As a over the cold and hot start tests.
result, we expect the transfer of highway The standards that we are finalizing a. What Makes the Over 750 hp Category
technology to be well matched to today for nonroad engines with rated Different?
accomplish this control need for horsepower levels from 75 to 750 hp are The first and most obvious difference
nonroad engines as well. Using these based upon the same emission control for engines in this horsepower category
technologies we expect nonroad engine technologies, clean 15 ppm or lower is scale. No on-highway engines come
manufacturers to be able to comply with sulfur diesel fuel, and relative levels of close to the size of the largest engines
the new Tier 4 NOX, CO, and NMHC emission control effectiveness as the HD in this category which can produce in
emission standards including the cold 2007 emission standards. We have given excess of 3,000 horsepower, consist of
start provisions of the transient test consideration to the diversity of 16 or more cylinders and have 12 or
procedure. nonroad equipment for which these more turbochargers. The engines, and
One commenter has raised the technologies must be developed and the the equipment that they power, are
concern that if diesel engines are no timing of the Tier 3 emissions standards quite simply significantly larger than
cleaner than 3 g/bhp-hr NOX and if NOX in determining the appropriate timing any on-highway diesel engine. Many
adsorbers can be no more efficient than for the Tier 4 standards. Based upon the commenters argued that emission
90 percent, then any increase in NOX availability of the emission control technologies from on-highway vehicles
emissions above the 0.30 g/bhp-hr level technologies, the proven effectiveness of could not be simply scaled up for these
on a cold-start test will make the the technologies to control diesel larger engines and that if they were, the
emission standards infeasible. We emissions to these levels, the technology consequences of this resizing would
should clarify, when discussing the paths identified here to address include structural weakness and
emission reduction potential of the NOX constraints specific to nonroad reduced system robustness. As
adsorber catalyst generically in the equipment, and the additional lead time discussed below, our review of the
NPRM, we have sometimes simply afforded by the timing of the standards, information provided with these
stated that it is 90 percent or more we have concluded that the standards comments and our subsequent analysis
effective without plainly saying that this are technically feasible in the leadtime of the technical characteristics of some
refers to our expectation for average provided. emission control components has led us
performance considering both cold and to conclude that revised emission
3. Are the Standards for Engines Above
hot start emissions. More precisely then, standards (based on performance of
750 hp Feasible?
we would expect lower effectiveness different technologies that those whose
over the cold-start test procedure with The preceding discussion of the performance formed the basis for the
somewhat higher effectiveness realized standards for engines of 75 to 750 hp proposed rule) from those we proposed
over the hot-start test procedure. highlights the main thrust of our new for this horsepower category are
Because of the relative weightings of the Tier 4 program, a focus on realizing very appropriate and available.
two test cycles (i.e., 1/20 for the cold- low on-highway like emission levels for We have concluded that it is
start and 19/20 for the hot-start), the vast majority of nonroad diesel appropriate to distinguish between two
although the degradation of engines. The emission standards and the broad categories of engines over 750 hp
performance below 90 percent over the grouped by application: Mobile
49 The combined weighted average performance is
cold-start cycle can be substantially machines and generator sets. Mobile
calculated as 1/20 (cold-start) + 19/20 (hot-start).
greater than the performance above 90 Hence it can be seen that 1/20 (70%) + 19/20 (91%)
machines include the very largest
percent realized over the hot-start cycle, = 90% and likewise that 1/20 (50%) + 19/20 (92%) nonroad equipment used in mining
the standards remain feasible. For = 90%. trucks and large excavation equipment.
The environment and operating standard is feasible based on the cannot today conclude with certainty
conditions (especially for vibration) substantial reductions in sulfate PM due that such systems would be as robust in-
represent the harshest application into to the use of 15 ppm sulfur diesel fuel use as needed (see earlier discussion in
which nonroad engines are applied. and the potential to improve the section II.B.1.b). Considering the
Design considerations for technologies combustion process to reduce PM information available to the Agency
used to control emissions from engines emissions formed in the engine. today, we believe it appropriate to set
in these applications must first consider Specifically, we believe based on the the long term PM standard for these
robustness to the harsh environments evidence in the RIA that increasing fuel very large engines based on technologies
that will be experienced in use. In injection pressure, improving electronic which we can project with confidence
contrast, mobile nonroad generator sets controls and optimizing the combustion will give high levels of emission
operate in relatively good operating system geometry will allow engine reduction, durability, and robustness
environments. In addition, while mobile manufacturers to meet this level of PM when scaled to these very large engine
nonroad generator sets can, and are control in 2011. Some engine sizes.
moved between operating locations, manufacturers have in fact indicated to The 0.01 g/bhp-hr difference in the
they are always stationary during actual the Agency that this level of control PM emission standards between the
operation. Thus the levels of vibration represents an achievable goal by 2011. standard for generator sets and for other
and the general environment for engine One commenter argued however, that a mobile applications in this category
operation are significantly less more relaxed standard of 0.1 g/bhp-hr (0.01 g/bhp-hr lower for generator sets)
demanding for generator sets than for based on today’s on-highway diesel reflects our expectation that engine-out
mobile machines. Also the dynamic engine performance would be emissions from generator sets can be
range of operation is significantly appropriate. We disagree with this reduced below the level for mobile
narrower and less demanding for comment, believing that given the machines due to generator set operation
generator sets. Designed to operate at a substantial leadtime available and the at a single engine speed. Without the
set engine speed, synchronous to the potential for further improvements in need to provide full power and control
frequency cycle desired for electric combustion systems, that it is over the wider range of possible
generation (i.e., 1200 or 1800 RPM for appropriate to set a forward looking PM operating conditions that mobile
60 hz), diesel engines designed for standard of 0.075 g/bhp-hr. Conversely, machines must deliver, we believe that
generator set applications can be other commenters argued that future on- the air handling systems (especially the
optimized for operation in this narrow highway PM filter technology should be turbocharger match to the engine) can
range. applied to this class of engines as early be improved to provide a moderate
We have given specific consideration as 2011 (i.e., that a standard of 0.01 g/ reduction in engine-out emissions. This,
to the unique engineering challenges for bhp-hr PM is appropriate). While we coupled with the reduction afforded by
engines in this horsepower category in agree with the commenters that in the the PM filter technology, would allow
determining the appropriate emission long-term it will be appropriate to apply generator sets to meet a more stringent
standards set in today’s action. We have filter-based emission control 0.02 g/bhp-hr standard. Diesel engines
also taken into account the important technologies to these engines, we do not designed for use in generator sets
differences between generator set agree that such control is appropriate as meeting this standard will need to
applications and other mobile early as 2011. As the following section demonstrate compliance over the
applications in developing standards for explains, we believe that there are
appropriate test cycles, either the ISO
this horsepower category. C1 or D2 tests. As discussed in RIA
remaining technical challenges to be
chapter 4.3.6.2, PM emission rates are
b. Are the New Tier 4 Standards for addressed prior to the application of PM
nearly the same for steady-state testing
Over 750 hp Engines Technologically filters to these engines and that it is
or for alternative ramped modal cycle
Feasible? necessary to allow additional leadtime
(RMC) testing. These test cycles, like the
The emission standards described in for those challenges to be addressed.
engines, are designed to be
section II.A above describe a Beginning in 2015 all nonroad representative of the range of operation
comprehensive program for engines engines over 750 hp must meet stringent expected from a generator set.
over 750 hp that give consideration to PM filter technology-based emission As discussed previously, PM emission
both the physical size of these engines standards of 0.02 g/bhp-hr for engines control over the NTE region for PM filter
and the applications into which these used in generator set applications and equipped diesel engines is
engines are applied. Engines in this 0.03 g/bhp-hr for engines used in mobile predominantly a function of sulfate
power category must show compliance machine applications. We are formation at high exhaust temperatures.
with the C1 or D2 steady-state test predicating these emission standards Given that fuel consumption (and thus
cycles as appropriate as well as with the based on the application of a different sulfur) consumption rates on a brake
NTE provisions finalized today. As form of diesel particulate filter specific basis tend to be lower for
described in sections III.F and III.G, technology, a wire or fiber mesh depth engines above 750 hp, we can conclude
these engines will not be tested over the filter rather than a ceramic wall flow that the increase in PM emissions over
NRTC nor will they be subject to a cold- filter. Wire mesh filters are capable of the NTE region will likely be lower for
start test procedure. The feasibility reducing PM by 70 percent or more. We these engines than for engines meeting
discussion in this section describes have not based these standards upon the the 0.01 g/bhp-hr standard. Thus, we
expected performance of the engines more efficient (>90 percent) control can conclude based on the evidence in
over the required test cycles and the possible from ceramic wall flow style the RIA that compliance with the NTE
NTE. This section will briefly PM filters, because we believe that the provisions for PM is feasible for engines
summarize the feasibility analysis application of the wall flow filter over 750 hp.
contained in the RIA for these engines. technology on engines of this size has Although we are projecting that
PM Standards. Beginning in 2011 all not been adequately demonstrated at manufacturers will comply with this
nonroad diesel engines above 750 hp this time. While it would certainly be standard using a slightly less efficient
must meet a PM standard of 0.075 g/ possible to apply the ceramic-based PM filter technology, we remain
bhp-hr. We believe that this PM technology to these larger engines, we convinced that 15 ppm sulfur diesel fuel
will still be a necessity for this other mobile source emission category. For engines over 750 hp used in
technology to be applied. Regardless of Although nonroad generator sets are mobile machines (and for 750–1200 hp
the filter media chosen for the PM filter, mobile, in operation they remain at a generator sets from 2011 until 2015) we
the filter will still require catalyst-based fixed location where fuel is delivered to are setting a new NOX standard of 2.6
systems to ensure robust regeneration them periodically (i.e., a 1,200 hp g/bhp-hr beginning in 2011. We are
and adequate control of the SOF portion generator set does not and cannot pull predicating this level of emission
of PM. As these catalyst-based into the local truck stop for a fuel fill). control (an approximate 50 percent
technologies are adversely impacted by Therefore, the same infrastructure that reduction from Tier 2) on an improved
sulfur in diesel fuel as described in II.C currently provides urea delivery for combustion system and proven engine-
below, 15 ppm sulfur diesel fuel will be stationary power generation can also be based NOX control technologies.
required in order to ensure compliance utilized for nonroad generator set Specifically, we believe manufacturers
with the PM standards finalized here for applications.52 It would still remain for can apply either proven cooled EGR
engines over 750 hp. the manufacturer to develop a technology, or apply additional levels of
NOX Standards. As with the PM mechanism to ensure urea refill, but we engine boost, a limited form of Miller
standards, we are setting distinct NOX believe it is likely that solutions to this Cycle operation, and increased
standards for this category of engines problem can be addressed through intercooling capacity for the two-stage
reflecting particular concerns with the monitoring as for stationary source turbocharging systems that are used on
application of technologies to engines of emissions or other technology options these engines. The second approach for
this size and our desire to realize (e.g., a urea interlock that precludes in-cylinder emissions reductions is
significant NOX reductions as soon as engine operation without the presence similar in description at least to the
possible. There are two sets of NOX of urea). Caterpillar ACERT technology which we
standards that we are finalizing today, a Either of these technology approaches believe could be another path for
0.50 g/bhp-hr NOX standard for engines could be applied to realize an compliance with this standard. We are
used in generator set applications and a approximately 90 percent reduction projecting a modest increase in heat-
2.6 g/bhp-hr NOX standard for mobile from the current Tier 2 emission levels rejection to the engine coolant for these
machines. for these engines in order to comply in-cylinder emission control solutions
For engines used in generator set with an emission standard of 0.50 g/ and have accounted for those costs in
applications we are finalizing a 0.50 g/ bhp-hr. The 0.50 g/bhp-hr standard is our cost analysis. These approaches for
bhp-hr standard that goes into effect for different from our proposed level of 0.30 NOX reduction have been proven for on-
engines above 1,200 hp in 2011 and in g/bhp-hr reflecting the changes we have highway diesel engines since 2003
2015 for engines above 750 hp. We see made in this final action to the including compliance with NTE
two possible technology options for implementation schedule for this class provisions similar to those for nonroad
manufacturers to meet these standards. of engines and therefore our projections engines finalized here. We can conclude
First, compliance with this NOX for a technology path. At the time of the based on the on-highway experience
standard will be possible through the proposal, we projected that this class of that the NTE provisions can be met for
application of a dual bed NOX adsorber engine would follow an integrated two- engines in this horsepower category.
system (i.e., a system that allows step technology path. We are now One commenter suggested that a
regeneration to be controlled external to finalizing a program that anticipates the standard of 3.5 g/bhp-hr would be
the engine). This approach can work application of 90 percent effective NOX achievable in this time frame. As
well for generator set applications control to diesel engines for use in described here, we believe that further
where packaging constraints and generator sets without a reduction in emission reductions to 2.6 g/bhp-hr are
vibration issues are greatly reduced. engine-out NOX levels beyond Tier 2. possible in this time frame. Engine
Since this approach requires limited This reflects our desire to focus on manufacturers have indicated to the
engine redesign, it would be an getting the largest emission reduction Agency that they believe this level of in-
appealing approach for these large possible in the near term (beginning in cylinder emission control can be
engines sold in very low volumes. NOX 2011) from these engines. Where we realized for these very large diesel
adsorber systems for stationary power believe additional technology engines by 2011. We are deferring any
generation (systems that never move) development is needed, as is the case decision on setting aftertreatment based
are available today on a retrofit basis, for mobile machines over 750 hp, we are NOX standards for mobile machinery
and we believe with further finalizing a more gradual emission above 750 hp to allow additional time
development to address packaging and reduction technology pathway to evaluate the technical issues
durability concerns that similar systems anticipating further reductions in involved, as discussed in section II.A.4.
can be applied to mobile generator engine-out NOX emissions followed by
NMHC Standards. We are setting two
sets.50 a possible future action to reduce
different NMHC emission standards for
A second possible technology option emissions further as described in
engines in this category linked to the
for engines in this category is urea SCR. section II.A. RIA chapter 4.1.2.3.3
technologies used to control PM
The challenges for urea SCR in mobile describes NOX adsorber effectiveness to
emissions. We are requiring all engines
applications are well known, control NOX emissions including
over 750 hp to meet an NMHC standard
specifically a lack of urea infrastructure effectiveness over the NTE region. The
of 0.30 g/bhp-hr starting in 2011. As
to provide urea refill at diesel fueling discussion there is equally applicable to
explained earlier, in 2011 all engines
locations and a need to ensure that urea engines above and below 750 hp
over 750 hp must meet a PM emission
is added as necessary in use.51 These regarding NTE performance because the
standard of 0.075 g/bhp-hr. We are
hurdles can be addressed more easily key attribute of NTE performance
projecting that manufacturers will meet
for generator sets than for virtually any (exhaust temperature) is similar for
this standard through improvements in
engines across the horsepower range.
50 Emerachem EMxTM Datasheet—Describing the
in-cylinder emission control of PM (in
EMx IC (Internal Combustion) System Air Docket 52 Fleetguard StableGuardTM Urea Premix for use conjunction with use of 15 ppm sulfur
OAR–2003–0012–0948. with SCR NOX Reduction Systems, Air Docket A– diesel fuel). These PM control
51 See for example 68 FR 28375, May 23, 2003. 2001–28 Item IV–A–04. technologies, increased fuel injection
pressure, improved electronic controls transitional standard is optional for 50– standard and the 2013 standards. For an
and enhanced combustion system 75 hp engines, as the 2008 explanation and discussion of the
designs will concurrently lower NMHC implementation date is the same as the implementation dates, please refer to
emissions to the NMHC standard of 0.30 effective date of the Tier 3 standards. section II.A.
g/bhp-hr. Manufacturers may decide, at their
The second step in our NMHC i. 2008 PM Standards 54
option, not to undertake the 2008
standards is to a level of 0.14 g/bhp-hr, transitional PM standard, in which case We are today finalizing the interim
consistent with the standard for on- their implementation date for the 0.02 g/ PM control program as proposed for
highway diesels beginning in 2007 and bhp-hr PM standard begins in 2012. The engines in the power category from 25–
for other nonroad diesel engines from 75 remainder of this section discusses what 75 hp. The new PM standard for 2008
to 750 hp beginning in 2011. This makes the 25–75 hp category unique is 0.22 g/bhp-hr over the appropriate
change in NMHC standards is timed to and why the standards are steady-state test cycle (the NRTC and
coincide with the requirement that technologically feasible. NTE do not apply, for the reasons
engines over 750 hp meet stringent PM explained below).55 The standard is
emission standards that we believe will a. What Makes the 25–75 hp Category
premised on the use of 500 ppm sulfur
require the use of catalyst-based diesel Unique?
diesel fuel and the potential for
particulate filter systems. These systems As EPA explained in the proposal, improvements in engine-out emission
are expected to incorporate oxidation and as discussed in section II.A, one control where possible or the
catalyst functions to control the SOF cannot assume that highway application of a diesel oxidation catalyst
portion of diesel PM and to promote technologies are automatically (DOC). Some commenters raised
robust soot regeneration within the transferable to 25–75 hp nonroad concerns that this level of emission
filter. This same oxidation function is engines. In contrast with 75–750 hp control from diesel engines may not be
highly effective at controlling NMHC engines, which share similarities in possible in 2008 without fuel cleaner
emissions (the RIA documents displacement, aspiration, fuel systems, than 500 ppm or without changes in the
reductions of more than 80 percent) and and electronic controls with highway Tier 3 NMHC+NOX emission standards.
will result in a reduction in NMHC diesel engines, engines in the 25–75 hp Other commenters, including some
emissions below the 0.14 g/bhp-hr category have a number of technology engine manufacturers, supported this
standard for these engines. As the high differences from the larger engines. interim program. As explained in the
level of NMHC control afforded by the These include a higher percentage of following sections, we continue to
application of this technology is broadly indirect-injection fuel systems, and a believe that these standards are
realized across the wide range of diesel low fraction of turbocharged engines appropriate and feasible in the leadtime
engine operation, it will allow for (see generally RIA chapter 4.1). The provided.
compliance with the NTE provisions as distinction in the under 25 hp category Engines in the 25–50 hp category
well. Although in practice we expect is even more pronounced, with no must meet Tier 2 NMHC+NOX and PM
that NMHC emissions may be lower turbocharged engines, nearly one-fifth of standards today. We have examined the
than the 0.14 g/bhp-hr standard, we the engines have two cylinders or less, model year 2004 engine certification
have not finalized a more stringent and a significant majority of the engines data for engines in the 25–50 hp
standard for NMHC in order to maintain have indirect-injection fuel systems. category. These data indicate that over
consistency with the NMHC standard The distinction is particularly marked 35 percent of the engine families meet
we are finalizing for engines from 75 hp with respect to electronically controlled the 2008 0.22 g/bhp-hr PM standard and
to 750 hp, for which the NMHC fuel systems. These are commonly 5.6 g/bhp-hr NMHC+NOX standard
standard is in part based on feasibility available in the power categories greater (unchanged from Tier 2 in 2008) today
considerations for NOX adsorber catalyst than or equal to 75 hp, but, based on the (even without 500 ppm sulfur diesel
systems that use diesel fuel to available certification data as well as fuel). At the time of the proposal, we
regenerate themselves (with consequent our discussions with engine had analyzed model year 2002 data for
increased NMHC emissions during manufacturers, we believe there are very this power range, which at that time
regeneration events). We believe this is limited numbers, if any, in the 25–75 hp indicated approximately 10 percent of
appropriate considering our expectation category (and no electronic fuel systems the engine families complied with the
that NOX adsorber technology will be in the less than 25 hp category). The 2008 requirements. The most recent
found feasible for all nonroad engines research and development work being data for model year 2004 indicates
over 750 hp. performed today for the heavy-duty substantial progress has already been
highway market is targeted at engines made in just the past few year in
4. Are the New Tier 4 Standards for
which are 4-cylinders or more, direct- lowering emissions from these engines.
Engines 25–75 hp Feasible?
injection, electronically controlled, This is primarily due to the
As discussed in section II.B, our turbocharged, and with per-cylinder implementation of the Tier 2 standards
standards for 25–75 hp engines consist displacements greater than 0.5 liters. As in model year 2004. The model year
of a 2008 transitional standard and long- discussed in more detail below, as well
term 2013 standards. The transitional as in section II.B.5 (regarding the under 54 As discussed in section II.B., manufacturers can
standard is a 0.22 g/bhp-hr PM 25 hp category), these engine choose, at their option, to pull-ahead the 2013 PM
standard. The 2013 standards consist of distinctions are important from a standard for the 50–75 hp engines to 2012, in which
a 0.02 g/bhp-hr PM standard and a 3.5 technology perspective and warrant a case they do not need to comply with the
transitional 2008 PM standard.
g/bhp-hr NMHC+NOX standard.53 As different set of standards for the 25–75 55 However, a manufacturer can choose to comply
discussed in section II.A, the hp category (as well as for the under 25 over the TRU cycle including the associated NTE
hp category). provisions. Compliance with the NTE for engines
53 The 2013 NO +NMHC standard is a new selecting to certify on the TRU cycle is
X
standard only for engines in the 25–50 hp category. b. Are the New Tier 4 Standards for 25– straightforward because by the very nature of the
For engines in the 50–75 hp category, 3.5 g/bhp-hr 75 hp Engines Technologically Feasible? products, their operation is directly limited to a
NOX+NMHC is the existing Tier 3 emission small range of operating modes over which
standard which will now also apply across the new This section will discuss the technical compliance with the emission standard has already
regulated test cycles (e.g., NRTC). feasibility of both the interim 2008 PM been shown.
2001 certification data also showed the with the commenters that sulfur with the 0.22 g/bhp-hr PM standard
2008 standard were achievable using a reductions are important to control PM (and the 2008 NMHC+NOX standard),
mix of engine technologies (IDI and DI, and in the long term that a 15 ppm fuel and the availability of well known PM
turbocharged and naturally aspirated) sulfur level will be the best solution, we reduction technologies such as engine-
tested on a variety of certification test disagree with the assertion that the out improvements and diesel oxidation
cycles.56 A detailed discussion of these amount of sulfate PM formed from a catalysts, we project that the 0.22 g/bhp
data is contained in the RIA. DOC will be such that compliance with hr PM standards is technologically
At the time of the proposal, no the 0.22 g/bhp-hr standard will be feasible by model year 2008.
certification data was available for infeasible. While commenters shared
ii. 2013 Standards
engines in the 50–75 hp range, because data showing increased PM emissions
those engines were not subject to a Tier when DOCs are used, we have similarly For engines in the 25–50 range, we are
1 standard and were not subject to Tier found data (included in the RIA) that finalizing standards commencing in
2 standards until model year 2004. We shows an overall reduction in 2013 of 3.5 g/bhp-hr for NMHC+NOX
have now had an opportunity to analyze emissions. To understand this and 0.02 g/bhp-hr for PM. For the 50–
the model year 2004 certification data discrepancy, it is important to realize 75 hp engines, we are finalizing a 0.02
for engines in the 50–75 hp range. These that DOCs can be designed for operation g/bhp-hr PM standard which will be
data shows that more than 70 percent of on a range of fuel sulfur levels. The implemented in 2013, and for those
the engine families in this power range lower the fuel sulfur level, the more manufacturers who choose to pull-
are capable of meeting the 2008 PM effective the PM oxidation function, but ahead the standard one-year, 2012
standards today. However, most of these even at 500 ppm sulfur a properly (manufacturers who choose to pull-
engines do not yet meet the 3.5 g/bhp designed DOC will realize a net ahead the 2013 standard for engines in
hr Tier 3 NMHC+NOX standard, which reduction in PM emissions. DOCs have the 50–75 range do not need to comply
is required in 2008. We expect that to been successfully applied to diesel with the transitional 2008 PM standard).
comply with the Tier 3 standards, these engines for on-highway applications for A more complete discussion of the
engines will use technologies such as PM control on 500 ppm fuel since 1994 options available to manufacturers and
EGR and electronically controlled fuel through careful design of the DOC the nature of the transitional program
injection systems (and we included the trading-off PM reduction potential and can be found in section II.A. These
costs of these technologies in assessing sulfur oxidation potential. The RIA standards are measured using the NRTC
the costs of the Tier 3 standards). These contains additional analysis describing and steady-state tests. These engines
DOC function, and its expected also will be subject to the NTE starting
technologies have been shown to reduce
effectiveness when applied to nonroad with the 2013 model year.
NOX emissions by 50 percent without
diesel engines. PM Standard. For engines in the
increasing PM emissions. The horsepower category from 25–75 hp, we
certification data show that for the 70 Other commenters argued that the
application of DOC to diesel engines in are finalizing a PM standard of 0.02 g/
percent of the engine families which bhp-hr based on the application of
meet the 2008 Tier 4 PM standard (0.22 this category would lead to an even
greater emission reduction than catalyzed diesel particulate filters to
g/bhp-hr), a NOX reduction of less than engines in this category. We received a
50 percent is needed for most of these estimated in our proposal, thus allowing
the Agency to finalize a lower PM wide range of comments on our
engines to meet the 2008 Tier 4 proposal with some arguing that the
NMHC+NOX standard. A detailed standard. While we agree that some
engines will have lower emissions than emission standard could be met earlier
discussion of these data is contained in than 2013 and others arguing that while
required to meet the standard and that
the RIA. technically possible to apply PM filters
in the long term (once 15 ppm fuel is
In addition to using known engine-out to engines in this category, that it was
widely available) the PM emissions will
techniques, we also project that the not economically or otherwise practical
be further reduced, we do not believe
2008 standards can be achieved with the to do so.
that an emission level lower than 0.22
use of DOCs. DOCs are passive flow- The RIA discusses in detail catalyzed
g/bhp-hr will be generally feasible in
through emission control devices which diesel particulate filters, including
2008 due to the sulfur level of diesel
are typically coated with a precious explanations of how CDPFs reduce PM
fuel of 500 ppm sulfur and the potential
metal or a base-metal washcoat. DOCs emissions, and how to apply CDPFs to
for sulfate PM formation.
have been proven to be durable in use In summary then, there are two likely nonroad engines. We have concluded,
on both light-duty and heavy-duty means by which companies can comply as explained above, that CDPFs can be
diesel applications. In addition, DOCs with the interim 2008 PM standard. used to achieve the 0.01 g/bhp-hr PM
have already been used to control First, engine manufacturers can comply standard for 75–750 hp engines. As also
carbon monoxide on some nonroad with this standard using known engine- discussed in section II.B.2.a above, PM
applications.57 Some commenters raised out techniques (e.g., optimizing filters will require active back-up
concerns that DOCs could actually combustion chamber designs, fuel- regeneration systems for many nonroad
increase PM emissions when used on injection strategies). In fact, some applications above and below 75 hp
500 ppm sulfur diesel fuel due to the fraction of engines already would because low temperature operation is an
potential for oxidation of the sulfur in comply with the emission standard. In issue across all power categories. One
the fuel to sulfate PM. While we agree addition, some engine manufacturers commenter raised concerns regarding
may choose to use diesel oxidation the low exhaust temperatures possibly
56 The Tier 1 and Tier 2 standards for this power
catalysts to meet this standard. Our cost experienced by small nonroad engines
category must be demonstrated on one of a variety
of different engine test cycles. The appropriate test analysis makes the conservative and argued that such low temperatures
cycle is selected by the engine manufacturer based assumption (i.e., the higher cost make PM filter regeneration impossible
on the intended in-use application of the engine. assumption) that all manufacturers will absent the use of active regeneration
57 EPA Memorandum ‘‘Documentation of the
use DOC catalysts to comply with these technologies. We agree with the
Availability of Diesel Oxidation Catalysts on
Current Production Nonroad Diesel Equipment,’’ emission standards. commenter that active regeneration, as
William Charmley. Copy available in EPA Air Based on the existence of a number of described previously, may be necessary
Docket A–2001–28 Item II–B–15. engine families which already comply and have included the cost for such
systems in our cost estimates. See ratio increases. This leads to higher proposal, new information regarding
section II.B.1.a. A number of secondary heat-transfer losses and therefore lower model year 2004 engine certifications
technologies are likely required to efficiency and higher fuel consumption. has become available. That data show
enable proper regeneration, including In addition, frictional losses are a higher 18 percent of the engines in the 75–100
possibly electronic fuel systems such as percentage of total power for the smaller hp category already use electronically
common rail systems which are capable displacement engines which also results controlled fuel systems. In model year
of multiple post-injections which can be in higher fuel consumption. Because of 2001, no engines in this category used
used to raise exhaust gas temperatures the higher fuel consumption rate, we electronic fuel systems. We believe this
to aid in filter regeneration. expect a higher particulate sulfate level, strong trend toward the introduction of
Particulate filter technology, with the and therefore we have set a 0.02 g/bhp more advanced electronic fuel system
requisite trap regeneration technology, hr standard for engines in this power technology will continue in the future
can also be applied to engines in the 25 category. We did not receive any and, importantly for engines in the 25–
to 75 hp range. As explained earlier, the comments on our proposal arguing that 75 hp category, will extend to ever
fundamentals of how a filter is able to the technical basis for this higher PM smaller engine categories due to the user
reduce PM emissions are not a function level was inappropriate. benefits provided by the technology and
of engine power, so that CDPF’s are just The 0.02 g/bhp-hr standard applies to the falling cost for such systems.
as effective at capturing soot emissions all of the test cycles applicable to However, acknowledging the substantial
and oxidizing SOF on smaller engines engines in this power category (i.e., the time between now and 2012, and the
as on larger engines. The PM filter NRTC including cold-start, the ISO C1, potential for technologies to mature
regeneration systems described in D2 and G2 cycles and the alternative faster or slower than we are estimating
section II.B.2 are also applicable to TRU and RMC cycles, as appropriate). here, we have decided to conduct a
engines in this size range and are Our feasibility analysis summarized technology review of these standards as
likewise feasible. There are specific trap here and detailed in the RIA takes into described in section II.A above. This
regeneration technologies which we consideration these different test cycles. review will provide EPA with another
believe engine manufacturers in the 25– The control technologies work in a opportunity to confirm that the
75 hp category may prefer over others. similar manner and provide the same technical path laid out here is indeed
For example, some manufacturers may high level of emission control across progressing in a manner consistent with
choose to apply an electronically- these different operating regimes our expectations.
controlled secondary fuel injection including the NTE. The most significant NMHC+NOX Standard. As we
system (i.e., a system which injects fuel effect on emission performance is proposed, we are finalizing a 3.5 g/bhp
into the exhaust upstream of a PM related to sulfate PM formation at high hr NMHC+NOX standard for engines in
filter). Such a system has been load, high temperature operating the 25–50 hp range for 2013. We
commercially used successfully by at conditions. As the RIA details, this level received limited comments arguing that
least one nonroad engine manufacturer, of high sulfate formation rate is not high the NMHC+NOX standard should be less
and other systems have been tested by enough to preclude compliance with the stringent. Like the PM standard, some
technology companies.58 However, we PM emission standard with 15 ppm fuel commenters argued that the NOX
recognize that the application of these sulfur on the regulated test cycles nor is standard would be costly and
technologies will be challenging and it high enough to preclude compliance complicated, although not necessarily
will require additional time to develop. with the NTE provisions. At higher fuel infeasible to apply. Other commenters
We therefore disagree with commenters sulfur levels however, compliance with argued that the NOX standard for
who say that the standard could be met the PM emission standard would not be engines in this category like the new
sooner and have decided to finalize the feasible. standard for larger engines, should be
implementation schedule as proposed. The majority of negative comments on based upon the application of advanced
As we proposed, we are finalizing a our proposal to set a PM standard based NOX catalyst-based technologies. As
slightly higher PM standard (0.02 g/bhp on the control possible from PM filter described previously in section II.A, we
hr rather than 0.01) for engines in this technologies focused on the economic do not believe that the catalyst-based
power category. As discussed in the and technical challenges to apply these NOX technologies have matured to a
preamble to the proposed rule and in technologies and the major engine state were we can accurately define a
some detail in the RIA, with the use of technology enabler, electronic fuel feasible technical path for compliance
a CDPF, the PM emissions emitted by systems, to smaller diesel engines. Some for engines in this power category. We
the filter are primarily derived from the commenters acknowledged that the intend to revisit this question in our
fuel sulfur (68 FR 28389–28390, May 23, technologies were ‘‘technically feasible’’ technology review and if we find that a
2003). The smaller power category but not economically feasible or viable technical path can be described
engines tend to have higher fuel practical for engines in this power we will consider the appropriateness of
consumption per unit of work than category. While we acknowledge that a more stringent catalyst-based
larger engines. This occurs for a number the application of these technologies to standard.
of reasons. First, the lower power diesel engines in this horsepower The new standard aligns the
categories include a high fraction of IDI category will be challenging and have NMHC+NOX standard for engines in
engines which by their nature consume given consideration to this in setting the this power range with the Tier 3
approximately 15 percent more fuel timing for the new standard, we believe standard for engines in the 50–75 hp
than a DI engine. Second, as engine that the technical path for compliance is range which are implemented in 2008.
displacements get smaller, the engine’s clear and that the cost estimates we EPA’s recent Staff Technical paper
combustion chamber surface-to-volume have made for these engines accurately which reviewed the technological
represent this technical path. As feasibility of the Tier 3 standards
58 ‘‘The Optimized Deutz Service Diesel discussed in the RIA, at the time of the contains a detailed discussion of a
Particulate Filter System II,’’ H. Houben et. al., SAE proposal we projected no significant number of technologies which are
Technical Paper 942264, 1994 and ‘‘Development of
a Full-Flow Burner DPF System for Heavy Duty
penetration of electronic fuel systems capable of achieving a 3.5 g/bhp-hr
Diesel Engines,’’ P. Zelenka et. al., SAE Technical for engines in the 50–100 hp range prior standard. These include cooled EGR,
Paper 2002–01–2787, 2002. to the Tier 3 standards (2008). Since the uncooled EGR, as well as advanced in-
cylinder technologies relying on 5. Are the Standards for Engines Under engine families are at or below the PM
electronic fuel systems and 25 hp Feasible? standard today, while meeting the 2008
turbocharging.59 These technologies are As we explained at proposal and as NMHC+NOX standard. At the time of
capable of reducing NOX emissions by discussed in section II.A, the new PM the proposal, we examined the model
as much as 50 percent. Given the Tier standard for engines less than 25 hp is year 2002 certification, which indicated
2 NMHC+NOX standard of 5.6 g/bhp-hr, approximately 30 percent of the engine
0.30 g/bhp-hr beginning in 2008. The
a 50 percent reduction would allow a families were at or below the 2008
certification test cycle for this standard
Tier 2 engine to comply with the 3.5 g/ emission standards. This certification
is the ISO C1 cycle (or other appropriate
bhp-hr NMHC+NOX standard set in this data includes both IDI and DI engines,
steady-state test as defined by the
action. Therefore, we are projecting that as well as a range of certification test
engine’s intended use) from 2008
3.5 g/bhp-hr NOX+NMHC standard is cycles.61 Many of the engine families are
through 2012. Beginning in 2013, the
feasible with the addition of cooled EGR certified well below the Tier 4 standard
NRTC (with cold-start) and the NTE will
(the basis for our cost analysis) or other while meeting the 2008 NMHC+NOX
also apply to engines in this category.
equally effective in-cylinder NOX level. Specifically, for the model year
As discussed below, we are not setting
control technology as described in the 2002 data, 15 percent of the engine
a new standard more stringent than the
RIA and our recent Staff Technical families are cleaner than the new Tier
existing Tier 2 NMHC+NOX standard for 4 PM standard by more than 20 percent.
Paper. In addition, because this
this power category at this time. This The public certification data indicate
NMHC+NOX standard is concurrent
section describes what makes the less that these engines do not use
with the 0.02 g/bhp-hr PM standards
than 25 hp category different and why turbocharging, electronic fuel systems,
which we project will be achievable
the standards are technologically exhaust gas recirculation, or
with the use of particulate filters, engine
feasible. aftertreatment technologies. We saw
designers will have significant
additional flexibility in reducing NOX a. What Makes the Under 25 hp little change between the model year
because the PM filter will lessen the Category Unique? 2002 and 2004 data for this power
traditional concerns with the engine-out category primarily because both model
As we explained at proposal and in
NOX vs. PM trade-off. years are subject to the Tier 1 standards,
the RIA, nonroad engines less than 25 and many engine families are simply
Our recent highway 2004 standard
hp are the least sophisticated nonroad carried over from the previous model
review rulemaking (see 65 FR 59896,
diesel engines from a technological year. Tier 2 standards for these engines
October 2000) demonstrated that a
perspective. All of the engines currently will not be implemented until model
diesel engine with advanced electronic
sold in this power category lack year 2005. A detailed discussion of
fuel injection technology as well as NOX
electronic fuel systems and these data is contained in the RIA.
control technology such as cooled EGR
turbochargers. Nearly 20 percent of the In summary then, there are two likely
is capable of complying with an NTE
products have two-cylinders or less, and means by which companies can comply
standard set at 1.25 times the laboratory-
14 percent of the engines sold in this with the 2008 PM standard for engines
based FTP standard. We project that the
category are single-cylinder products, a under 25 hp. First, engine
same technology (electronic fuel
number of these have no batteries and manufacturers can comply with this
systems and cooled EGR) are also
are crank-start machines, much like standard using known engine-out
capable for engine in the 25–75 hp range
today’s simple walk behind lawnmower techniques (e.g., optimizing combustion
of complying with the NTE standard of
engines. In addition, given what we chamber designs, fuel-injection
4.4 g/bhp-hr NMHC+NOX (1.25 × 3.5) in
know today and taking into account the strategies). In fact, some fraction of
2013. This is based on the broad NOX
Tier 2 standards which have not yet engines already would comply with the
reduction capability of cooled EGR
been implemented, we are not emission standard. In addition, some
technology, which is capable of
projecting any significant penetration of engine manufacturers may choose to use
reducing NOX emissions across the
advanced engine technology, such as diesel oxidation catalysts to meet this
engine operating map (including the
electronically controlled fuel systems, standard. Our cost analysis makes the
NTE region) by at least 30 percent even
into this category in the next 5 to 10 conservative assumption (i.e., the higher
under high load conditions.60
years. cost assumption) that all manufacturers
Based on the information available to
EPA and presented here, and giving b. What Data Indicate That the will use DOCs to comply with these
appropriate consideration to the lead Standards Are Feasible? emission standards.
time necessary to apply the technology As discussed in section II.A, we are
We project the Tier 4 PM standard can finalizing supplemental test procedures
as well, we have concluded the 0.02 g/ be met by 2008 based on: The existence
bhp-hr PM standard for engines in the and standards (nonroad transient test
of a large number of engine families cycle and not-to-exceed requirements)
25–75 hp category and the 3.5 g/bhp-hr which meet the new standards today;
NMHC+NOX standards for the 25–50 hp for engines in the under 25 hp category
the use of engine-out reduction beginning in 2013. The supplemental
engines are achievable. techniques; and the use of diesel test procedures and standards will
59 See section 2.2 through 2.3 in ‘‘Nonroad Diesel
oxidation catalysts. apply not only to PM, but also to
Emission Standards—Staff Technical Paper,’’ EPA Engines in the less than 25 hp NMHC+NOX. The engine technologies
Publication EPA420–R–01–052, October 2001. Copy category must meet Tier 1 NMHC+NOX necessary to comply with the
available in EPA Air Docket A–2001–28. and PM standards today. We have supplemental test procedures and
60 See section 8 of ‘‘Control of Emissions of Air
examined the 2004 model year engine standards are the same as the
Pollution from 2004 and Later Model Year Heavy-
Duty Highway Engines and Vehicles: Response to
certification data for nonroad diesel technology necessary to comply with
Comments,’’ EPA document EPA420–R–00–011, engines less than 25 hp. These data the 2008 standard, and we have given
July 2000, and chapter 3 of ‘‘Regulatory Impact indicate that a number of engine
Analysis: Control of Emissions of Air Pollution families meet the new Tier 4 PM 61 The Tier 1 and Tier 2 standards for this power
from Highway Heavy-duty Engines,’’ EPA category must be demonstrated on one of a variety
document EPA420–R–00–010, July 2000. Copies of
standard (and the 2008 NMHC+NOX of different engine test cycles. The appropriate test
both documents available in EPA docket A–2001– standard, unchanged from Tier 2) today. cycle is selected by the engine manufacturer based
28. The data show that 31 percent of the on the intended in-use application(s) of the engine.
consideration to these test conditions in will be required for heavy-duty diesel C. Why Do We Need 15 ppm Sulfur
setting this standard. The range of trucks in the United States beginning in Diesel Fuel?
operating conditions covered by the 2007. The new Tier 4 emission standards for
various test cycles and the mechanism We anticipate that the diesel engine most categories of nonroad diesel
for emission control over those ranges of engines are predicated on the
manufacturers will be able to control
operation are substantially similar application of advanced diesel emission
crankcase emissions through the use of
allowing us to conclude that emission control technologies that are being
control will be substantially uniform closed crankcase filtration systems or by
routing unfiltered blow-by gases directly developed for on-highway diesel
across these test procedures. However, engines to meet the HD2007 emission
we are delaying the implementation of into the exhaust system upstream of the
emission control equipment. However, standards, namely catalyzed diesel
the supplemental test procedures and particulate filters and NOX adsorber
standards until 2013, as proposed, in the provisions have been written such
that if adequate control can be had catalysts. Sulfur in diesel fuel
order to implement these supplemental significantly impacts the durability,
requirements on the larger powered without ‘‘closing’’ the crankcase then
efficiency and cost of applying these
nonroad engines before the smallest the crankcase can remain ‘‘open.’’
technologies. Therefore, we required
power category. (There were no adverse Compliance would be ensured by
that on-highway diesel fuel produced
comments on this aspect of the adding the emissions from the crankcase for use in 2007 or newer on-highway
proposed rule.) This will also provide ventilation system to the emissions from diesel engines have sulfur content no
engine manufacturers with additional the engine control system downstream higher than 15 ppm. Based on the same
time to install any emission testing of any emission control equipment. We concerns outlined in the 2007
equipment upgrades they may need in have limited this provision for rulemaking, discussed in the proposal at
order to implement the new nonroad controlling emissions from open 68 FR 28395–28400, set out in the RIA,
transient test cycle. crankcases to turbocharged engines,
Based on the existence of a number of and briefly summarized below, we
which is the same as for heavy-duty today are finalizing a requirement that
engine families which already comply
highway diesel engines. diesel fuel for nonroad engines be
with the new Tier 4 PM standard (and
the 2008 NMHC+NOX standard), and Some commenters in essence argued reduced to no higher than 15 ppm
the availability of PM reduction that the Agency was obligated to show beginning in 2010. There was consensus
technologies such as improved that all potential compliance paths were among commenters that such standards
mechanical fuel systems, combustion feasible and absent that showing that were necessary if the proposed
chamber improvements, and in the Agency should reconsider this standards based on advanced diesel
particular diesel oxidation catalysts, we provision. Our feasibility analysis is emission control technologies were to
project that the 0.30 g/bhp-hr PM based on the use of closed crankcase be achievable.
standards is technologically feasible by Sulfur in diesel fuel acts to poison the
technologies designed to filter crankcase
model year 2008. oxidation function of platinum-based
gases sending the clean gas to the engine catalysts including DOCs and CDPFs
6. Meeting the Crankcase Emissions intake for combustion and returning the reducing the oxidation efficiency
Requirements oil filtered from the gases to the engine substantially, especially at lower
The most common way to eliminate crankcase. These systems are proven in temperatures. This poisoning limits the
crankcase emissions has been to vent use and the use of this technology to effectiveness of DOCs and CDPFs to
the blow-by gases into the engine air eliminate crankcase emissions is oxidize CO and HC emissions. Of even
intake system, so that the gases can be acceptable to demonstrate compliance. greater concern is the reduction in NO
recombusted. Prior to the HD2007 The other options, the option to vent oxidation efficiency of the CDPF due to
rulemaking, we have required that crankcase emissions into the exhaust or sulfur poisoning. NO oxidation to NO2
crankcase emissions be controlled only to continue to vent crankcase emissions is a fundamental mechanism for PM
on naturally aspirated diesel engines. to the atmosphere provided the total filter regeneration necessary to ensure
We had made an exception for emissions including tailpipe and robust operation of the CDPF (i.e., to
turbocharged diesel engines (both crankcase emissions do not exceed the prevent filter plugging). Sulfur
highway and nonroad) because of standards are provided as alternate poisoning from sulfur in diesel fuel at
concerns in the past about fouling that solutions that are clearly effective to levels higher than 15 ppm has been
could occur by routing the diesel control emissions (i.e., if the emissions shown to increase the likelihood of PM
particulates (including engine oil) into are measured and are below the filter failure due to a depressed NO to
the turbocharger and aftercooler. standard they are adequately NO2 oxidation efficiency of the CDPF.
However, this is an environmentally controlled). The commenter suggests The RIA documents substantial field
significant exception since most however, that they may not be able to experience in Europe regarding this
nonroad equipment over 75 hp use control the emissions to the required phenomenon.
turbocharged engines, and a single Sulfur in diesel fuel can itself be
level using these alternate approaches.
engine can emit over 100 pounds of oxidized to form sulfate PM emitted into
In this case, a manufacturer would need
NOX, NMHC, and PM from the the environment. CDPFs in particular
to use the primary approach identified are designed for robust regeneration and
crankcase over its lifetime.
Given the available means to control by EPA, closing the crankcase and are highly effective at oxidizing sulfur to
crankcase emissions, we eliminated this routing the filtered gases to the engine’s sulfate PM (approaching 100 percent
exception for highway engines in 2007 intake (this is the approach we used in conversion under some circumstances).
and similarly in today’s action are the cost analysis summarized in section The sulfate PM emissions from a CDPF
eliminating the exception for nonroad VI). We have allowed the alternative when operated on 350 ppm fuel can be
diesel engines as well. A number of approaches at the recommendation of so high as to actually increase the PM
commenters supported this provision some in industry, because if they prove emission rate above the baseline level
noting that the necessary technologies to be effective we accept that resulting for an engine without a PM filter. In
are already in application in Europe and total emissions will be acceptably low. spite of more than ten years of research,
no effective means has been found to of higher fuel sulfur levels on fuel through 89.212). With today’s action we
provide the NO to NO2 oxidation economy due to more frequent are retaining the basic structure of the
efficiency needed to ensure robust filter desulfation events can be found in the existing nonroad diesel ABT program,
regeneration without similarly RIA. though we are adopting a number of
increasing efficiency to oxidize sulfur to For all of the reasons documented in changes to accommodate
sulfate PM. Conversely, technologies the RIA and summarized here, we implementation of the newly adopted
developed to suppress sulfate PM remain convinced that a cap of 15 ppm Tier 4 emission standards. The ABT
formation (e.g., the addition of fuel sulfur is necessary for both on- program is intended to enhance the
vanadium to DOCs designed to operate highway and nonroad diesel engines in ability of engine manufacturers to meet
on 500 ppm sulfur fuel) also suppress order to apply the advanced emission the stringent standards adopted today.
NO to NO2 formation. Therefore, it is control technologies necessary to meet The program is also structured to limit
not possible to apply the robust CDPF the emission standards we are finalizing
technology to achieve the PM standards production of very high-emitting
today.
without first having lower diesel fuel engines and to avoid unnecessary delay
sulfur levels. The RIA documents III. Requirements for Engine and of the transition to the new exhaust
substantial test data showing the impact Equipment Manufacturers emission control technologies.
of sulfur in diesel fuel on total PM This section describes the regulatory We view the ABT program as an
emissions due to an increase in sulfate changes being made for the engine and important element in setting emission
PM emissions. equipment compliance program. A standards that are appropriate under
Sulfur from diesel fuel likewise number of specific items are discussed CAA section 213(a) with regard to
poisons the storage function of the NOX in this section, including test technological feasibility, lead time, and
adsorber catalyst. Sulfur in the exhaust procedures, certification fuels, and cost, given the wide breadth and variety
in the form of SOX is stored on the credit program provisions. These of engines covered by the standards. As
catalyst in the same way as the NOX provisions are important in that they we noted at proposal, if there are engine
emissions are stored. Unfortunately, due help us ensure the engines and families that will be particularly costly
to the chemical properties of the equipment will meet the new
materials, the sulfur is stored or have a particularly hard time coming
requirements throughout their entire into compliance with the standard, this
preferentially to the NOX and will useful life, thus achieving the expected
actually displace the stored NOX flexibility allows the manufacturer to
emission and public health benefits.
emissions. The stored sulfur is not adjust the compliance schedule
One of the most obvious changes from
easily removed from the catalyst. A the Tier 2/Tier 3 program is that the accordingly, without special delays or
sulfur removal step, called a regulations for Tier 4 engines have been exceptions having to be written into the
desulfation, can be accomplished by written in a plain language format. They rule. Emission-credit programs also
raising exhaust temperatures to a very are structured to contain the provisions create an incentive for the early
high level while simultaneously that are specific to nonroad compression introduction of new technology (for
increasing the reductant content of the ignition (CI) engines in a new part 1039, example, to generate credits in early
exhaust above the stoichiometric level and to apply the general provisions of years to create compliance flexibility for
(i.e., more fuel than oxygen in the existing parts 1065 and 1068. The plain later engines), which allows certain
exhaust). This process can be effective language regulations, however, are not engine families to act as trailblazers for
to remove sulfur from the catalyst but at intended to significantly change the new technology. This can help provide
the expense of damaging the catalyst compliance program, except as valuable information to manufacturers
slightly. Over the lifetime of a diesel specifically noted in today’s notice and on the technology before they apply the
engine the cumulative damage from supporting documents. These plain technology throughout their product
repeated desulfation events, as would be language regulations will only apply for line. This early introduction of clean
required if operation on higher than 15 Tier 4 engines. The changes from the technology improves the feasibility of
ppm sulfur fuels were attempted, would existing nonroad program are described achieving the standards and can provide
lead to excessive damage and loss in below along with other notable aspects
NOX control. The RIA contains an valuable information for use in other
of the compliance program. regulatory programs that may benefit
extensive description of this phenomena As described below, we received
including the tradeoff between higher from similar technologies. Early
comments from a broad range of introduction of such engines also
fuel sulfur levels and more frequent commenters for some of these issues.
desulfation events. secures earlier emission benefits.
For other issues, we received only
The damage that sulfur inflicts on In an effort to make information on
manufacturer comments or no
both the CDPF and NOX adsorber the ABT program more available to the
comments at all. See Chapter 9 of the
technologies not only reduces their public, we intend to issue an annual
Summary and Analysis of Comments for
effectiveness but also impacts the fuel report summarizing use of the ABT
more information about the comments
economy of their application. Reduced program by engine manufacturers. The
received and our responses to them.
soot regeneration potential due to sulfur information contained in the reports
poisoning would lead to the need for A. Averaging, Banking, and Trading will be based on the information
more frequent active CDPF regeneration.
1. Why Are We Adopting an ABT submitted to us by engine
As each active soot regeneration event
consumes fuel, more frequent Program for Tier 4 Nonroad Diesel manufacturers in their annual reports,
regeneration events with higher fuel Engines? and summarized in a way that protects
sulfur levels leads to an increase in fuel EPA has included averaging, banking, the confidentiality of individual engine
consumption. Similarly, higher fuel and trading (ABT) programs in almost manufacturers. We believe this
sulfur levels would necessitate more all of its recent mobile source emission information will also be helpful to
frequent NOX adsorber desulfation control programs. Our existing engine manufacturers by giving them a
events and thus higher fuel regulations for nonroad diesel engines better indication of the availability of
consumption. An estimate of the impact include an ABT program (40 CFR 89.201 credits.
2. What Are the Provisions of the ABT The existing ABT program for and appropriate. Thus, as proposed, to
Program? nonroad diesel engines covers ensure that the ABT provisions are not
The following section describes the NMHC+NOX emissions as well as PM used to continue unnecessarily to
ABT provisions being adopted with emissions. With today’s action and as produce old-technology high-emitting
today’s action. Areas in which we have proposed, we are making the ABT engines under the new program, the FEL
made changes to the proposed ABT program available for the Tier 4 NOX caps are not, in general, set at the
program are highlighted. A complete standards (and NMHC+NOX standards, previous standards. Exceptions have
summary of comments received on the where applicable) and the Tier 4 PM been made for the NMHC+NOX standard
proposed ABT program and our standards. As proposed, ABT will not be for engines between 25 and 50
response to those comments are available for the Tier 4 NMHC standards horsepower effective in model year 2013
contained in the Summary and Analysis for engines above 75 horsepower. and the NOX standards applicable to
Engine manufacturers commented engines above 750 horsepower in 2011,
of Comments document for this rule.
The ABT program has three main that ABT will most likely be necessary where we are using the estimated NOX-
for the Tier 4 CO standards, given the only equivalent for the previously
components. Averaging means the
reductions in PM and NOX emissions. In applicable NMHC+NOX standard for the
exchange of emission credits between
the Tier 4 proposal, we proposed minor FEL cap since the gap between the
engine families within a given engine
changes in CO standards for some previous and newly adopted standards
manufacturer’s product line. Engine
engines solely for the purpose of is approximately 40 percent (rather than
manufacturers divide their product line
helping to consolidate power categories 90 percent for engines between 75 and
into ‘‘engine families’’ that are
and improving administrative 750 horsepower), and because the
comprised of engines expected to have
efficiency. However, as noted earlier in technology basis for these standards can
similar emission characteristics
section II.A.6, we have withdrawn this be a form of engine-out control, like the
throughout their useful life. Averaging
aspect of the proposal. We do note, previous tier standards. This approach
allows a manufacturer to certify one or however, that we are applying new
more engine families at levels above the of setting FEL caps at lower levels than
certification tests to all pollutants the previously applicable standards is
applicable emission standard, but below covered by the rule, the result being that
a set upper limit. However, the consistent with the level of the FEL
Tier 4 engines will have to certify to CO limits set in the 2007 on-highway
increased emissions must be offset by standards measured by the transient test
one or more engine families within that heavy-duty diesel engine program.
(including a cold start component), and
manufacturer’s product line that are the NTE. However, as shown in RIA STAPPA/ALAPCO supported the
certified below the same emission chapter 4.1.1.2 (see e.g., note F), we proposed FEL caps. The Engine
standard, such that the average believe that application of Tier 4 Manufacturers Association (EMA)
emissions from all the manufacturer’s technologies will lead to a reduction in commented that EPA should eliminate
engine families, weighted by engine CO emissions over the Tier 3 baseline. the FEL caps altogether. They believe
power, regulatory useful life, and We thus believe the CO standards will FEL caps are unnecessary because the
production volume, are at or below the be readily achievable under the zero-sum requirement of ABT will
level of the emission standard. (The transient test and NTE. Moreover, we ensure that there are no adverse
inclusion of engine power, useful life, believe that there will not be any emission impacts. Short of eliminating
and production volume in the averaging associated costs: The CO standards can the FEL caps, they commented that EPA
calculations is designed to reflect be met without any further should set FEL caps at the level of the
differences in the in-use emissions from technological improvements (i.e., previous standards, not the more
the engines.) Averaging results are improvements other than those already stringent levels proposed. With today’s
calculated for each specific model year. necessary to meet the Tier 4 standards) action, EPA is adopting the FEL caps as
The mechanism by which this is and these tests will already be used for proposed, with some exceptions for
accomplished is certification of the certification. Since CO standards engines above 750 horsepower (where
engine family to a ‘‘family emission measured by the new certification tests we are adopting different standards than
limit’’ (FEL) set by the manufacturer, are achievable without cost, there is no originally proposed) and for phase-in
which may be above or below the basis for allowing ABT because no engines between 75 and 750 horsepower
standard. An FEL that is established additional lead time is needed. (where we have adopted an option for
above the standard may not exceed an As noted earlier, the existing ABT manufacturers to certify to alternative
upper limit specified in the ABT program for nonroad diesel engines NOX standards during the phase-in
regulations. Once an engine family is includes FEL caps—limits on how high period). We continue to believe that it
certified to an FEL, that FEL becomes the emissions from credit-using engine is important to ensure that technology
the enforceable emissions limit for all families can be. No engine family may turns over in a timely manner and that
the engines in that family for purposes be certified above these FEL caps. These manufacturers do not continue
of compliance testing. Averaging is limits provide manufacturers with producing large numbers of high-
allowed only between engine families in compliance flexibility while protecting emitting, old technology engines once
the same averaging set, as defined in the against the introduction of the Tier 4 standards become fully
regulations. unnecessarily high-emitting engines. In effective. (As noted below, however, we
Banking means the retention of the past, we have generally set the FEL are adopting provisions that allow
emission credits by the engine caps at the emission levels allowed by manufacturers to produce a limited
manufacturer for use in future model the previous standard, unless there was number of 75 to 750 horsepower engines
year averaging or trading. Trading some specific reason to do otherwise. for a limited period that are certified
means the exchange of emission credits With today’s action, we are taking a with FELs as high as the previous tier
between nonroad diesel engine different approach because the level of of standards.) For the Tier 4 standards,
manufacturers which can then be used the standards being adopted for most where the standards are being reduced
for averaging purposes, banked for engines are significantly lower than the by an order of magnitude, we believe
future use, or traded to another engine current level of the standards. The this goal to be particularly important,
manufacturer. transfer to new technology is feasible and in keeping with the technology-
forcing provisions of section 213(a). It previously applicable Tier 2 PM 2011 NOX and PM standards are
simply would not be appropriate to standards for the FEL caps (which do approximately 50 percent lower than
have long-term FEL caps that allowed vary within the 25 to 75 horsepower the previous standard (rather than in
engines to indefinitely have emissions category) because the gap between the excess of 90 percent for engines between
as high as ten times the level of the previous standards and the newly 75 and 750 horsepower), and for most
standard. adopted standards is approximately 50 engines are based on performance of the
For engines between 75 and 750 percent (rather than in excess of 90 same type of technology (engine-out),
horsepower certified using the phase-in/ percent for engines between 75 and 750 we are adopting the previously
phase-out approach, there will be two horsepower), and the technology basis applicable Tier 2 standards for the FEL
separate sets of engines with different for the 2008 PM standards can be a form caps.
FEL caps. For engines certified to the of engine-out control, like the previous Beginning in model year 2015, the
existing (Tier 3) NMHC+NOX standards tier standard. For the Tier 4 PM 0.50 g/bhp-hr NOX standard will apply
during the NOX phase-in (referred to standard effective in model year 2013
to all engines above 750 horsepower
generally as ‘‘phase-out’’ engines), the for engines between 25 and 75
used in generator sets. Beginning in
FEL cap for these pollutants will (almost horsepower, we are adopting a PM FEL
model year 2015, the PM standard drops
necessarily) be the existing FEL caps cap of 0.04 g/bhp-hr, and for the Tier 4
to 0.02 g/bhp-hr for engines greater than
adopted in the October 1998 Tier 3 rule. PM standard effective in model years
750 horsepower used in generator sets
For engines certified to the newly 2011 and 2012 for engines between 75
and 0.03 g/bhp-hr for engines greater
adopted Tier 4 NOX standard during the and 750 horsepower, we are adopting a
than 750 horsepower used in other
phase-in (referred to generally as PM FEL cap of 0.03 g/bhp-hr. As with
machines. Consistent with the Tier 4
‘‘phase-in’’ engines), we have revised the Tier 4 NOX standards for these
FEL caps for lower horsepower
the proposed FEL cap to be 0.60 g/bhp engines, given the fact that these Tier 4
aftertreatment-based PM standards for categories where the new standards are
hr, consistent with the proposed long-
engines between 25 and 750 horsepower significantly lower than the previously
term Tier 4 NOX FEL cap. As described
are over 90 per cent more stringent than applicable standards and reflect
in section II.A.2.c above, we have used
the previous standards, we do not performance of aftertreatment
the creation of alternative NOX
believe the previous standards are technology, we are adopting a NOX FEL
standards for engines between 75 and
appropriate as FEL caps once the Tier 4 cap of 0.80 g/bhp-hr for engines used in
750 horsepower to restate the phase-in/
standards take effect. We believe that generator sets and PM FEL caps of 0.04
phase-out concept as a path truly
the newly adopted PM FEL caps will g/bhp-hr for engines used in generator
focused on achieving high-efficiency
ensure that manufacturers adopt PM sets and 0.05 g/bhp-hr for engines used
NOX aftertreatment during the phase-in
aftertreatment technology across all of in other machines (i.e., mobile
years. Setting the NOX FEL cap at 0.60
their engine designs (except for a machines). We believe that the FEL caps
g/bhp-hr for phase-in engines will
limited number of engines), yet will still for engines above 750 horsepower will
ensure this happens if a manufacturer
provide substantial flexibility in ensure that manufacturers adopt PM
chooses to certify to the phase-in
meeting the standards. aftertreament technology across all of
provisions. In contrast, the higher FEL
The final Tier 4 standards for engines their engine designs and NOX
caps which we proposed (see 68 FR
above 750 horsepower have been aftertreatment for generator sets once
28467–28468) would not have achieved
revised from the proposal. We similarly the 2015 standards are adopted, while
this objective.
Beginning in model year 2014 when revised a number of the proposed ABT allowing for some meaningful use of
the Tier 4 NOX standards for engines provisions for engines above 750 averaging beginning in 2015.
between 75 and 750 horsepower take horsepower. Beginning in 2011, all Table III.A–1 contains the FEL caps
full effect, we are adopting a NOX FEL engines above 750 horsepower will be and the effective model year for the FEL
cap of 0.60 g/bhp-hr for all engines. We required to meet a NOX standard of 2.6 caps (along with the associated
reiterate that given the fact that the Tier g/bhp-hr, except for those above 1200 standards adopted for Tier 4). It should
4 NOX standard is approximately a 90 horsepower used in generator sets be noted that for Tier 4, where we are
percent reduction from the existing which will be required to meet a NOX adopting a new transient test for most
standards for engines between 75 and standard of 0.50 g/bhp-hr. The NOX FEL engines, as well as retaining the current
750 horsepower, we do not believe the cap for the 2011 standards will be 4.6 steady-state test, the FEL established by
previous standard is appropriate as the g/bhp-hr, which is an estimate of the the engine manufacturer will be used as
FEL cap for engines having to comply NOX emissions level that is expected the enforceable limit for the purpose of
with the Tier 4 NOX standard of 0.30 g/ under the combined NMHC+NOX compliance testing under both test
bhp-hr. We believe that the NOX FEL standards that apply with the previously cycles. In addition, under the NTE
caps will ensure that manufacturers applicable tier for engines above 750 requirements, the FEL times the
adopt NOX aftertreatment technology horsepower. Beginning in 2011, all appropriate multiplier will be used as
across all of their engine designs. engines above 750 horsepower will have the enforceable limit for the purpose of
For the interim PM standards for to meet a PM standard of 0.075 g/bhp such compliance testing. This is
engines between 25 and 75 horsepower hr. The PM FEL cap for the 2011 PM consistent with how FELs are used for
effective in model year 2008 and for the standard will be the previously- compliance purposes in the 2007 on-
Tier 4 PM standards for engines below applicable Tier 2 standard of 0.15 g/ highway heavy-duty diesel engine
25 horsepower, we are adopting the bhp-hr. As noted above, because the program.
TABLE III.A–1.—FEL CAPS FOR THE TIER 4 STANDARDS IN THE ABT PROGRAM (G/BHP-HR)
PM
NOX stand- PM
Power category Effective model year ard NOX FEL cap standard FEL
cap
hp <25 (kW <19) ....................................................... 2008+ .............................. a 5.6 7.8 a for <11hp ................ c 0.30 0.60
7.1 a for >11hp
25 ≤ hp < 50 (19 ≤ kW <37) ..................................... 2008–2012 ...................... a 5.6 7.1 a ................................. 0.22 0.45
25 ≤ hp < 50 (19 ≤ kW <37) ..................................... 2013+ .............................. b3.5 5.6 b ................................. 0.02 f 0.04
50 ≤ hp < 75 (37 ≤ kW <56) ..................................... 2008–2012 d .................... a 3.5 5.6 a ................................. 0.22 0.30
50 ≤ hp < 75 (37 ≤ kW <56) ..................................... 2013+ e ............................ a 3.5 5.6 a ................................. 0.02 f 0.04
75 ≤ hp < 175 (56 ≤ kW <130) ................................. 2012+ .............................. 0.30 0.60 f g h ............................ 0.01 f 0.03
175 ≤ hp ≤ 750 (130 ≤ kW ≤ 560) ............................ 2011+ .............................. 0.30 0.60 f g h ............................ 0.01 f 0.03
hp > 750 (kW >560) ................................................. 2011–2014 ...................... 2.6 4.6 ................................... 0.075 0.15
i 0.50 4.6
Generator Sets hp > 750 (kW >560) ........................ 2015+ .............................. 0.50 0.80 f ................................ 0.02 f 0.04
Other Machines hp > 750 (kW >560) ....................... 2015+ .............................. j 2.6 4.6 j .................................. 0.03 f 0.05
Notes:
a These are the previous tier NMHC+NO standards and FEL caps. These levels are not being revised with today’s rule and are printed here
X
solely for readers’ convenience.
b These are a combined NMHC+NO standard and FEL cap.
X
c A manufacturer may delay implementation until 2010 and then comply with a PM standard of 0.45 g/bhp-hr for air-cooled, hand-startable, di-
rect injection engines under 11 horsepower.
d These FEL caps do not apply if the manufacturer opts out of the 2008 standards. In such cases, the existing Tier 3 standards and FEL caps
continue to apply.
e The FEL caps apply in model year 2012 if the manufacturer opts out of the 2008 standards.
f As described in this section, a small number of engines are allowed to exceed these FEL caps.
g For engines certified as phase-out engines, the NMHC+NO FEL caps for the Tier 3 standards apply.
X
h For engines certified to the alternative NO standards during the phase-in, the NO FEL caps shown in tables III.A–3 and III.A–4 apply.
X X
i The 0.50 g/bhp-hr NO standard applies only to engines above 1200 horsepower used in generator sets.
X
j The 2011 NO standard and FEL cap continue to apply unless and until revised by EPA in a future action.
X
As noted above, we are allowing a tell if the proposed amounts provided on these engines because we expect
limited number of engines to have a enough flexibility. these engines would be carried over
higher FEL than the caps noted in Table In an effort to provide flexibility to directly from the previous tier without
III.A–1 in certain instances. The FEL engine manufacturers while preserving any modification. (NTE testing would
cap for such engines would be set based the effective number of engines allowed apply to engines above 750 horsepower
on the level of the standards that to certify at levels up to the higher FEL because the previously applicable set of
applied in the year prior to the new caps, we are revising the proposed standards required NTE testing.)
standards and will allow manufacturers provisions with today’s action. The Similarly, for engines between 75 and
to produce a limited number of engines revised provisions are intended to allow 750 horsepower, manufacturers would
certified to these earlier standards in the manufacturers to produce the same not be required to have closed crankcase
Tier 4 timeframe. The allowance to number of engines certified to the controls on these engines because we
certify up to these higher FEL caps will higher FEL caps as would have been also expect that these engines would be
apply to Tier 4 engines between 25 and allowed under the proposal, but provide carried over directly from the previous
750 horsepower beginning as early as added flexibility in how they distribute tier without any modification. (Engines
the 2011 model year, and will apply to the allowances over the first four years between 25 and 75 horsepower, and
engines above 750 horsepower starting of the transition to the new standards. engines above 750 horsepower, would
with the 2015 model year. The This additional lead time appears be required to have closed crankcase
provisions are intended to provide some appropriate, given the potential that a controls because the previously
limited flexibility for engine limited set of nonroad engines may face applicable set of standards require
manufacturers as they make the especially challenging compliance closed crankcase controls.)
transition to the aftertreatment-based difficulties. Under the provisions For the purpose of calculating the
Tier 4 standards while ensuring that the adopted today and subject to the number of credits such engines would
vast majority of engines are converted to limitations explained below, a use, the manufacturer would include an
the advanced low-emission technologies manufacturer would be allowed to adjustment to the FEL to be used in the
expected under the Tier 4 program. certify up to 40 percent of its engines credit calculation equation. The
Under the proposal, manufacturers above the FEL caps shown in Table adjustment would be included by
would have been allowed to certify at III.A–1 over the first four years the multiplying the steady-state FEL by a
levels up to these FEL caps for ten aftertreatment-based Tier 4 standards Temporary Compliance Adjustment
percent of its engines in each of the first take effect (calculated as a cumulative Factor (TCAF) of 1.5 for PM and 1.1 for
four years after the Tier 4 standards took total of the percent of engines exceeding NOX. (The NOX TCAF would not apply
effect and then five percent for these FEL caps in each year over the to engines that are not subject to the
subsequent years. The California Air four years), with a maximum of 20 transient testing requirements for NOX
Resources Board supported the percent allowed in any given year as discussed in section III.F.) We are
proposed allowance. The Engine (provided the FELs for these engines do adopting TCAFs in part to assure in-use
Manufacturers Association commented not exceed levels specified below). control of emission from these engines
that the percentages of engines allowed During this four year period, in the absence of transient and NTE
to the higher FEL caps may not be manufacturers would not be required to testing, and also to assure that any
sufficient, noting that it is too early to perform transient testing or NTE testing credits these engines use reflect the
level of reductions expected in use. The engines during the phase-in years. We For engines above 750 horsepower,
level of the TCAFs are based on data originally proposed that the allowance the allowance to certify a limited
from pre-control, Tier 1, and Tier 2 to use a higher FEL cap would apply to number of engines at levels up to the
engines which show that the emissions PM from either phase-in or phase-out higher FEL caps would apply beginning
from such engines tested over transient engines during the phase-in years. On in model year 2015. (As noted, this is
test cycles which are more reflection, this is inconsistent with our because the FEL caps being adopted for
representative of real in-use operation policy that phase-in engines truly have the 2011 standards for engines above
are higher than emissions from those low emissions reflecting use of 750 horsepower are the previous tier PM
engines tested over the steady-state aftertreatment (see also the discussion standard and the NOX-only equivalent
certification test cycle. This is a sales above where we explain that, for the of the previous tier standard.) For NOX,
weighted version of the Transient same reason, we are adopting a NOX the allowance to certify a limited
Adjustment Factor used in the FEL cap of 0.60 g/bhp-hr for phase-in number of engines above the FEL cap
NONROAD model. For compliance engines). We consequently are revising beginning in model year 2015 will apply
purposes, a manufacturer would be held the proposed allowance so that it is only to engines used in generator sets.
accountable to the unadjusted steady- available for PM emissions only from Engines used in other machines are still
state FEL established for the engine phase-out engines. As proposed, the subject to the model year 2011 NOX
family. allowance to use a higher FEL cap for standard and FEL caps. For PM, the
As proposed, after the fourth year the NOX will apply starting in 2014 when allowance to certify a limited number of
Tier 4 standards apply, the allowance to the phase-in period is complete. engines above the FEL caps beginning in
certify engines using the higher FEL For the power category between 25 model year 2015 will apply to all
caps shown in Table III.A–2 will still be and 75 horsepower, this allowance to engines above 750 horsepower.
available but for no more than five certify engines at levels up to the higher Table III.A–2 presents the model
percent of the engines a manufacturer FEL caps will apply beginning with the years, percent of engines, and higher
produces in each power category in a Tier 4 standards taking effect in the FEL caps that will apply under these
given year. When the 5 percent 2013 model year and will apply to PM allowances. As noted above, engines
allowance takes effect, these engines only. For manufacturers choosing to opt certified under these higher FEL caps
will be considered Tier 4 engines and out of the 2008 model year Tier 4 during the first four years would not be
all other requirements for Tier 4 engines standards for engines between 50 and 75 required to perform transient testing or
will also apply, including the Tier 4 horsepower and instead comply with NTE testing and engines between 75 and
NMHC standard, transient testing, NTE the Tier 4 standards beginning in 2012, 750 horsepower would not be required
testing, and closed crankcase controls. the 40% allowance would apply to to have closed crankcase controls on
TCAFs thus do not apply when model years 2012 through 2015, and the these engines. However, as also noted
calculating the number of credits such 5% allowance would apply to model earlier, beginning in the fifth year, when
engines would use. year 2016 and thereafter. The allowance the 5 percent allowance takes effect,
In the two power categories where we to use the higher FEL caps is not these engines will be considered Tier 4
are adopting phase-in provisions (i.e., applicable for the 2008 standards or the engines and all other requirements for
75 to 175 horsepower engines and 175 2013 NMHC+NOX standards for these Tier 4 engines will also apply, including
to 750 horsepower engines), the engines because the FEL caps for those the Tier 4 NMHC standard, transient
allowance to use a higher FEL cap will standards already are set at the level of testing, NTE testing, and closed
only apply to PM from phase-out the standard which previously applied. crankcase controls.
TABLE III.A–2.—ALLOWANCE FOR LIMITED USE OF AN FEL CAP HIGHER THAN THE TIER 4 FEL CAPS
Engines al-
lowed to
Power category Model years NOX FEL cap (g/bhp-hr) PM FEL cap (g/bhp-hr)
have higher
FELs (%)
25 ≤ hp < 75 .............. 2013–2016 a ................................ b 40 Not applicable ............................. 0.22

(19 ≤ kW < 56) ........... 2017+ a ........................................ 5
75 ≤ hp < 175 ............ 2012–2015 .................................. b 40 3.3 c for hp <100 .......................... 0.30 d for hp <100
(56 ≤ kW <130) .......... 2016+ .......................................... 5 2.8 c for hp ≥100 .......................... 0.22 d for hp ≥100
175 ≤ hp ≤ 750 .......... 2011–2014 .................................. b 40 2.8 c ............................................. 0.15 d
(130 ≤ kW ≤ 560) ....... 2015+ .......................................... 5
>750 hp ...................... 2015–2018 .................................. b c 40 2.6 ............................................... 0.075
(>560 kW) .................. 2019+ .......................................... e5 .
a For manufacturers choosing to opt out of the 2008 model year Tier 4 standards for engines between 50 and 75 horsepower and instead com-
ply with the Tier 4 standards beginning in 2012, the 40% allowance would apply to model years 2012 through 2015, and the 5% allowance would
apply to model year 2016 and thereafter.
b Compliance with the 40% limit is determined by adding the percent of engines that have FELs above the FEL caps shown in Table III.A.–1 in
each of the four years. A manufacturer may not have more than 20% of its engines exceed the FEL caps shown in Table III.A–1 in any model
year in any power category.
c The allowance to certify to these higher NO FEL caps is not applicable during the phase-in period.
X
d These higher PM FEL caps are applicable to phase-out engines only during the phase-in period.
e The limits of 40% or 5% allowed to exceed the NO FEL cap would apply to engines used in generator sets only. (Engines >750 hp used in
X
other machines are allowed to have an NOX FEL as high as 4.6 g/bhp-hr.) The limits of 40% or 5% allowed to exceed the PM FEL cap would
apply to all engines above 750 hp.
Under the Tier 4 program, there will horsepower engines during the NOX out engines’’), engines will certify to the
be two different groups of 75–750 phase-in period. In one group (‘‘phase- applicable Tier 3 NMHC+NOX standard
and will be subject to the NMHC+NOX manufacturer could garner nearly 0.3 g/ such credits would not expire. We
ABT restrictions and allowances bhp-hr of NMHC+NOX credit for each of disagree that adopting a restriction on
previously established for Tier 3. In the these engines produced. Allowing these the use of the previous tier ABT credits
other group (‘‘phase-in engines’’), NMHC-derived credits to be used is an unconstitutional taking. EPA did
engines will certify to the 0.30 g/bhp-hr undiscounted to offset NOX emissions not, and could not, decide in the Tier 2/
NOX standard, and will be subject to the on the phase-in engines in 2011 (for 3 rulemaking that Tier 2/3 credits could
restrictions and allowances in this which each 0.1 g/bhp-hr of margin can be used to show compliance with some
program. Although engines in each make a huge difference in facilitating future standards that had not yet even
group are certified to different the design of engines to meet the 0.30 been adopted. Thus, EPA in this
standards, we are (as proposed) g/bhp-hr NOX standard) would be rulemaking is not taking away
allowing manufacturers to transfer inappropriate. Therefore, while we are something previously given. We are not
credits across these two groups of reducing the value of credits earned revisiting the Tier 2/3 standards but
engines with the following adjustment from Tier 2/Tier 3 engines, the establishing a new set of engine
to the amount of credits generated. adjustment accounts for the NMHC standards. In doing so, we necessarily
Manufacturers will be able to use credits fraction of the credits which we do not must evaluate the provisions of previous
generated during the phase-out of believe should be used to demonstrate rules and their potential impact on the
engines subject to the Tier 3 compliance with the NOX-only Tier 4 future standards being considered. We
NMHC+NOX standard to average with standards (such credits would be are reasonably concerned that credits
engines subject to the 0.30 g/bhp-hr ‘‘windfalls’’ because they would from engines certified to relatively high
NOX standard, but these credits will be necessarily occur by virtue of the standards could be used to significantly
subject to a 20 percent discount, the technology needed to meet the PM delay the implementation of the final
adjustment reflecting the NMHC standard) (68 FR 28469, May 23, 2003). Tier 4 program and its benefits,
contribution. Thus, each gram of Second, the discounting will work resulting in a situation where the
NMHC+NOX credits from the phase-out toward providing a small net standards would no longer reflect the
engines will be worth 0.8 grams of NOX environmental benefit from the ABT greatest degree of emission reduction
credits in the new ABT program. The program, such that the more available as required under section
ability to average credits between the manufacturers use banked and averaged 213(a)(3) of the Clean Air Act, or would
two groups of engines will give credits, the greater the potential no longer be appropriate under section
manufacturers a greater opportunity to emission reductions overall. Most 213(a)(4) of the Clean Air Act.
gain experience with the low-NOX basically, it is inherently reasonable, in Therefore, with today’s action, we are
technologies before they are required to using NOX+NMHC reductions to show adopting the proposed provisions
meet the final Tier 4 standards across credit with a NOX-only standard, to use regarding the use of credits from
their full production. The 20 percent only that portion which represents NOX previous tier engines, with one minor
discount will also apply, for the same reductions. (Indeed, for this reason, revision.
reason, to all NMHC+NOX credits used terming the 20 per cent a ‘‘discount Under today’s action, manufacturers
for averaging purposes with the NOX factor’’ is a misnomer; it apportions the
standards for engines greater than 75 may only use credits generated from
NMHC fraction of the reduction.) As other Tier 4 engines or from engines
horsepower. noted, this is further supported by the
The California Air Resources Board certified to the previously applicable
fact that the NMHC reductions for tier of standards—except for engines
supported the proposed discount of 20
phase-out engines are not extra between 50 and 75 horsepower. Because
percent on NMHC+NOX credits used for
reductions above and beyond what we are adopting Tier 4 standards that
NOX compliance. The Engine
would otherwise occur, and therefore take effect as early as 2008 for those
Manufacturer’s Association commented
don’t warrant eligibility as credits. engines, the same year the previously-
that we should eliminate the 20 percent
‘‘discount’’ on NMHC+NOX credits used We are adopting one additional adopted Tier 3 standards are scheduled
for NOX compliance. restriction on the use of credits under to take effect (see section II.A.1.a above),
We disagree with the Engine the ABT program. For the Tier 4 there is no possibility to earn credits
Manufacturer’s Association comments. standards, we proposed that against the Tier 3 standards for
As noted in the proposal, we have two manufacturers could only use credits manufacturers that certify with the pull-
main reasons for adopting this generated from other Tier 4 engines or ahead standards in 2008 for engines
adjustment. First, the discounting from engines certified to the previously between 50 and 75 horsepower.
addresses the fact that NMHC applicable tier of standards (i.e., Tier 2 Therefore, we will allow manufacturers
reductions can provide substantial for engines below 50 horsepower, Tier to use credits from engines in the Tier
NMHC+NOX credits, which are then 3 for engines between 50 and 750 2 power category that includes 50 to 75
treated as though they were NOX horsepower, and Tier 2 engines above horsepower (i.e., the 50 to 100
credits. For example, a 2010 model year 750 horsepower). This proposed horsepower category) that are certified
175 horsepower engine emitting at 2.7 restriction was similar to a restriction to the Tier 2 standards if they choose to
g/bhp-hr NOX and 0.3 g/bhp-hr NMHC we currently have that prohibits the use demonstrate compliance with the pull-
meets the 3.0 g/bhp-hr NMHC+NOX of Tier 1 credits to demonstrate Tier 3 ahead Tier 4 standards in 2008 for
standard in that year, but gains no compliance. STAPPA/ALAPCO and the engines between 50 and 75 horsepower.
credits. In 2011, that engine, equipped Natural Resources Defense Council Manufacturers that do not choose to
with a PM trap to meet the new PM supported the proposed approach that comply with the 2008 Tier 4 standards
standard, will have very low NMHC limited the use of previous-tier credits for engines between 50 and 75
emissions because of the trap, an for Tier 4. The Engine Manufacturer’s horsepower and instead comply with
emission reduction already accounted Association commented that by limiting the 2012 Tier 4 standards for such
for in our assessment of the air quality the use of previous-tier credits, we are engines will not be allowed to use Tier
benefit of this program. As a result, engaged in an unconstitutional taking 2 credits in Tier 4, but instead will be
without substantially redesigning the because EPA had guaranteed in the allowed to use Tier 3 credits as allowed
engine to reduce NOX or NMHC, the previous Tier 2/Tier 3 rulemaking that under the standard provisions regarding
use of previous-tier credits only for Tier One engine manufacturer commented Tier 3 engines will continue to apply if
4 compliance demonstration. that EPA should include a barrier to they are used to demonstrate
With regard to other restrictions on trading credits across the 75 horsepower compliance for Tier 4 engines.)
the use of ABT credits, we are adopting level. They cited concerns over the EPA also proposed to allow engine
one restriction on the use of credits ability of manufacturers that produce a manufacturers to demonstrate
across the 750 horsepower threshold. In large range of engine sizes to use credits compliance with the NOX phase-in
previous rulemakings, EPA has defined from high horsepower engines to offset
requirements by certifying evenly split
‘‘averaging sets’’ within which emissions from their small horsepower
engine families at, or below, specified
manufacturers may use credits under engines. We are not adopting any
the ABT program. Credits may not be NOX FELs (68 FR 28470, May 23, 2003).
averaging set restrictions for Tier 4
used outside of the averaging set in As described in section II.A.2.c above,
engines below 750 horsepower in
which they were generated. As EPA is revising the evenly split family
today’s action. In the current nonroad
described in section II.A.4 of today’s diesel ABT program, there are averaging provisions for the Tier 4 program and is
action, we have revised the Tier 4 set restrictions. The current averaging now codifying them as alternative
standards for engines above 750 sets consist of engines less than 25 standards. (As described in section III.L,
horsepower. Because the standards for horsepower and engines greater than or we also are adopting the proposed
Tier 4 engines greater than 750 equal to 25 horsepower. We adopted provisions allowing manufacturers to
horsepower will not be based on the use this restriction because of concerns over certify ‘‘split’’ engine families during
of PM aftertreatment technology in 2011 the ability of manufacturers to generate the phase-in years.) Because the evenly
or NOX aftertreatment technology for all significant credits from the existing split family provision has evolved into
mobile machinery engines in 2015, we engines and use the credits to delay a set of alternative NOX standards, we
are adopting provisions that prevent compliance with the newly adopted believe it is appropriate to allow
manufacturers from using credits from standards (63 FR 56977, October 23, manufacturers to use ABT for them.
model year 2011 and later model year 1998). We believe the Tier 4 standards Table III.A–3 presents the FEL caps that
engines greater than 750 horsepower to for engines below 750 horsepower are will apply to engines certified to the
demonstrate compliance with engines sufficiently rigorous to limit the ability alternative NOX standards during the
below 750 horsepower. Without such a of manufacturers to generate significant phase-in years. The FEL caps for these
limit, we are concerned that credits from their engines. In addition, alternative standards have been set at
manufacturers could use credits from we believe the FEL caps being adopted levels reasonably close to the alternative
such engines to significantly delay today provide sufficient assurance that standards and are intended to ensure
compliance with the numerically lower low-emissions technologies will be sizeable emission reductions from the
standards for engines below 750 introduced in a timely manner. previously-applicable Tier 3 standards.
horsepower. In addition, without such a Therefore, we believe averaging can be (For engines between 75 and 175
limit, we are concerned that allowed between all engine power horsepower certified under the reduced
manufacturers could use credits from categories below 750 horsepower phase-in option, the FEL cap is the
engines below 750 horsepower to delay without restriction effective with the NOX-only equivalent of the previously
implementation of aftertreatment Tier 4 standards. (It should be noted applicable NMHC+NOX standards
technology for engines above 750 that the averaging set restriction placed because the alternative standard is
horsepower. on credits generated from Tier 2 and sufficiently close to the Tier 3 standard.)
TABLE III.A–3.—NOX FEL CAPS FOR ENGINES CERTIFIED TO THE ALTERNATIVE NOX STANDARDS
Alternative NOX FEL cap (g/bhp-
Power category NOX standard hr)
(g/bhp-hr)
50/50/100 phase-in option for 75 ≤ hp < 175 (56 ≤ kW <130) ................................................................... 1.7 2.2.
25/25/25/100 phase-in option for 75 ≤ hp < 175 (56 ≤ kW <130) .............................................................. 2.5 3.3 (for 75–100 hp).
2.8 (for 100–175 hp)
175 ≤ hp ≤ 750 (130 ≤ kW ≤ 560) ............................................................................................................... 1.5 2.0.
Because we are allowing 40 percent over the first four years the NMHC+NOX standards. For
manufacturers to use ABT for Tier 4 standards take effect as described manufacturers certifying under the
demonstrating compliance with the earlier). Table III.A–4 presents the NOX reduced phase-in (25 percent) option,
alternative standards for engines FEL caps that would apply to engines because the FEL caps are the NOX-only
between 75 and 750 horsepower, we are certified under the alternative standards equivalent of the Tier 3 NMHC+NOX
allowing manufacturers to exceed the (limited by the 40 percent cap over the standards, they may not exceed the FEL
FEL caps noted in table III.A–3 and first four years). The higher NOX FEL cap during the years the alternative
include them in the count of engines caps are set at the estimated NOX-only standard applies.
allowed to exceed the FEL caps (i.e., the equivalent of the previous-tier
TABLE III.A–4.—LIMITED-USE NOX FEL CAPS UNDER THE ALTERNATIVE NOX STANDARDS
NOX FEL cap (g/bhp-
Power category Model years hr)
50/50/100 phase-in option for 75 ≤ hp < 175a ............................................................................................ 2012–2013 3.3 for hp <100.
(56 ≤ kW <130) ............................................................................................................................................ 2.8 for hp ≥100.
175 ≤ hp ≤ 750 ............................................................................................................................................ 2011–2013 2.8.
TABLE III.A–4.—LIMITED-USE NOX FEL CAPS UNDER THE ALTERNATIVE NOX STANDARDS—Continued
NOX FEL cap (g/bhp-
Power category Model years hr)
(130 ≤ kW ≤ 560) .........................................................................................................................................
For reasons explained in section will be permitted). This restriction will Tier 4 timeframe. No adverse comments
II.A.1.b.i above, we are also adopting apply throughout this period even if the were submitted to EPA on this issue.
unique phase-in requirements for NOX reduced phase-in option is exercised As explained in the proposal, we are
standards for engines between 75 and during only a portion of this period. We not applying a specific discount to Tier
175 horsepower in order to ensure believe that this restriction is important 3 PM credits used to demonstrate
appropriate lead time for these engines. to avoid potential abuse of the added compliance with the Tier 4 standards
Because of these unique phase-in flexibility allowance, considering that (68 FR 28471, May 23, 2003). PM credits
provisions, as proposed, we are larger engine categories will be required generated under the Tier 3 standards are
adopting slightly different provisions to demonstrate substantially greater based on testing performed over a
regarding 75 to 175 horsepower engines’ compliance levels with the 0.30 g/bhp steady-state test cycle. Under the Tier 4
use of previous-tier credits. Under hr NOX standard several years earlier standards, the test cycle is being
today’s action, manufacturers that than engines built under the reduced supplemented with a transient test (see
choose to demonstrate compliance with phase-in option. section III.F.1 below). Because in-use
these phase-in requirements (i.e., 50 As described in section II.A.3.a of PM emissions from Tier 3 engines will
percent in 2012 and 2013 and 100 today’s action, and as proposed, we are vary depending on the type of
percent in 2014) or the 1.7 g/bhp-hr adopting an optional PM standard for application in which the engine is used
alternative NOX standard (which is air-cooled, hand-startable, direct (most applications having higher in-use
based on the 50 percent phase-in injection engines under 11 horsepower PM emissions, some having lower in-
option) will be allowed to use Tier 2 effective in 2010. In order to avoid use PM emissions), the relative ‘‘value’’
NMHC+NOX credits generated by potential abuse of this standard, engines of the Tier 3 PM credits in the Tier 4
engines between 50 and 750 horsepower certified under this requirement will not timeframe will differ. Instead of
(even though they are not generated by be allowed to generate any credits as requiring manufacturers to gather
previous-tier engines), along with any part of the ABT program. Credit use by information to estimate the level of in-
other allowable credits, to demonstrate these engines will be allowed. The use PM emissions compared to the PM
compliance with the Tier 4 NOX restriction on generating credits should level of the steady-state test, we believe
standards for engines between 75 and not be a burden to manufacturers, as it allowing manufacturers to bring Tier 3
175 horsepower during model years will apply only to those air-cooled, PM credits directly into the Tier 4 time
2012, 2013 and 2014 (the years of the hand-startable, direct injection engines frame without any adjustment is
phase-in) only. These Tier 2 credits will under 11 horsepower that are certified appropriate because it discounts their
be subject to the power rating under the optional approach, and the value for use in the Tier 4 timeframe
conversion already established in our production of credit-generating engines (since the initial baseline being reduced
ABT program, and to the 20% credit would be contrary to the standard’s is higher than measured in the Tier 2
adjustment being adopted today for use purpose. No adverse comments were test procedure for most applications).
of NMHC+NOX credits as NOX credits. submitted to EPA on this issue. No adverse comments were submitted to
The requirements for manufacturers The current ABT program contains a EPA on this issue.
that choose to demonstrate compliance restriction on trading credits generated
from indirect injection engines greater 3. Are We Expanding the Nonroad ABT
with the optional reduced phase-in
than 25 horsepower. The restriction was Program To Include Credits From
requirement for engines between 75 and
originally adopted because of concerns Retrofit of Nonroad Engines?
175 horsepower (i.e, the 25/25/25
percent phase-in option; see Table II.A.– over the ability of manufacturers to In the proposal, we requested
2, note b) or the 2.5 g/bhp-hr alternative generate significant credits from existing comment on expanding the scope of the
NOX standard (which is based on the 25 technology engines (63 FR 56977, standards by setting voluntary new
percent phase-in option) are different. October 23, 1998). With today’s action, engine emission standards applicable to
Under the reduced phase-in there will be no restriction prohibiting the retrofit of nonroad diesel engines (68
requirement, use of credits will be manufacturers from trading credits FR 28471, May 23, 2003). As described
allowed in accordance with the general generated on Tier 4 indirect fuel in the proposal, retrofit nonroad engines
ABT program provisions. In other injection engines greater than 25 would be able to generate PM and NOX
words, manufacturers will not have the horsepower. Based on the certification credits which would be available for use
special allowance to use Tier 2 levels of indirect injection engines, we by new nonroad engines in the
NMHC+NOX credits generated by do not believe there is the potential for certification ABT program. We received
engines between 50 and 750 horsepower manufacturers to generate significant a significant number of comments on a
noted above to demonstrate compliance credits from their currently certified retrofit ABT program. A number of
with the Tier 4 standards. In addition, engines against the Tier 4 standards. commenters associated with the
manufacturers choosing the reduced Therefore, as proposed, we are not agricultural sector were concerned
phase-in option will not be allowed to adopting any restrictions on the trading retrofits would be mandatory. Some
generate NOX credits from engines in of credits generated on Tier 4 indirect commenters were opposed to a retrofit
this power category in 2012, 2013, and injection engines to other credit program that would allow use of
most of 2014, except for use in manufacturers. The restriction placed the credits under the certification ABT
averaging within this power category on the trading of credits generated from program. However, a number of
(i.e., no banking or trading, or averaging Tier 2 and Tier 3 indirect injection commenters supported the concept of a
with engines in other power categories engines will continue to apply in the retrofit program, but noted a number of
concerns regarding the details of such a 56978, October 23, 1998 and 68 FR with today’s action. Areas in which we
program, including making sure that 28472–28476, May 23, 2003). have made changes to the proposed
any credits earned would be verifiable Given the levels of the newly adopted transition program are highlighted. A
and enforceable. Some commenters Tier 4 standards, we believe that there complete summary of comments
suggested that EPA consider the will be engine design and other changes received on the proposed transition
establishment of a retrofit credit at least comparable in magnitude to program and our response to those
program through a separate rulemaking those involved during the transition to comments are contained in the
because there were many details of the Tier 2/3. Therefore, with a few Summary and Analysis of Comments
program that needed to be explored exceptions described in more detail document for this rule.
more fully before adopting such a below, we are adopting transition EPA believes that the lead time
program. In response to the comments, provisions for Tier 4 that are similar to provided through the equipment maker
we are not adopting a retrofit credit those adopted with the previous Tier 2/ transition flexibilities, as adopted in this
program with today’s action. Although 3 rulemaking. We also note that rule, will be sufficient, as has proved
we provided a detailed explanation of a opportunities for greater flexibility the case in past tiers. These flexibilities
potential program at proposal, 62 we arises from the structure of the Tier 4 provide equipment manufacturers with
believe it is important to more fully rule. For example, Tier 4 consolidates the selective ability to delay use of the
consider the details of a nonroad engine the nine power categories in Tier 2/3 Tier 4 engines in those applications
retrofit credit program and work with into five categories, providing where additional time is needed to
interested parties in determining opportunities for more flexibility by successfully incorporate the redesigned
allowing more engine families within engines into their equipment.
whether a viable program can be
each power category, with consequent Ingersoll-Rand, an equipment
developed. EPA intends to explore the manufacturer, submitted a number of
increased averaging possibilities. The
possibility of a voluntary, opt-in comments arguing that significant
NOX phase-in also provides increased
nonroad retrofit credit program through expansions of the proposed flexibility
flexibility opportunities, as do the
a separate action later this year. Such a program are needed if equipment
longer Tier 4 lead times.
program would be based on the We are adding new notification, manufacturers are to produce compliant
generation of credits beyond the scope reporting, and labeling requirements to applications within the effective dates
of any existing retrofit program. The the Tier 4 program. We believe these of the standards. One suggestion was for
final rule contains no requirements for additional provisions are necessary for EPA to include provisions that provide
retrofitting existing engines or EPA to gain a better understanding of a definitive period of lead time for
equipment. the extent to which these provisions incorporation of Tier 4 engines into
B. Transition Provisions for Equipment will be used and to ensure compliance nonroad equipment. Ingersoll-Rand
Manufacturers with the Tier 4 transition provisions. would have the rules specify a ‘‘made
We are also adopting new provisions available’’ date before which each
1. Why Are We Adopting Transition dealing specifically with foreign engine supplier must provide technical
Provisions for Equipment equipment manufacturers and the and performance specifications,
Manufacturers? special concerns raised by the use of the complete drawings, and a final
transition provisions for equipment compliant engine to EPA and the open
As EPA developed the 1998 Tier 2/3 imported into the U.S. The following market. After the mandated ‘‘made
standards for nonroad diesel engines, section describes the Tier 4 transition available’’ date, equipment
we determined, as an aspect of provisions available to equipment manufacturers should be provided a
determining an appropriate lead time manufacturers. (Section III.C of this minimum 18 months of lead time to
for application of the requisite preamble describes all of the provisions incorporate the new engines into
technology (pursuant to section 213(b) that will be available specifically for nonroad equipment. One form of the
of the Act), that provisions were needed small businesses.) suggestion also entailed a prohibition on
to avoid unnecessary hardship and to As under the existing Tier 2/Tier 3 design changes once the engine,
create additional flexibility for provisions, equipment manufacturers specifications, drawings, etc. had been
equipment manufacturers. The specific are not obligated to use any of these initially provided to EPA and to the
concern is the amount of work required provisions, but all equipment open market. As an alternative,
and the resulting time needed for manufacturers are eligible to do so. Ingersoll-Rand urged that the percent of
equipment manufacturers to incorporate Also, as under the existing program, all production allowance flexibility be
all of the necessary equipment redesigns entities under the control of a common expanded to 150 percent for the power
into their applications in order to entity, and that meet the regulatory categories between 75 and 750
accommodate engines that meet the new definition of a nonroad vehicle or horsepower and 120 percent for the
emission standards. We therefore nonroad equipment manufacturer, must power category between 25 and 75
adopted a set of provisions for be considered together for the purpose horsepower. Ingersoll-Rand believes
equipment manufacturers to provide of applying exemption allowances. This these levels correspond proportionately
them with reasonable lead time for the will not only provide certain benefits for to the increased challenges facing
transition process to the newly adopted the purpose of pooling exemptions, but equipment manufacturers during Tier 4
standards. The program consisted of will also preclude the abuse of the as opposed to Tier 2 and Tier 3.
four major elements: (1) A percent-of- small-volume allowances that would As discussed in greater detail in the
production allowance, (2) a small- exist if companies could treat each Summary and Analysis of Comments, as
volume allowance, (3) availability of operating unit as a separate equipment well as in later parts of this section of
hardship relief, and (4) continuance of manufacturer. this preamble and elsewhere in the
the allowance to use up existing administrative record, we disagree with
inventories of engines (63 FR 56977– 2. What Transition Provisions Are We most of Ingersoll-Rand’s suggestions.
Adopting for Equipment Manufacturers? Our fundamental disagreement is with
62 See memorandum referenced at 68 FR 28471 The following section describes the Ingersoll-Rand’s premise that Tier 4 will
(May 23, 2003), footnote 299. transition provisions being adopted create a situation where need for
expanded equipment maker lead time is of the engine design and validation selection of any single made available
the norm rather than the exception so process.63 date is bound to be arbitrary in most
that the rule must provide a drastic, We also have studied the extent to situations. We also believe that the 18-
across-the-board expansion of which equipment manufacturers have month lead time following a made
equipment manufacturer lead time. We used their flexibilities under the Tier 2/ available date entails a mandated 18-
believe that the lead time provided for 3 program. Although at an early stage in month period (at least) with no return
equipment makers in this rule is the Tier 2/3 process, initial indications on investment to engine suppliers (i.e.
adequate, and that the equipment maker are that the flexibility program is being the period between when the Tier 4
flexibilities we are adopting provide a used by many equipment engine would be produced and when it
reasonable and targeted safety valve to manufacturers, but in general, could lawfully be sold), which would
manufacturers do not appear to be using increase the engine cost, and discourage
deal with isolated problems. There is no
the full level of allowances.64 It appears design changes (since such changes
across-the-board problem necessitating a
that the flexibilities are being used as would entail more investment with
drastic expansion of equipment
EPA intended, providing manufacturers delayed return on that investment). The
manufacturer lead time, or a drastic with flexibility to deal with specific
expansion of equipment manufacturer ultimate result would be a costlier rule
limited situations, rather than to deal and less environmental benefit due to
flexibilities. We base these conclusions with an across-the-board problem.
largely on three factors: (a) Our the delay in introducing Tier 4 engines.
The emerging pattern is thus the one Even were EPA to put forth such a
investigation and understanding of the on which the flexibility program is regulation, it is not clear that it could be
engineering process by which engine predicated: there is not a need for enforced or that it would help the
makers and equipment manufacturers across-the-board drastic expansion of situation. It would only be natural for
bring new products to market; (b) the equipment manufacturer lead time. engine manufacturers to continue to
specific engineering challenges which Indeed, such an expansion would be improve its products even after the
equipment manufacturers will address inconsistent with the lead time-forcing predefined ‘‘made available date’’ and
in complying with the Tier 4 rule; and nature of section 213 (b) of the Act. This equipment manufacturers would want
(c) past practice of equipment is not to say that there is no need for to use this improved product even if it
manufacturers under previous rules equipment manufacturer flexibilities, or meant they had to make last minute
providing transition flexibilities for that the Tier 2/3 flexibility format need changes to the equipment design. For
nonroad equipment. not be adjusted to accommodate EPA to preclude engine manufacturers
Because it is in both parties’ interest potential problems to be faced under the from changing their product designs
for new engines and new equipment Tier 4 regime. Instances where over the period between the certification
applications to reach the market additional lead time could be justified date and the equipment manufacturer
are where resource constraints prevent
expeditiously, engine makers and date would be both unusual and
completion of certain applications, or
equipment manufacturers usually adopt counterproductive to our goal of seeing
where for business reasons it makes
concurrent engineering programs the best possible products available in
sense for equipment manufacturers to
whereby the new equipment design the market. Moreover, EPA sees no need
delay completion of small volume
process occurs simultaneous to the new to interfere with the concurrent design
families in order to complete larger
engine development process. We believe market mechanism, which allows
volume equipment applications. In
that this concurrent process should engine makers and equipment
addition, the Tier 2/3 experience
work well for Tier 4 because, in many manufacturers to negotiate optimal
illustrates that there can be instances
important ways, the engineering solutions. We believe it is better to leave
where emission control optimization
challenges facing equipment which necessitates equipment design to the market participants the actual
manufacturers can be anticipated and changes occurs late in the design cycle, decision for how and when to conduct
dealt with early in the design process. resulting in a need for additional concurrent engineering designs.
We expect that relatively early in the equipment manufacturer lead time. The The California Air Resources Board
design process, engine manufacturers equipment manufacturer flexibilities commented that EPA should eliminate
will be able to define the size and adopted in today’s rule accommodate or reduce the amount of flexibilities
characteristics of the emission control these possibilities. provided for less than 25 horsepower
technologies (e.g., NOX adsorbers and We have specific objections to engines, because the Tier 4 engine
CDPFs), based on the same systems that Ingersoll-Rand’s preferred approach of a standards are not aftertreatment-based.
will be in production for on-highway mandated made available date, followed The Engine Manufacturers Association
engines. The equipment manufacturers by 18 months of additional lead time for commented that we should expand the
will concurrently redesign their equipment manufacturers. amount of flexibilities for engines
equipment to accommodate these new Superimposing a government mandate greater than 750 horsepower, given the
technologies, including designing, on the engine maker—equipment difficulty of complying with the
mounting and supporting the catalytic manufacturer business relationship proposed standards for engines above
equipment similar to current exhaust insinuates EPA into the middle of 750 horsepower. With today’s action,
muffler systems. contractual/market relationships (e.g., we are applying the same flexibility for
when is an objectively reasonable all power categories, including engines
Moreover, while we expect the delivery date?), forcing EPA to prejudge below 25 horsepower and engines above
redesign challenge for Tier 4 equipment myriad differing business relationships/ 750 horsepower. While it is true that the
to be similar to that for Tier 2/3, we also engineering situations. Moreover, Tier 4 standards for engines below 25
expect the redesign to be better and horsepower are not aftertreatment
more clearly defined well in advance of 63 ‘‘Tier 4 Nonroad Diesel Equipment Flexibility
based, we believe there will be changes
the Tier 4 introduction dates. This is Provisions,’’ memorandum from Byron Bunker, et in engine design for many of those
because we do not expect the catalyst al., (EPA) to EPA Air Docket OAR–2003–0012.
64 ‘‘Tier 4 Nonroad Diesel Equipment Flexibility engines in response to the Tier 4
system size or shape to change Provisions,’’ memorandum from Byron Bunker, et standards. As engine designs change,
significantly during the last 24 months al., (EPA) to EPA Air Docket OAR–2003–0012. there is the potential for impacts on
equipment design as well (as shown in they may use flexibilities in the year the provisions to allow equipment
implementing the Tier 2/3 rule). final Tier 4 standards (the manufacturers to have the option of
Therefore, we believe providing aftertreatment-based standards for both starting the seven-year period in which
equipment manufacturer flexibility for PM and NOX) take effect. Put another flexibility engines may be used in either
engines below 25 horsepower is way, they would not need more lead the first year of the interim Tier 4
appropriate and we are adopting the time for equipment to meet the interim standards or the first year of the final
same flexibilities for engines below 25 standards, but could need more lead Tier 4 standards. For engines between
horsepower as for other power time for equipment required to meet the 25 and 75 horsepower, the final Tier 4
categories. With regard to engines above final standards. In addition, the standards may begin in 2012 or 2013
750 horsepower, we are retaining the commenter suggested a modified
depending on whether the manufacturer
same flexibilities for those engines as for approach that could lead to earlier
chooses to comply with the interim
other power categories. As described in emission reductions than under the
section II.A.4, the Tier 4 standards being proposed rule: Requiring delayed 2008 Tier 4 standards. An equipment
adopted today for engines above 750 flexibility engines to meet the interim manufacturer who does not use
horsepower have been revised from the Tier 4 standards instead of meeting the flexibilities in 2008 thus may need
proposal. We believe that these Tier 2/3 standards (as would have been flexibilities as early as 2012. Therefore,
revisions have appropriately allowed under the proposal if the the seven-year period for the final Tier
accommodated concerns for the most flexibilities started in the first year of 4 standards for engines between 25 and
difficult to design applications (i.e., the interim Tier 4 standards). 75 horsepower will begin in 2012
NOX adsorbers for engines in mobile EPA wants to encourage the instead of 2013. Moreover, it is clearly
applications), so that additional implementation of the Tier 4 standards appropriate that these delayed
equipment flexibilities are not as early as possible. Therefore, we flexibility engines meet the interim Tier
warranted for these engines. believe it makes sense to provide 4 standards, in order not to backslide
The Engine Manufacturers incentives to equipment manufacturers from existing levels of performance.
Association commented that some to use interim Tier 4 compliant engines
Table III.B–1 shows the years in
equipment manufacturers may be in their equipment during the transition
capable of making an on-time transition to the final Tier 4 standards. Moreover, which manufacturers could choose to
to the interim Tier 4 standards (e.g. the it is reasonable to expect that more lead start the Tier 4 flexibilities given the
2011 standards applicable for 175–750 time will be needed for the standards being adopted today. (The
horsepower engines) without the use of aftertreatment-based standards than for seven-year period for engines below 25
flexibilities. Such equipment the interim standards. Therefore, in horsepower takes effect in 2008 as
manufacturers would like the ability to response to these comments, we are proposed, because there are no interim
start the seven-year period in which revising the proposed flexibility standards for such engines.)
TABLE III.B–1.—FLEXIBILITY PERIODS FOR THE TIER 4 STANDARDS

Model year
flexibility Standards to which flexibility en-
Power category period gines would have to certify
options
25 ≤ hp < 75 ........................................................................................................................... 2008–2014 Tier 2 standards.

(19 ≤ kW < 56) ....................................................................................................................... 2012–2018 Model Year 2008 Tier 4 standards.
75 ≤ hp < 175 ......................................................................................................................... 2012–2018 Tier 3 standards.
(56 ≤ kW <130) ...................................................................................................................... 2014–2020 Model Year 2012 Tier 4 standards.
175 ≤ hp ≤ 750 ....................................................................................................................... 2011–2017 Tier 3 standards.
(130 ≤ kW ≤ 560) ................................................................................................................... 2014–2020 Model Year 2011 Tier 4 standards.
>750 hp .................................................................................................................................. 2011–2017 Tier 2 standards.
(>560 kW) ............................................................................................................................... 2015–2021 Model Year 2011 Tier 4 standards.
Under today’s action, and as and production of equipment to another exact situation we are attempting to
proposed, only those nonroad manufacturer. While we understand prevent with the changes to the
equipment manufacturers that install there are many different types of eligibility requirements for the
engines and have primary responsibility relationships between equipment allowances. Therefore, we are adopting
for designing and manufacturing manufacturers, we believe it is the proposed requirement that only
equipment will qualify for the important to establish firm criteria for those nonroad equipment manufacturers
allowances or other relief provided determining eligibility to use the that install engines and have primary
under the Tier 4 transition provisions. equipment manufacturer allowances. responsibility for designing, and
As a result of this definition, importers We are concerned that the change to the manufacturing equipment will qualify
that have little involvement in the equipment manufacturer definition for the allowances or other relief
manufacturing and assembling of the suggested by the commenters would provided under the Tier 4 transition
equipment will be ineligible to receive allow entities that have little or no provisions. However, we are revising
any allowances. The Engine involvement in the actual design, the provisions regarding which engines
Manufacturers Association and one manufacture and assembly of equipment an equipment manufacturer may
engine manufacturer commented that (e.g., companies that only import include in its total count of U.S.-
the proposed definition of equipment equipment) to claim they contracted directed equipment production, which
manufacturer needed to be revised to with an equipment manufacturer to in turn affects the number of allowances
cover situations in which a produce equipment for them and an equipment manufacturer may claim.
manufacturer contracts out the design therefore claim allowances. This is the Under today’s action, an equipment
manufacturer may include equipment identical to the percent-of-production be included in an equipment

produced by other manufacturers under allowance adopted in the October 1998 manufacturer’s percent of production
license to them for which they had final rule (63 FR 56967, October 23, calculations.
primary design responsibility (see 2003), the difference being, as explained The choice of a cumulative percent
section 1039.625(a) of the regulations). earlier, that there are fewer power allowance of 80 percent is based on our
This should cover the type of situation categories (and consequent increased best estimate of the degree of reasonable
described by the commenters while flexibility in spreading the flexibility lead time needed by equipment
preventing an import-only entity from among engine families) associated with manufacturers. We believe the 80
claiming it is an equipment the Tier 4 standards. percent allowance responds to the need
manufacturer and thereby gaining The 80 percent exemption allowance, for flexibility identified by equipment
access to the allowances. were it to be used to its maximum manufacturers, while ensuring a
extent by all equipment manufacturers, significant level of emission reductions
a. Percent-of-Production Allowance in the early years of the program. (As
will bring about the introduction of
Under the percent-of-production cleaner engines several months later noted in the following section III.B.2.b,
allowance adopted today, each than would have occurred if the new we are adopting a technical hardship
equipment manufacturer will be standards were to be implemented on provision that allows an equipment
allowed to install engines not certified their effective dates. However, the manufacturer to request additional relief
to the Tier 4 emission standards in a equipment manufacturer flexibility under the percent of production
limited percentage of machines program has been integrated with the allowance under certain conditions and
produced for the U.S. market. standard-setting process from the initial with EPA approval.)
Equipment manufacturers will need to development of this rule, and as such
provide written assurance to the engine b. Technical Hardship Flexibility
we believe it is a key factor in assuring
manufacturer that such engines are that there is sufficient lead time to Ingersoll-Rand commented that the
being procured for the purpose of the initiate the Tier 4 standards according to 80% percent of production allowance
transition provisions for equipment the final implementation schedule.65 level is not sufficient for Tier 4 given
manufacturers. These engines will As proposed, machines that use the stringency of the standard and the
instead have to be certified to the engines built before the effective date of difficulty engine manufacturers will
standards that would apply in the the Tier 4 standards do not have to be have complying with the standards. In
absence of the Tier 4 standards (see included in an equipment further discussions with Ingersoll-Rand
Table III.B–1 for the applicable manufacturer’s percent of production on this issue, they suggested that a
standards). As proposed, this percentage calculations under this allowance. percent of production allowance level of
will apply separately to each of the Tier Machines that use engines certified to 150% for totally non-integrated
4 power categories (engines below 25 the previous tier of standards under our equipment manufacturers (i.e.,
horsepower, engines between 25 and 75 Small Business provisions (as described equipment manufacturers producing no
horsepower, engines between 75 and in section III.C of this preamble ) do not diesel engines) was appropriate for Tier
175 horsepower, engines between 175 have to be included in an equipment 4 power categories above 25
and 750 horsepower, and engines above manufacturer’s percent of production horsepower. A fully integrated
750 horsepower) and is expressed as a manufacturer would still receive the
calculations under this allowance. All
cumulative percentage of 80 percent 80% level and partially-integrated
engines certified to the Tier 4 standards,
over the seven years beginning when the companies would receive somewhere
including those engines that produce
Tier 4 standards apply in a category (see between 80% and 150% depending on
emissions at higher levels than the
Table III.B–1 for the applicable seven- the share of self-produced engines in
standards, but for which an engine
year periods). No exemptions will be each specific power category. The basis
manufacturer uses ABT credits to
allowed after the seventh year. For for this comment is their belief that non-
demonstrate compliance, will count as
example, an equipment manufacturer integrated manufacturers are at a
Tier 4 complying engines and do not
could install engines certified to the disadvantage to integrated
have to be included in an equipment
Tier 3 standards in 40 percent of its manufacturers (manufacturers making
manufacturer’s percent of production both the engine and equipment) when it
entire 2011 production of nonroad
calculations. Engines that meet the Tier comes to planning for new Tier 4 engine
equipment that use engines rated
4 PM standards but are allowed to meet designs.
between 175 and 750 horsepower, 30
the Tier 3 NMHC+NOX standards during Although we do not accept the
percent of its entire 2012 production in
the phase-in period also count as Tier 4 premise that equipment manufacturer
this horsepower category, and 10
complying engines and do not have to lead time must be drastically expanded
percent of its entire 2013 production in
this horsepower category. (During the 65 As explained at proposal, for emissions
across-the-board for the Tier 4 program,
transitional period for the Tier 4 modeling purposes, we have assumed that
we do agree, as explained earlier, that
standards, the fifty percent of engines manufacturers take full advantage of the allowances there may be situations where
that are allowed to certify to the under the existing transition program for equipment additional lead time, in the form of
previous tier NOX standard but meet the manufacturers (adopted in the October 1998 rule; increased equipment manufacturer
see 63 FR 56967 (October 23, 2003) in establishing
Tier 4 PM standard are considered Tier the baseline emissions inventory. In modeling the
transition flexibilities, can be justified.
4-compliant engines for the purpose of impact of the Tier 4 standards, because the Therefore, we have added an additional
the equipment manufacturer transition standards will not take effect for many years and flexibility (which has no direct analogue
provisions.) If the same manufacturer it is not possible to accurately forecast use of the in the Tier 2/3 rule) to this rule in order
transition program for equipment manufacturers, so
produces equipment using engines rated to assess costs in a conservative manner, we have
to provide additional needed lead time
above 750 horsepower, a separate assumed that all engines will meet the Tier 4 in appropriate, individualized
cumulative percentage allowance of 80 standards in the timeframe required by the circumstances based on a showing of
percent will apply to those machines standards without use of the Tier 4 transition extreme technical or engineering
provisions. As discussed in section VI.C, this is
during the seven years beginning in consistent with our cost analysis, which assumes no
hardship. Ingersoll-Rand has agreed, by
2011 or 2015. This percent-of- use of the transition program for equipment letter to EPA, that this provision
production allowance is almost manufacturers. satisfies all of its concerns regarding
adequacy of lead time for meeting Tier manufacturer has received from the manufacturer, whether integrated or not,
4 standards. engine supplier, and a comparison of that uses engines from a different
This additional flexibility would be the design process for the equipment manufacturer) that makes additional
available for the three Tier 4 power model for which the exemption is relief under the percent of production
categories between 25 and 750 requested with the design process for allowance unnecessary. In addition,
horsepower. As noted earlier, Ingersoll- other models for which no exemption is integrated equipment manufacturers
Rand did not believe additional needed. The equipment manufacturer have other programs available to them
flexibility was needed for engines below also would have to make and describe (that non-integrated manufacturers do
25 horsepower. We agree because the all efforts to find other compliant not have) such as the engine averaging,
Tier 4 standards for engines below 25 engines for the model. EPA will then banking and trading program, which can
horsepower are not based on the use of evaluate and determine whether or not provide lead time flexibility during the
advanced aftertreatment. We also are to grant each such request, and what transition years. Most basically,
not including this new provision for additional increment under the percent integrated manufacturers should be able
engines above 750 horsepower because of production allowance (above the 80 to design concurrently in all
nearly all of the equipment percent normally allowed) is justified circumstances, so that extreme technical
manufacturers utilizing engines above (not to exceed an additional 70 percent or engineering hardships should not
750 horsepower make small volumes of as noted above). As part of our arise.
equipment. The small-volume evaluation of requests based on
allowance (described in the following c. Small-Volume Allowance
technical hardship, we may contact the
section) allows a manufacturer to engine supplier(s) listed by the The percent-of-production approach
exempt a specific number of engines equipment manufacturer to check on the described above may provide little
over a seven-year period, which in most accuracy of the engine-related benefit to businesses focused on a small
cases will be greater than the increased information supplied by the equipment number of equipment models, and
percentage potentially available under manufacturer. This extension of lead hence there could be situations where
this new provision. time is premised on the existence of there is insufficient lead time for such
This new provision, found in new extreme technical or engineering models. Therefore, with today’s action,
§ 1039.625(m), is a case-by-case problems, in contrast to the economic we are adopting a small-volume
exemption granted by EPA to an hardship provision described in section allowance that will allow any
equipment manufacturer. The III.B.2.f below, where consideration of equipment manufacturer to exceed the
equipment manufacturer would have economic impact is critical. percent-of-production allowances
the burden of demonstrating existence EPA would not grant an application described above during the same seven-
of extreme technical or engineering for technical hardship exemption unless year period, provided the manufacturer
hardship conditions that are outside its the equipment manufacturer limits the number of exempted engines
control. It must also demonstrate that it demonstrates that the full 80 percent to 700 total over the seven years, and to
has exercised reasonable due diligence allowed under the percent of production 200 in any one year. The limit of 700
to avoid the situation. EPA would treat allowance is reasonably expected to be exempted engines (and no more than
each request for technical hardship used up in the first two years of the 200 engines per year) applies separately
separately, with no guarantee that it seven-year flexibility period. The reason to each of the Tier 4 power categories
would grant the exemption. If EPA is obvious. If that allowance would not (engines below 25 horsepower, engines
grants the exemption, the equipment be fully utilized, then no further between 25 and 75 horsepower, engines
manufacturer could receive up to an extension of lead time can be justified. between 75 and 175 horsepower,
additional 70 percent under the percent Furthermore, any technical hardship engines between 175 and 750
of production allowance for each of the allowance would have to be used up horsepower, and engines above 750
three power categories noted above within two years after the Tier 4 percent horsepower). In addition, manufacturers
(meaning that there is a potential total of production allowances start for any making use of this provision must limit
150 percent under the percent of power category. This is because, exempted engines to a single engine
production allowance available, the although we believe that circumstances family in each Tier 4 power category.
initial 80 percent available without of extreme technical or engineering We are also adopting an alternative
application, and an additional potential hardship may arise, we cannot see that small-volume allowance, which
increment of up to 70 percent available these circumstances could not be solved equipment manufacturers have the
on a case-by-case basis). within the first two years of the option of utilizing. In discussions
The exemption could only be granted transition. Indeed, Ingersoll-Rand itself regarding the current small-volume
upon written application to EPA setting clearly indicated that this is a temporary allowance, some manufacturers
forth essentially why the normally burden which exists during initial expressed the desire to be able to
successful elements of engine maker/ model transition and indicated that only exempt engines from more than one
equipment manufacturer design cycle 18 months (rather than two years) could engine family, but still fall under the
have not provided adequate lead time be needed from receipt of the certified number of exempted engine limit. For
for a particular equipment model. The engine. that reason, we solicited comment on a
application would therefore have to This flexibility will be available to all small-volume allowance program that
address, with documentation: The equipment manufacturers, but may only would allow manufacturers to exempt
engineering or technical problems that be requested for equipment in which the engines in more than one family, but
have proved unsolvable within the lead equipment manufacturer is different have lower numerical limits. Under this
time provided, the normal design cycle than the engine manufacturer. We alternative, manufacturers using the
between the engine maker and believe that integrated manufacturers small-volume allowance could exempt
equipment manufacturer and why that who produce both the equipment and 525 machines over seven years (with a
cycle has not worked in this instance, the engine used in the piece of maximum of 150 in any given year) for
all information (such as written equipment could have an advantage in each of the three power categories below
specifications, performance data, the equipment redesign process 175 horsepower, and 350 machines over
prototype engines) the equipment (compared to an equipment seven years (with a maximum of 100 in
any given year) for the two power As with the percent-of-production horsepower engines, as discussed in
categories above 175 horsepower. allowance, machines that use engines III.C.2.b.ii.
Concurrent with the revised caps of 525 built before the effective date of the Tier
d. Early Use of Tier 4 Flexibilities in the
or 350, depending on power category, 4 standards do not have to be included
Tier 2/3 Timeframe
manufacturers could exempt engines in an equipment manufacturer’s count
from more than one engine family under of engines under the small-volume As proposed, we are also adopting
the small-volume allowance program. allowance. Similarly, machines that use provisions that allow equipment
Based on sales information for small engines certified to the previous tier of manufacturers to start using a limited
businesses, we estimated that the standards under our Small Business number of the new Tier 4 percent of
alternative small-volume allowance provisions (as described in section III.C production allowances or Tier 4 small-
program to include lower numbers of of today’s action) do not have to be volume allowances once the seven-year
eligible engines and allow included in an equipment period for the existing Tier 2/Tier 3
manufacturers to exempt more than one manufacturer’s count of engines under program expires (and so continue using
engine family would keep the total the small-volume allowance. All engines meeting Tier 1 or Tier 2
number of engines eligible for the engines certified to the Tier 4 standards, standards). In this way, a manufacturer
allowance at roughly the same overall including those that produce emissions can potentially continue exempting the
level as the 700-unit program.66 We also at higher levels than the standards but most difficult applications once the
requested comment on allowing for which an engine manufacturer uses seven-year period of the current Tier 2/
equipment manufacturers to choose ABT credits to demonstrate compliance, 3 flexibility provisions is finished.
between the two small-volume will be considered to be Tier 4 (Under the existing transition program
allowance programs described above (68 complying engines and do not have to for equipment manufacturers, any
FR 28474–28475, May 23, 2003). be included in an equipment unused Tier 2/3 allowances expire after
Both engine and equipment manufacturer’s count of engines under the seven-year period.) However, opting
manufacturers supported dropping the the small-volume allowance. Engines to start using Tier 4 allowances once the
one engine family restriction from the that meet the Tier 4 PM standards but seven-year period from the current Tier
700 unit small-volume allowance. In are allowed to meet the Tier 3 2/Tier 3 program expires will reduce the
addition, they commented that if the NMHC+NOX standards during the number of exemptions available from
one engine family restriction was not phase-in period (i.e., phase-out engines) the Tier 4 standards under either the
percent of production allowance or the
dropped from the 700 unit option, they will also be considered as Tier 4
small-volume allowance.
supported the option of allowing complying engines and do not have to
With today’s action, equipment
equipment manufacturers to choose be included in an equipment manufacturers may use up to a total of
between the two small-volume manufacturer’s count of engines under 10 percent of their Tier 4 percent of
allowance options. With today’s action, the small-volume allowance. All production allowances or up to 100 of
we are revising the proposed small- engines used under the small-volume their Tier 4 small-volume allowances
volume allowance to allow equipment allowance must certify to the standards prior to the effective date of the Tier 4
manufacturers to choose between the that would be in effect in the absence of standards. (The early use of Tier 4
700 unit over seven years option, with the Tier 4 standards (see Table III.B–1 allowances will be allowed in each Tier
exempted engines limited to one engine for the applicable standards). As noted 4 power category.) This amount of
family, or the proposed alternative earlier, equipment manufacturers will equipment utilizing the early Tier 4
which would allow equipment need to provide written assurance to the allowances will be subtracted from
manufacturers to exempt fewer engines engine manufacturer when it purchases either the Tier 4 allowance of 80 percent
over seven years (525 or 350 units, engines under the transition provisions under the percent of production
depending on the power category), but for equipment manufacturers. allowance or the applicable limit under
with no restriction on the number of The Engine Manufacturers the small-volume allowance for the
engine families that could be included Association commented that the appropriate power category, resulting in
in the exempted engine count. Based on proposed regulations for the small- fewer allowances once the Tier 4
our analysis of small businesses noted volume allowance established a limit on standards take effect. For example, if an
above, we expect the number of engines the total number of engines an equipment manufacturer uses the
that could be exempted under either equipment manufacturer could use that maximum amount of early Tier 4
option is roughly the same. Giving did not meet the Tier 4 standards and percent of production allowances of 10
equipment manufacturers the ability to should be revised to set a limit based on percent, then the manufacturer will
choose between the two options should U.S.-directed production (consistent have a cumulative total of 70 percent
not significantly impact the number of with the proposed regulatory language remaining for that power category when
engines likely to be exempted under the for the percent-of-production the Tier 4 standards take effect (i.e., 80
small-volume allowance. We have not allowance). EPA agrees that the limit percent production allowance minus 10
chosen to drop the one engine family under the small-volume allowance percent).
restriction from the 700-unit small- should apply to U.S.-directed The California Air Resources Board
volume allowance because it would production only—as the commenter commented that we should discount the
result in a significant increase in the surmised, this is what EPA intended— early use of Tier 4 flexibilities to
number of engines eligible to be and has revised the final regulations for discourage abuse of the provisions, by
exempted to levels which we believe are the small-volume allowance requiring equipment manufacturers to
not needed to provide adequate lead accordingly. give up more than one flexibility after
time for the Tier 4 program.67 We are also finalizing a technical Tier 4 begins for every flexibility used
hardship provision for small business prior to Tier 4. California did not
66 ‘‘Analysis of Small Volume Equipment
equipment manufacturers using 25–50 specifically recommend what the
Manufacturer Flexibilities,’’ memo from Phil
Carlson (EPA) to Docket A–2001–28. discount level should be. We are not
67 Memorandum, Phil Carlson to Docket A–2001– Flexibilities,’’ April 15, 2003. Docket A–2001–28, adopting a discount for early use of the
28, ‘‘Analysis of Equipment Manufacturer document no. II–B–24. Tier 4 flexibilities. The intent of
allowing manufacturers to use the Tier lead to additional emission reductions The early Tier 4 engine incentive
4 flexibilities early was to allow them to above and beyond those expected under program for equipment manufacturers
carry over the few remaining equipment the existing Tier 2/3 standards in the will apply to the four power categories
models that might not have been years prior to Tier 4 taking effect. above 25 horsepower where the use of
redesigned at the end of the seven-year Moreover, equipment manufacturers advanced exhaust aftertreatment is
Tier 2/Tier 3 flexibility period until Tier (and especially non-integrated expected under the Tier 4 standards.
4 begins, and not requiring a possible equipment manufacturers) are unlikely Because the Tier 4 standards for engines
double redesign in a short period of to buy early Tier 4 engines without below 25 horsepower are not expected
time. Because we have placed a some incentive to do so since these to result in the use of advanced
relatively low cap (10% under the engines are likely to be more expensive aftertreatment technologies, we are not
percent of production allowance or 100 than Tier 2/3 engines. For these reasons, including such engines in the program.
units under the small volume we are adopting new provisions that In order for an engine to be
allowance) on the amount an equipment will allow any equipment manufacturer considered an early Tier 4 compliant
manufacturer could use early from Tier to earn early compliance credits that engine, it will need to be certified to the
4, we do not believe that manufacturers could be used to increase the number of final Tier 4 standards for PM, NOX, and
will be able to abuse the program and equipment flexibilities above and NMHC (i.e., the 2013 standards for
therefore should not have to discount beyond the levels allowed under the engines between 25 and 75 horsepower,
the number of Tier 4 flexibilities used percent of production allowance or the 2014 standards for engines between
early. small-volume allowance (and for 75 and 175 horsepower, the 2014
We view this provision on early use reasons independent of those standards for engines between 175 and
of Tier 4 allowances as providing allowances: namely, an inducement to 750 horsepower, and the 2015 standards
reasonable lead time for introducing make early use of Tier 4 engines). for engines above 750 horsepower) or to
Tier 4 engines, since it should result in The program will be available to all the final PM and NMHC standards and
earlier introduction of Tier 4-compliant equipment manufacturers regardless of the alternative NOX standards during
engines (assuming that the allowances whether they are integrated or non- the phase-in (as described in section
would otherwise be fully utilized) with integrated. While Ingersoll-Rand II.A.2.c of today’s rule for engines
resulting net environmental benefit commented that the program should be between 75 and 750 horsepower). In
(notwithstanding longer utilization of available to non-integrated equipment order to be an early Tier 4 compliant
earlier Tier engines, due to the manufacturers only, we believe the engine, these engines would also have
stringency of the Tier 4 standards) and program should provide an incentive for to certify to the Tier 4 CO standards.
should do so at net reduction in cost by all equipment manufacturers to use Because 15 ppm sulfur diesel fuel will
providing cost savings for the engines early Tier 4 engines (since the benefits be available on a widespread basis in
that have used the Tier 4 allowances accruing from early use of such engines time for 2007 (due to the requirements
early. (This is another reason we see no exist regardless of whether the for on-highway heavy-duty engines), we
reason to discount the allowance.) equipment manufacturer is integrated are allowing engine manufacturers to
with the engine maker). begin certifying engines to the Tier 4
e. Early Tier 4 Engine Incentive Program Before describing this provision standards, and therefore have engines
for Equipment Manufacturers further, it is desirable to put it in eligible for the early Tier 4 engine
Ingersoll-Rand commented that non- context by explaining its relationship to incentive program, beginning with the
integrated equipment manufacturers the engine manufacturer incentive 2007 model year.
who incorporate Tier 4 compliant program for early Tier 4 or very low In order to provide assurance that
engines into their equipment prior to emission engines (described in section early Tier 4 compliant engines are
the applicable date for the Tier 4 III.M below), as well as to the similar placed into equipment earlier than
standards should be able to earn early incentive provisions for engine would otherwise happen under the Tier
compliance credits. These early manufacturers which we proposed (68 4 program, engine manufacturers will be
compliance credits could allow use of FR 28482, May 23, 2003). We are, in required to certify and start producing
the previous-tier engine (above and essence, redirecting the proposed such engines before September 1 of the
beyond the base percentage granted incentive for using early Tier 4 year prior to the post-2011 Tier 4
under the flexibility program) for up to compliant engines to equipment standards taking effect or before
18 months after the certification date of manufacturers. Thus, under today’s September 1, 2010 for engines in the
the engine. Ingersoll-Rand also rule, an engine manufacturer could use 175 to 750 horsepower category.
commented that such early compliance the incentive program (as described in Similarly, equipment manufacturers
credits should be able to be traded section III.M) only if an equipment will be required to install such engines
across power categories with manufacturer uses an early Tier 4 in equipment before January 1 of the
appropriate weightings applied. engine but (for whatever reason) year the post-2011 Tier 4 standards take
We believe a program that provides an declines to use the early engine effect or before January 1, 2011 for
incentive for equipment manufacturers flexibility allowance. In such a case, the engines in the 175 to 750 horsepower
to use early Tier 4-compliant engines is engine manufacturer could opt to earn category. In addition, in order to be
worthwhile from both a technology either ‘‘engine offsets’’ (which would considered an early Tier 4 compliant
development perspective and an allow them to make fewer engines engine, such engines would be required
environmental perspective. As we noted certified to the Tier 4 standards once the to comply with all of the requirements
at proposal when we proposed a similar Tier 4 program takes effect) or ABT associated with the final Tier 4
incentive program for engine makers, credits, but not both. In the more likely standards such as NTE requirements,
early use of Tier 4 compliant engines case of an equipment manufacturer transient testing (where otherwise
will help foster technology development using early Tier 4 engines and using the required for certification, i.e. for 25–750
by getting the Tier 4 technologies out in incentive flexibilities itself, the engine horsepower engines), and closed
the market early and provide real-world manufacturer would be eligible to crankcase requirements. Finally, for
experience to manufacturers and users generate ABT credits from such early engines certified prior to model year
(68 FR 28482, May 23, 2003). It will also Tier 4 compliant engines. 2011, the engine manufacturer would be
allowed to demonstrate early fuel is recommended (see section equipment. Equipment manufacturers
compliance with the Tier 4 standards on 1039.104(e) of the regulations). installing engines between 75 and 750
a 15 ppm sulfur fuel (as allowed under Equipment manufacturers using such horsepower that comply with the final
the certification fuel requirements pre-2011 engines in their equipment Tier 4 PM standard and the alternative
specified in section III.D of today’s rule) would likewise need to take steps to NOX standard (described in section
provided the engine manufacturer ensure that fuel meeting this low sulfur II.A.2.c) would earn one-half of a
demonstrates that the equipment in specification is used in the equipment flexibility allowance for each early Tier
which the engines are placed will use once operated in use to earn the 4 compliant engine used in its
fuel meeting this low sulfur additional flexibility allowances. equipment. Table III.B–2 presents the
specification and includes appropriate Equipment manufacturers installing requirements an engine would need to
information on the engine label and engines complying with the final Tier 4
meet to be considered an early Tier 4
ensures that ultimate purchasers of standards (as described above) would
engine for the purposes of this early Tier
equipment using these engines are earn one flexibility allowance for each
informed that ultra low-sulfur diesel early Tier 4 compliant engine used in its 4 engine incentive program.
TABLE III.B–2.—R EQUIREMENTS FOR ENGINES

[Under the Early Tier 4 Engine Incentive Program]
Number of
flexibility allow
Date before which engines must be installed by ances earned
Power category Tier 4 standards the engines must meet the equipment manufacturer for use of
early tier 4 en
gines
25 ≤ hp < 75 .............. Model Year 2013 .................................................... January 1, 2013a .................................................... 1–to–1
(19 ≤ kW < 56) ..........
75 ≤ hp < 175 ............ Model Year 2014 .................................................... January 1, 2012 ..................................................... 1–to–1
(56 ≤ kW <130) ......... Model Year 2012b .................................................. January 1, 2012 ..................................................... 0.5–to–1
175 ≤ hp ≤ 750 .......... Model Year 2014 .................................................... January 1, 2011 ..................................................... 1–to–1
(130 ≤ kW ≤ 560) ...... Model Year 2011b .................................................. January 1, 2011 ..................................................... 0.5–to–1
Generator Sets .......... Model Year 2015 .................................................... January 1, 2015 ..................................................... 1–to–1
>750 hp .....................
(>560 kW) ..................
Other Machines ......... Model Year 2015 .................................................... January 1, 2015 ..................................................... 1–to–1
>750 hp .....................
(>560 kW) ..................
a The installation date for 50 to 75 horsepower engines purchased from manufacturers choosing to opt out of the 2008 model year Tier 4
standards and instead comply with the Tier 4 standards beginning in 2012 would be January 1, 2012.
b To be eligible, engines must meet the 0.01g/bhp-hr PM standard and the alternative NO standards in section 1039.102 (e) described in sec
X
tion II.A.2.c.
As described above, equipment number of engines used prior to Tier 4 equipment manufacturers to ‘‘trade’’ the
manufacturers using early Tier 4 in each power category, the rated power additional flexibilities earned in the two
compliant engines can earn flexibility of the engines, and the type of power categories between 75 and 750
allowances that can be used to application the engines above 750 horsepower, with the power rating of
effectively increase the number of horsepower were used in) when they the engines factored into the ‘‘trade’’ to
allowances provided under the percent submit their first report under the Tier ensure equivalent emissions for the
of production allowance or the small 4 flexibility program. For engines above engines generating the early allowances
volume allowance in the same power 750 horsepower, equipment and the engines using the allowances.
category. For example, an equipment manufacturers also would be required to For example, an equipment
manufacturer that uses 500 engines in keep records of how many early Tier 4 manufacturer that earned 100 additional
the 175 to 750 horsepower category that compliant engines are used in generator flexibility allowances under the early
met the model year 2011 PM standards sets, versus how many are used in other Tier 4 engine incentive program from
and alternative NOX standards would machinery. This is because the 100 horsepower engines, could ‘‘trade’’
earn 250 additional flexibility additional flexibility allowances earned those flexibilities into the next power
allowances in that power category. That from the use of early Tier 4 compliant category up (175 to 750 horsepower).
manufacturer could then exclude 250 engines used in generator sets could The equipment manufacturer would
engines from its calculations before only be used for additional flexibility generate 10,000 horsepower-allowances
demonstrating compliance with the 80 allowances for generator sets. Likewise, from those early engines (i.e., 100
percent limit under the percent of the additional flexibility allowances horsepower times 100 allowances). The
production allowance (or the applicable earned from the use of early Tier 4 equipment manufacturer could then
limit under the small volume allowance compliant engines used in mobile produce, for this example, an additional
if the equipment manufacturer is using machinery (labeled ‘other machinery’ in 25 engines with a power rating of 400
that option) once Tier 4 starts in that the table above) applications could only horsepower above and beyond the
power category. be used for additional flexibility normal limit on allowances (or any
Equipment manufacturers would be allowances for other non-generator set other combination of engines such that
required to report certain information applications. the sum of the horsepower-weighted
regarding the early Tier 4 compliant Under the early Tier 4 engine allowances adds up to the 10,000
engines (such as engine family name, incentive program, we will allow horsepower-allowances used in this
example). We are not allowing trading economic hardship relief generally will not reasonably be expected to affect
for engines in the 25 to 75 horsepower only be accepted during the first year emissions such as a change in materials
category because the Tier 4 standards after the effective date of an applicable or a change in the company supplying
for these engines are based on the new emission standard. the components of the engine.
application of only PM aftertreatment The Agency expects this provision
will be rarely used. This expectation has 3. What Are the Recordkeeping,
technology. Similarly, we are not
been supported by our initial experience Notification, Reporting, and Labeling
allowing trading for engines in the
with the Tier 2 standards in which only Requirements Associated With the
above 750 horsepower category because
one equipment manufacturer has Equipment Manufacturer Transition
the Tier 4 standards are based on the
applied under the existing hardship Provisions?
application of PM aftertreatment to all
engines, but NOX aftertreatment for only relief provisions (and the request was The following section describes the
some engines. subsequently denied). Requests for recordkeeping, notification, reporting,
economic hardship relief will be and labeling requirement being adopted
f. Economic Hardship Relief Provision evaluated by EPA on a case-by-case today. As proposed, failure to comply
With today’s action, and as proposed, basis, and may require, as a condition of with these requirements will subject the
we are providing an additional Tier 4 granting the applications, that the noncomplying party to penalties as
transition flexibility for ‘‘economic equipment manufacturer agree (in described in 40 CFR 1068.101.
hardship relief’’ for equipment writing) to some appropriate measure to a. Recordkeeping Requirements for
manufacturers. Under the economic recover the lost environmental benefit. Engine and Equipment Manufacturers
hardship relief provisions, an Ingersoll-Rand commented that the
equipment manufacturer that does not provisions regarding eligibility for With today’s action, we are extending
make its own engines could obtain hardship relief should be revised so that the recordkeeping requirements from
limited additional relief by providing they do not require a demonstration of the current equipment manufacturer
evidence that, despite its best efforts, it severe economic hardship, noting that transition program. Under the Tier 4
cannot meet the implementation dates, such a showing would invariably transition program, engine
even with the Tier 4 equipment preclude large entities (like Ingersoll- manufacturers will be allowed to
flexibility program provisions outlined Rand) from utilizing the provision, even continue to build and sell previous tier
above. Such a situation could occur if though delays were beyond their engines needed to meet the market
an engine supplier without a major control. As described earlier in this demand created by the equipment
business interest in the equipment section, we have included an additional manufacturer flexibility program,
manufacturer were to change or drop an flexibility in the Tier 4 rule in order to provided they receive written assurance
engine model very late in the provide additional needed lead time in from the engine purchasers that such
implementation process. The purpose of appropriate, individualized engines are being procured for this
the provision is to redress individual circumstances based on a showing of purpose. Engine manufacturers will be
situations of extreme economic extreme technical or engineering required to keep copies of the written
hardship, not merely to perpetuate hardship. We believe the provisions of assurance from the engine purchasers
existing market share. That is, if the technical hardship address the for at least five full years after the final
situations arise where one equipment concerns noted by Ingersoll-Rand in year in which allowances are available
maker cannot produce equipment using their comments, and therefore we are for each power category.
Tier 4-compliant engines by the not revising the existing economic Equipment manufacturers choosing to
compliance date, but another can, hardship relief provisions (which take advantage of the Tier 4 allowances
ordinarily EPA would not adjust the require a demonstration of severe will be required to: (1) Keep records of
program to allow use of the non- economic impact) for the Tier 4 final the production of all pieces of
compliant application absent extreme, program. equipment excepted under the
compelling equitability considerations. allowance provisions for at least five
Applications for economic hardship g. Existing Inventory Allowance
full years after the final year in which
relief will have to be made in writing, The current program for nonroad allowances are available for each power
and will need to be submitted before the diesel engines includes a provision for category; (2) include in such records the
earliest date of noncompliance. The equipment manufacturers to continue to serial and model numbers and dates of
application will also have to include use engines built prior to the effective production of equipment and installed
evidence that failure to comply is not date of new standards, until the older engines, and the rated power of each
the fault of the equipment manufacturer engine inventories are depleted. It also engine, (3) calculate annually the
(such as a supply contract broken by the prohibits stockpiling of previous tier number and percentage of equipment
engine supplier), and include evidence engines. As proposed, we are extending made under these transition provisions
that serious economic hardship to the these provisions for the transition to the to verify compliance that the allowances
company will result if relief is not Tier 4 standards adopted today. We are have not been exceeded in each power
granted. (As explained in section also extending the existing provision category; and (4) make these records
III.B.2.b above, this is a significant that provides an exception to the available to EPA upon request.
difference between this economic applicable compliance regulations for
hardship provision and the technical the sale of replacement engines. In b. Notification Requirements for
hardship flexibility, where extending this provision, we are Equipment Manufacturers
consideration of cost is generally requiring that engines built to replace We are adopting new notification
irrelevant.) We expect to work with the certified engines be identical in all requirements for equipment
applicant to ensure that all other material respects to an engine of a manufacturers with the Tier 4 program.
remedies available under the flexibility previously certified configuration that is Under the Tier 4 transition program,
provisions are exhausted before granting of the same or later model year as the equipment manufacturers wishing to
additional relief (if appropriate), and engine being replaced. The term participate in the Tier 4 transition
place a limit on the period of relief to ‘‘identical in all material respects’’ provisions will be required to notify
no more than one year. Applications for allows for minor differences that would EPA prior to their use of the Tier 4
transition provisions. Equipment c. Reporting Requirements for Engine program. In addition, and also as
manufacturers will be required to and Equipment Manufacturers proposed, equipment manufacturers
submit their notification before the first As with the current program, engine will be required to apply a label to the
calendar year in which they intend to manufacturers who participate in the engine or piece of equipment that
use the transition provisions. We Tier 4 program will be required to identifies the equipment as using an
believe that prior notification will submit information each year on the engine produced under the Tier 4
greatly enhance our ability to ensure number of such engines produced and transition program for equipment
compliance. Under the newly adopted to whom the engines are provided. The manufacturers.
notification requirements, each Engine manufacturers were opposed
purpose of these submittals is to help
equipment manufacturer will be to the new labeling requirements. We
EPA monitor compliance with the
required to notify EPA in writing and believe these new labeling requirements
program and prevent abuse of the will allow EPA to easily identify the
provide the following information prior program.
to the start of the first year in which the exempted engines and equipment,
We are adopting new reporting
manufacturer intends to use the verify which equipment manufacturers
requirement for equipment are using these exceptions, and more
flexibilities: manufacturers participating in the Tier easily monitor compliance with the
(1) The nonroad equipment 4 equipment manufacturer transition transition provisions. Labeling of the
manufacturer’s name, address, and provisions. With today’s action, equipment should also help U.S.
contact person’s name, phone number; equipment manufacturers participating Customs to quickly identify equipment
(2) The allowance program that the in the program will be required to being imported using the exemptions for
nonroad equipment manufacturer submit an annual written report to EPA equipment manufacturers.
intends to use by power category; that calculates its annual number of
exempted engines under the transition 4. What Are the Requirements
(3) The calendar years in which the Associated With Use of Transition
provisions by power category in the
nonroad equipment manufacturer Provisions for Equipment Produced by
previous year. Equipment
intends to use the exception; Foreign Manufacturers?
manufacturers using the percent of
(4) An estimation of the number of production allowance, will also have to Under the current regulations in 40
engines to be exempted under the calculate the percent of production the CFR 89.2, importers are treated as
transition provisions by power category; exempted engines represented for the equipment manufacturers and are each
(5) The name and address of the appropriate year. Each report will allowed the full allowance under the
engine manufacturer from whom the include a cumulative calculation (both transition provisions in 40 CFR
equipment manufacturer intends to total number and, if appropriate, the 89.102(d). Therefore, under the current
obtain exempted engines; and percent of production) for all years the provisions, importers of equipment from
(6) Identification of the equipment equipment manufacturer is using the a foreign equipment manufacturer could
manufacturer’s prior use of Tier 2/3 transition provisions for each of the Tier as a group import more excepted
transition provisions. 4 power categories. In order to ease the equipment from that foreign
reporting burden on equipment manufacturer than 80% of that
Engine manufacturers supported the manufacturers, EPA intends to work manufacturer’s production for the U.S.
new notification requirements for with the manufacturers to develop an market (i.e., more than the percent-of-
equipment manufacturers. One electronic means for submitting production), or more than the small-
equipment company, however, information to EPA. volume allowance. Therefore, the
commented that the notification EPA had requested comment on current regulation creates a potentially
requirements are of minimal value and whether these new reporting significant adverse environmental
should be deleted. We disagree and requirements for equipment impact. EPA did not intend this
continue to believe the new notification manufacturers should also apply to the outcome, and does not believe it is
requirements will greatly enhance our current Tier 2/Tier 3 transition program, needed to provide reasonable lead time
ability to ensure compliance with the and if so, how these provisions should to foreign equipment manufacturers.
flexibility provisions. Given the limited be phased in for equipment EPA thus proposed to change the
information that must be provided by manufacturers using the current Tier 2/ current regulations to eliminate this
equipment manufacturers, we do not Tier 3 transition provisions. We did not disparity.
expect that the notifications will require receive any comments on this issue. As noted earlier, with today’s action,
any significant effort to pull the However, consistent with our approach only those nonroad equipment
information together and submit to EPA. to several other Tier 4 requirements that manufacturers that install engines and
EPA had requested comment on we were considering applying to the have primary responsibility for
whether the notification provisions Tier 2/Tier 3 transition program, we are designing and manufacturing equipment
should also apply to the current Tier 2/ not adopting reporting requirements for will qualify for the allowances or other
Tier 3 transition program, and if so, how equipment manufacturers for the relief provided under the Tier 4
these provisions should be phased in for current Tier 2/Tier 3 program. transition provisions. Foreign
equipment manufacturers using the equipment manufacturers who comply
current Tier 2/Tier 3 transition d. Labeling Requirements for Engine with the compliance related provisions
provisions. We did not receive any and Equipment Manufacturers discussed below will receive the same
comments on this issue. However, Engine manufacturers are currently allowances and other transition
consistent with our approach to several required to label their certified engines provisions as domestic manufacturers.
other Tier 4 requirements that we were with a label that contains a variety of Foreign equipment manufacturers who
considering applying to the Tier 2/Tier information. Under today’s action, as do not comply with these compliance
3 transition program, we are not proposed, we are adopting requirements related provisions will not receive
adopting such notification requirements that engine manufacturers be required to allowances. Importers that have little
for equipment manufacturers for the identify on the engine label if the engine involvement in the manufacturing and
current Tier 2/Tier 3 program. is exempted under the Tier 4 transition assembling of the equipment will not
receive any allowances or other engines imported into the U.S. We engine cost estimates from table 6.2–5 of
transition relief directly, but can import believe the bond requirements are an the final RIA, equipment using engines
exempt equipment if it is covered by an important tool to ensure that foreign exempted under the transition program
allowance or transition provision equipment manufacturers are subject to will require a bond in the amount
associated with a foreign equipment the same level of enforcement as shown in table III.B–3.
manufacturer. These provisions allow domestic equipment manufacturers.
the transition allowances and other Furthermore, we believe that a bonding TABLE III.B–3.—B OND VALUE FOR
provisions to be used by foreign requirement for the foreign equipment ENGINES IMPORTED
equipment manufacturers in the same manufacturer is an important [Under the Tier 4 Transition Program]
way as domestic equipment enforcement tool in order to ensure that

manufacturers, while avoiding the EPA has the ability to collect any Per en-
potential for importers using judgements assessed against a foreign Power range gine bond
unnecessary allowances. equipment manufacturer for violations value
(dollars)
Under today’s action, a foreign of these transition provisions.
equipment manufacturer includes any Under the bond program adopted 0 < hp < 25 ................................... 150
equipment manufacturer that produces today, a participating foreign equipment 25 ≤ hp < 75 ................................. 300
equipment outside of the United States manufacturer will have to obtain 75 ≤ hp < 175 ............................... 500
that is eventually sold in the United annually a bond in the proper amount 175 ≤ hp < 300 ............................. 1,000
States. All foreign nonroad equipment that is payable to satisfy United States 300 ≤ hp < 600 ............................. 3,000
manufacturers wishing to use the judicial judgments that results from hp ≥ 600 hp .................................. 8,000
transition provisions will have to administrative or judicial enforcement
comply with all requirements of the actions for conduct in violation of the Depending on the number of engines/
regulation discussed above including: Clean Air Act. The foreign equipment equipment brought into the U.S. each
Notification, recordkeeping, reporting manufacturer will have two options for year, the value of the bond calculated
and labeling. Along with the equipment complying with the bonding using the above values could change
requirement. The foreign equipment from year to year. Under the provisions
manufacturer’s notification described
manufacturer can: adopted today, an importer would
earlier, a foreign nonroad equipment
calculate the estimated bond amount
manufacturer will have to comply with (1) Obtain a bond in the proper amount using the values in table III.B–3 and be
various compliance related provisions from a third-party surety agent that is cited required to obtain a bond equal to the
similar to those adopted in several fuel in the U.S. Department of Treasury Circular
570, ‘‘Companies Holding Certificates of highest bond value estimated over the
regulations relating to foreign refiners.68
Authority as Acceptable Sureties on Federal seven-year flexibility period. Because
As part of the notification, the foreign
Bonds and as Acceptable Reinsuring we have the authority to bring
nonroad equipment manufacturer will
Companies’’; or enforcement actions against a
have to: (2) Obtain an EPA waiver from the bonding manufacturer for five years beyond the
(1) Agree to provide EPA with full, requirement, if the foreign equipment end of the program, the manufacturer
complete and immediate access to conduct manufacturer can show that it has assets of would be required to maintain the bond
inspections and audits; an appropriate value in the United States. for five years beyond the end of the
(2) Name an agent in the District of EPA expects the second bond option flexibility period or five years after
Columbia for service of process;
(3) Agree that any enforcement action to address instances where an using up all of its available allowances,
related to these provisions will be governed equipment manufacturer produces whichever occurs first. Finally, if a
by the Clean Air Act; equipment outside the United States foreign equipment manufacturer’s bond
(4) Submit to the substantive and containing flexibility engines, but also is used to satisfy a judgment within the
procedural laws of the United States; has facilities (and thus significant seven-year flexibility period, the foreign
(5) Agree to additional jurisdictional assets) inside the United States. Under equipment manufacturer will then be
provisions; this second option, such a manufacturer required to increase the bond to cover
(6) Agree that the foreign nonroad can apply to the EPA for a waiver of the the amount used within 90 days of the
equipment manufacturer will not seek to
detain or to impose civil or criminal bonding requirement. date the bond is used.
remedies against EPA inspectors or auditors Because EPA’s concerns of Most comments received on this issue
for actions performed within the scope of compliance will relate to the nature and supported the proposed provisions.
EPA employment related to the provisions of tier of engines used in the transition However, Ingersoll-Rand commented
this program; equipment, we believe the bond value that EPA should clarify whether the
(7) Agree that the foreign nonroad should be related to the value of the special requirements for foreign
equipment manufacturer becomes subject to engine used. Therefore, we are adopting equipment manufacturers apply to U.S.-
the full operation of the administrative and requirements that the bond be set at a based companies that have foreign
judicial enforcement powers and provisions level designed to represent manufacturing facilities. Ingersoll-Rand
of the United States without limitation based
approximately 10% of the cost of the believes that such requirements should
on sovereign immunity; and
(8) Submit all reports or other documents engine for each piece of transition not apply because EPA appears to be
in the English language, or include an equipment produced for import into the concerned about abuse of the program
English language translation. United States under this program. So by foreign companies that export
that manufacturers have certainty machines into the U.S. With today’s
In addition to these requirements, we
regarding the bond amounts and so that action, all equipment manufacturers
are adopting a new provision for foreign
there isn’t a need for extensive data who import equipment into the U.S.
equipment manufacturers that
submittals and evaluation between EPA will be required to comply with the
participate in the transition program to
and the manufacturer, the rule specifies provisions for foreign equipment
comply with a bond requirement for
the bond value for each imported engine manufacturers, even if they are U.S.-
68 See, for example, 40 CFR 80.410 concerning based on the estimated average cost for based companies. Because there is a
provisions for foreign refiners with individual a Tier 4 engine on which the bond wide range of actual presence in this
gasoline sulfur baselines. would be based. Based on average country for ‘‘U.S.-based’’ companies,
EPA believes it is important that all C. Engine and Equipment Small the Agency with an opportunity to
companies importing equipment to the Business Provisions (SBREFA) identify and explore potential ways of
U.S. comply with the requirements for The Regulatory Flexibility Act (RFA) shaping the rule to minimize the burden
foreign equipment manufacturers. generally requires an agency to prepare of the rule on small entities while
Neither the notification requirements a regulatory flexibility analysis of any achieving the rule’s purposes and being
described earlier for foreign equipment rule subject to notice and comment consistent with Clean Air Act statutory
manufacturers nor the bonding rulemaking requirements under the requirements.
requirements should cause any burden Administrative Procedure Act or any
for companies with significant presence EPA approached this process with
other statute, unless the agency certifies care and diligence. To identify
in this country. We would expect that that the rule will not have a significant
only those companies with limited representatives of small businesses for
economic impact on a substantial this process, we used the definitions
presence or no presence in this country number of small entities. Small entities
will be impacted to any measurable provided by the Small Business
include small businesses, small Administration (SBA) for manufacturers
degree because of the requirements organizations, and small governmental
placed on foreign equipment of nonroad diesel engines and vehicles.
jurisdictions. As EPA believed that the
manufacturers. The categories of small entities in the
ultimate rule could have a significant
In addition to the foreign equipment nonroad diesel sector that will
economic impact on small businesses,
manufacturer requirements discussed we prepared a regulatory flexibility potentially be affected by this
above, EPA is also requiring importers analysis as part of this rulemaking. We rulemaking are defined in the following
of exempted equipment from a prepared an Initial Regulatory table:
complying foreign equipment Flexibility Analysis (IRFA) pursuant to
manufacturer to comply with certain Defined as
section 603 of the RFA which is part of Industry small entity Major SIC
provisions. EPA believes these importer the record for the NPRM, and we codes
by SBA if:
provisions are essential to EPA’s ability prepared a Final Regulatory Flexibility
to monitor compliance with the Analysis (FRFA) to support today’s Engine manu- Less than Major Group
transition provisions. Under today’s action. facturers. 1,000 em- 35
action, each importer will be required to Under section 609(b) of the RFA, a ployees.
notify EPA prior to their initial Small Business Advocacy Review Panel Equipment
importation of equipment exempted (SBAR Panel or Panel) is required to be manufactur
under the Tier 4 transition provisions. convened prior to publication of both an ers:
Importers will be required to submit IRFA and a FRFA. Section 609(b) of the —construc- Less than Major Group
tion 750 em- 35
their notification prior to the first RFA directs the Panel to, through equip- ployees.
calendar year in which they intend to outreach with small entity ment.
import exempted equipment from a representatives (SERs), report on the —industrial Less than Major Group
complying foreign equipment comments of the SERs and make truck 750 em- 35
manufacturer under the transition findings under section 603 of the RFA manufac- ployees.
provisions. The importer’s notification on issues related to identified elements turers
will need to include the following of an IRFA during the proposal stage of (i.e., fork-
information: a rulemaking. During the development lifts).
of the rulemaking, EPA is to analyze the —all other Less than Major Group
(1) The name and address of importer (and nonroad 500 em- 35
any parent company); elements of the IRFA in developing the
equip- ployees.
(2) The name and address of the FRFA for the final rulemaking (see
ment
manufacturers of the exempted equipment section X.C of this preamble for more manufac
and engines the importer expects to import; discussion on the elements of a FRFA). turers.
(3) Number of exempted equipment the The purpose of the Panel was to gather
importer expects to import for each year information to identify impacts on small
broken down by equipment manufacturer One small engine manufacturer and 5
businesses and to develop potential
and power category; and regulatory options to mitigate these small equipment manufacturers agreed
(4) The importer’s use of the transition
concerns. At the completion of the to serve as Small Entity Representatives
provisions in prior years (number of (SERs) throughout the SBAR Panel
flexibility engines imported in a particular
SBAR Panel process, the Panel prepared
a Final Panel Report. This report process for this proposal. These
year, under what power category, and the
includes: companies represented the nonroad
names of the equipment and engine
manufacturers). • Background information on the market well, as the group of SERs
proposed rule being developed; consisted of businesses that
In addition, EPA is requiring that any • Information on the types of small manufacture various types of nonroad
importer electing to import to the entities that would be subject to the diesel equipment.
United States exempted equipment from proposed rule; The following are the provisions
a complying foreign equipment • A description of efforts made to recommended by the SBAR Panel. As
manufacturer will have to submit obtain the advice and recommendations described in section III.B above, there
annual reports to EPA. The annual of representatives of those small are other provisions that apply to all
report will have to include the number entities; and,
equipment manufacturers; however, the
of exempted equipment the importer • A summary of the comments that
actually imported to the United States discussion in this section focuses
had been received to date from those
in the previous calendar year; and the representatives. mainly on small entities.
identification of the equipment The Panel report was included in the
manufacturers and engine proposal’s rulemaking record (and
manufacturers whose exempted hence in the rulemaking record for this
equipment/engines were imported. final rule), and provided the Panel and
1. Nonroad Diesel Small Engine one year if the 2008 interim standards on meeting this standard. (Please note
Manufacturers are met, with the stipulation that small the distinction between these engines
a. Lead Time Transition Provisions for business manufacturers cannot use PM and engines in the 50–75 hp power
Small Business Engine Manufacturers credits to meet the interim standard. band, where we are conditioning a
However, if a small manufacturer elects three-year extension on meeting the
i. Panel Recommendations and Our the optional approach to the standard 2008 standards. The difference is that
Proposal (elects to skip the interim standard), no engines in the 50–75 hp category have
The transition provisions further relief will be provided. an option of whether or not to meet
recommended by the SBAR Panel for With regard to NOX— those 2008 standards. We consequently
engines produced or imported by small • There is no change in the level of have structured the small business
entities are listed below. For all of the the NOX standard for engines under 25 engine extension to encourage a choice
provisions, the Panel recommended that hp and those between 50 and 75 hp, so to comply with those standards.)
small business engine manufacturers we did not propose any special • NOX—a manufacturer may elect to
and small importers must have certified provisions for these categories. delay compliance with the standard for
engines in model year 2002 or earlier in • For engines in the 25–50 hp and the up to three years.
75–175 hp categories we proposed a For engines in the 50–75 hp category:
order to take advantage of these • As proposed, EPA is adopting
provisions. Each manufacturer would be three year delay in the program
consistent with the one-phase approach special provisions for these engines,
limited to 2,500 units per year as this reflecting the special provisions in the
number allows for some market growth. recommendation above.
rules which give engine manufacturers
The Panel recommended these ii. What We Are Finalizing the choice of meeting an interim
stipulations in order to prohibit the We are finalizing all of the provisions standard for PM in 2008 and meeting
misuse of the transition provisions as a set out above for NOX. For PM, we are the aftertreatment-based standard in
tool to enter the nonroad diesel market finalizing some of the proposed 2013, or meeting the aftertreatment
or to gain unfair market position relative provisions with certain revisions, as based standard in 2012 without meeting
to other manufacturers. described below. In finalizing these an interim standard. A small business
Currently, certified nonroad diesel provisions, we considered not only the engine manufacturer may delay
engines produced by small recommendations of the Panel, but also compliance with the 2013 Tier 4
manufacturers all have a horsepower the public comments on the proposed requirement of 0.02 g/bhp-hr PM for up
rating of 80 or less. At proposal, we small business engine manufacturer to three years provided that it complies
considered both a one-step approach, transition provisions. Extensions of an with the interim Tier 4 requirements
and the two-step approach which we are applicable standard also apply to all that begin in model year 2008 on time,
finalizing today. Due to the structure of certification requirements associated without the use of credits. We proposed
the standards and their timing, EPA with that standards (so that transient an extension of only one year, but this
proposed transition provisions for small and NTE testing would not be required would be inconsistent with the
business engine manufacturers which until expiration of the extension). Based extension period we are adopting, and
encompassed both approaches on available data, and further which we proposed, for all of the other
recommended by the Panel, with the conversations with manufacturers power categories. In addition, this
inclusion of the 2,500 unit limit (as during the development of this provision for 50–75 hp engines is
suggested by the Panel) for each rulemaking (documented in the structured to encourage small business
manufacturer. Given the two-step administrative record), we have found engine manufacturers to opt for early
structure of the final rule, we are only no small business manufacturers of PM reductions by meeting the 2008
providing those proposed provisions nonroad diesel engines above 175 hp. interim PM standard, so that an
related to that approach (a complete For engines under 25 hp: extension of three years is appropriate
description of the provisions proposed • PM—a manufacturer may elect to as an incentive. We are requiring that
by the Panel, and also by specific Panel delay compliance with the standard for these engines achieve the 2008 standard
members, is located in the SBAR Final up to three years. without use of credits to assure that
Panel Report). • NOX—there is no change in the there be improvements in actual
For a two-step approach the Panel level of the existing NOX standard for performance by engines certifying to the
recommended that: engines in this category, so no special standard. We believe that such
• An engine manufacturer should be provisions are being provided. assurance is a necessary and reasonable
allowed to skip the first phase and For engines in the 25–50 hp category: balance for the three year additional
comply on time with the second; or, • PM—manufacturers must comply lead time for meeting the aftertreatment
• A manufacturer could delay with the interim standards (the Tier 4 based standard. There were no adverse
compliance with each phase of requirements that begin in model year comments on conditioning the
standards for up to three years. 2008) on time, and may elect to delay extension in this manner.
We proposed the following provisions compliance with the 2013 Tier 4 In the alternative, a manufacturer may
in the NPRM (based on available data, requirements (0.02 g/bhp-hr PM elect to skip the interim standard
we believe that there are no small standard) for up to three years. Due to completely. However, manufacturers
manufacturers of nonroad diesel engines an oversight at proposal, we did not choosing this option will receive only
above the 75–175 hp category): include transition provisions for this one additional year for compliance with
With regard to PM— category in the NPRM, but there is no the 0.02 g/bhp-hr standard (i.e.
• Engines under 25 hp and those reason to exclude them when all other compliance in 2013, rather than 2012).
between 75 and 175 hp have only one small business engines are eligible for These engines would already have had
standard so the manufacturer could extensions. We therefore are adopting a eight years of lead time to prepare for
delay compliance with these standards three year extension with today’s action. the PM standard without any diversion
for up to three years. As engines in this category must meet of resources to meet an interim PM
• For engines between 50 and 75 hp, the 2008 standard, we are not standard, so that an extension of longer
we proposed to delay compliance for conditioning this three year extension than one year would not be appropriate,
within the meaning of section 213(b) of Horsepower with little corresponding environmental
Provision
the Act. In addition, structuring the category benefit; and further, that we should
extension in this way encourages small exclude smaller engines (those under 75
Manufacturers may hp) from further regulation in order to
engine manufacturers to choose to meet
skip the interim comply with the Regulatory Flexibility
the 2008 interim standard for PM, standard com
furthering the objective of early PM Act and fulfill the requirement of
pletely, and will re
emission reductions. ceive an additional reducing the burden on small engine
year for compli classes. As proposed, we are not
• NOX—there is no change in the adopting standards based on
ance with the 0.02
NOX standard for engines in this g/bhp-hr PM Tier 4 performance of NOX aftertreatment
category, therefore no special provisions standard (i.e. com technologies for engines under 75 hp.
are being provided. pliance in 2013, As described in more detail in section
For engines in the 75 to 175 hp rather than 2012). II of this preamble, the Summary and
75–175 hp .... NOX Manufacturers may Analysis of Comment Document, and
category:
delay compliance the RIA, we have found no factual basis
• PM—a manufacturer may elect to with the standard
supporting the assertion that standards
delay compliance with the standard for for three years.
for PM for engines between 25 and 75
up to three years. PM Manufacturers may
delay compliance hp based on use of advanced
• NOX—a manufacturer may elect to with the standard aftertreatment impose costs out of
delay compliance with the standard for for three years. relation to environmental benefit, have
up to three years. a disproportionate impact on small
These provisions are also set out b. Hardship Provisions for Small businesses, or are otherwise
below in the following table (in all Business Engine Manufacturers inappropriate. In fact, it is our finding
that these standards for PM are
instances, these engines must meet the i. Panel Recommendations and Our ‘‘appropriate’’ within the meaning of
previously applicable standards as set Proposals section 213(a)(4) of the Clean Air Act,
out in § 1039.104 (c): The Panel recommended two types of and that PM standards for these engines
hardship provisions for small business not based on performance of advanced
Horsepower engine manufacturers. These provisions
category Provision aftertreatment would be inappropriate
would allow for relief in the following as failing to reflect standards based on
<25 hp .......... NOX No special provisions cases: available treatment for these engines
are being pro • A catastrophic event, or other (taking into account costs, noise, safety,
vided. extreme unforseen circumstances, and energy factors). We received no
PM Manufacturers may beyond the control of the manufacturer adverse comments from small business
delay compliance that could not have been avoided with engine manufacturers on the proposed
with the standard reasonable discretion (i.e., fire, tornado, transition provisions for those
for three years. supplier not fulfilling contract, etc.); manufacturers.69 Accordingly, we are
NOX Manufacturers may and finalizing the small business engine
delay compliance • The event where a manufacturer manufacturer hardship provisions that
with the standard has taken all reasonable business,
for three years.
we proposed in the NPRM (as
technical, and economic steps to recommended by the Panel). We believe
25–50 hp ...... PM Manufacturers must
comply with the in
comply but cannot. that these provisions will provide
terim standards in
The Panel believed that either adequate regulatory flexibility for these
2008, and may hardship relief provision would provide manufacturers, while remaining
delay compliance lead time for up to 2 years, and that a consistent with the requirements of
with the 2013 Tier manufacturer should have to section 213(a)(4) and 213(b) of the Clean
4 requirements demonstrate to EPA’s satisfaction that Air Act.
(0.02 g/bhp-hr PM failure to sell the noncompliant engines
standard) for three would jeopardize the company’s c. Other Small Business Engine
years. solvency. EPA may also require that the Manufacturer Issues
NOX No special provisions manufacturer make up the lost i. Panel Recommendations and Our
are being pro environmental benefit. Proposals
vided.
We proposed the Panel The Panel also recommended that an
Manufacturers must
recommendations for hardship ABT program be included as part of the
comply with the in
terim Tier 4 re provisions for small business engine overall rulemaking program. In
quirements in manufacturers. While perhaps addition, the Panel suggested that EPA
2008, without the ultimately not necessary given the take comment on including specific
use of credits, and phase-in schedule discussed above, we ABT provisions for small business
may elect to delay stated that such provisions provide a engine manufacturers. We proposed an
compliance with useful safety valve in the event of
the 2013 Tier 4 re ABT program for all engine
unforeseen extreme hardship. manufacturers, with this program
quirements (0.02
g/bhp-hr PM ii. What We Are Finalizing retaining the basic structure of the
standard) for three We received two comments on the current nonroad diesel ABT program.
years We did not include small business
provisions for small business engine
50–75 hp ...... PM —OR— engine manufacturer-specific ABT
manufacturers. SBA’s Office of
Advocacy commented that the rule 69 The one comment that we received supported
would impose significant burdens on a the provisions proposed for small business engine
substantial number of small entities manufacturers.
provisions in the proposal. Discussions The Panel recommended that EPA ii. What We Are Finalizing
during the SBAR process indicated that seek comment on the total number of We are finalizing the Percent-of-
small volume manufacturers would engines and annual cap values listed Production and Small Volume
need extra time to comply due to cost above. In contrast to the Tier 2/Tier3 Allowances for all equipment
and personnel constraints, and there is rule, the SBA Office of Advocacy manufacturers, with a few changes.
little reason to believe that small expected the transition to the Tier 4 Some non-small equipment
business manufacturer specific ABT technology will be more costly and manufacturers commented that the
provisions could create an incentive to technically difficult. Therefore, the small-volume provision should enable
accelerate compliance. small business equipment manufacturers to exempt up to 700
ii. What We Are Finalizing manufacturers may need more liberal pieces of equipment over a seven-year
flexibility allowances especially for period, with no engine family
As discussed above in section III.B, equipment using the lower hp engines. restriction. As explained earlier in
we are finalizing an ABT program in The Panel’s recommended flexibility section III.B.2.c, we are finalizing
today’s action similar to that already in may not adequately address the provisions that allow manufacturers to
place for nonroad engine manufacturers. approximately 50 percent of small choose between two options: (a)
We have also made a number of changes business equipment models where the Manufacturers would be allowed to
to accommodate implementation of annual sales per model is less than 300 exempt 700 pieces of equipment over
these new emission standards. and the fixed costs are higher. Thus, the seven years, within one engine family;
2. Small Nonroad Diesel Equipment SBA Office of Advocacy and the Office or (b) manufacturers using the small-
Manufacturers of Management and Budget (OMB) volume allowance could exempt 525
Panel members recommended that machines over seven years (with a
a. Transition Provisions for Small comment be sought on implementing maximum of 150 in any given year) for
Business Equipment Manufacturers the small volume allowance (700 engine each of the three power categories below
i. Panel Recommendations and Our provision) for small business equipment 175 horsepower, and 350 machines over
Proposals manufacturers without a limit on the seven years (with a maximum of 100 in
number of engine families which could any given year) for the two power
The Panel recommended that we
be covered in any hp category. categories above 175 horsepower.
adopt the transition provisions
• Due to the changing nature of the Concurrent with the revised caps,
described below for small business
technology as the manufacturers make manufacturers could exempt engines
manufacturers and small business
the transition from Tier 2 to Tier 3 and from more than one engine family under
importers of nonroad diesel equipment.
Tier 4, the Panel recommended that the the small-volume allowance program.
These transition provisions are similar
equipment manufacturers be permitted As explained earlier, based on sales
to those in the Tier 2/3 rule (see 40 CFR
to borrow from the Tier3/Tier 4 information for small businesses, we
89.102). The recommended transition
flexibilities for use in the Tier 2/Tier 3 estimated that the alternative small-
provisions were as follows:
time frame. volume allowance program to include
• Percent-of-Production Allowance: lower caps and allow manufacturers to
Over a seven model year period, • Lastly, the Panel recommended exempt more than one engine family
equipment manufacturers may install proposing a continuation of the current would keep the total number of engines
engines not certified to the new transition provisions, without eligible for the allowance at roughly the
emission standards in an amount of modifications to the levels or nature of same overall level as the 700–unit
equipment equivalent to 80 percent of the provisions, that are available to program. The Agency believes that these
one year’s production. This is to be these manufacturers. provisions will afford manufacturers the
implemented by power category with type of transition leeway recommended
To maximize the likelihood that the
the average determined over the period by the Panel. Further, these transition
application of these provisions will
in which the flexibility is used. provisions could allow small business
result in the availability of previous Tier
• Small Volume Allowance: A engines for use by the small business equipment manufacturers to postpone
manufacturer may exceed the 80 percent equipment manufacturers, the Panel any redesign needed on low sales
allowance in seven years as described recommended that—similar to the volume or difficult equipment packages,
above, provided that the previous Tier thus saving both money and strain on
application of flexibility options that are
engine use does not exceed 700 total limited engineering staffs. Within limits,
currently in place—these provisions
over seven years, and 200 in any given small equipment manufacturers would
should be provided to all equipment
year. This is limited to one family per be able to continue to use their current
manufacturers.70
power category. Alternatively, the Panel engine/equipment configuration and
recommended, at the manufacturer’s We did in fact propose the Percent-of-
avoid out-of-cycle equipment redesign
choice by hp category, a program that Production and Small Volume
until the allowances are exhausted or
eliminates the ‘‘single family provision’’ Allowances listed above for all the time limit passes.
restriction with revised total and annual equipment manufacturers, and During the SBREFA Panel process, the
sales limits as shown below: explicitly took the Panel report into Panel discussed the possible misuse of
—For categories ≤175 hp–525 account in making that proposal. We the transition provisions by using them
previous Tier engines (over 7 years) also requested comment on a number of as a loophole to enter the nonroad diesel
with an annual cap of 150 units (these additional items, some of which were equipment market or to gain unfair
engine numbers are separate for each hp proposed by the Panel (see section III.B market position relative to other
category defined in the regulations) above). manufacturers. See 68 FR at 28481. EPA
—For categories of > 175 hp–350 was concerned that importers of
70 The Panel recognized that, similar to the Tier
previous Tier engines (over 7 years) equipment from a foreign equipment
2/3 standards, it may be necessary to provide
with an annual cap of 100 units (these transition provisions for all equipment
manufacturer could, as a group, import
engine numbers are separate for each hp manufacturers, not just for small entities, and the more exempted equipment from that
category defined in the regulations). Panel recommended that this be taken into account. foreign manufacturer than 80 percent of
that manufacturer’s production for the manufacturers, small or large, in provisions that are being adopted for all
United States market or more than the implementing the current nonroad equipment manufacturers).
small volume allowances identified in standards. In addition, we believe that EPA also received comment
the transition provisions. This would any application-specific difficulties can concerning the situation faced by small
create a potentially significant disparity be accommodated by the transition business equipment manufacturers
between the treatment of foreign and provisions the Agency is proposing using engines in the 25–50 horsepower
domestic equipment manufacturers. including ABT. range. The concern was raised that
EPA did not intend this outcome, and We are also finalizing two additional small businesses in this power grouping
did not believe it was needed to provide provisions for all equipment will face a greater relative burden in
reasonable lead time to foreign manufacturers that small business designing equipment for engines with
equipment manufacturers. The Panel equipment manufacturers may take aftertreatment, and that they may need
recognized that this was a possible advantage of. These provisions are the additional lead time beyond that
problem, and believed that a Technical Hardship Provision and the provided by the small volume
requirement that small equipment Early Tier 4 Engine Incentive Program. allowances. EPA believes that in general
manufacturers and importers must have Both provisions are discussed in greater the small volume allowances should
reported equipment sales using certified detail in sections III.B.2.b and e above. provide reasonable lead time
engines in model year 2002 or earlier in opportunity for these manufacturers, but
order to be eligible to access the b. Hardship Provisions for Small recognizes that there may be individual
transition provisions was sufficient to Business Equipment Manufacturers cases where more lead time would be
alleviate this problem. Upon further i. Panel Recommendations and Our appropriate for small business
analysis during the development of the Proposals manufacturers in this power category.
proposal, EPA decided to limit the EPA is therefore adopting a technical
The Panel also recommended that two hardship provision similar to that
availability of transition provisions to
types of hardship provisions be adopted for the percent of production
entities that install engines and have
extended to small business equipment allowance. Small business
primary responsibility for designing and
manufacturing equipment and included manufacturers. These provisions would manufacturers using engines in the 25–
such a requirement in the proposal. Id. allow for relief in the following cases: 50 hp range could petition EPA to
at 28477. Therefore, a company that • A catastrophic event, or other approve additional needed lead time in
only imported equipment, and had no extreme unforseen circumstances, appropriate, individualized
involvement in the actual beyond the control of the manufacturer circumstances, based on a showing of
manufacturing of the equipment, would that could not have been avoided with extreme technical or engineering
be ineligible to access the transition reasonable discretion (i.e., fire, tornado, hardship as provided in 40 CFR
provisions. As described in section supplier not fulfilling contract, etc.). 1039.625(m). EPA could approve
III.B.4, we are finalizing the proposed • The event where a manufacturer additional small volume allowances, up
requirements associated with the use of has taken all reasonable business, to a total number of 1100 units. This
transition provisions by foreign technical, and economic steps to total number includes the allowances
importers. Therefore, we no longer comply but cannot. In this case relief that are already available under the rule
believe it is necessary to have a separate would have to be sought before there is without request. These additional
requirement that small equipment imminent jeopardy that a allowances could only be used for
manufacturers and importers have manufacturer’s equipment could not be engines in the 25–50 horsepower range,
reported equipment sales using certified sold and a manufacturer would have to and could only be approved for
engines in model year 2002 or earlier, demonstrate to the Agency’s satisfaction qualifying small business equipment
and therefore are not finalizing this that failure to get permission to sell manufacturers. The limitations on the
redundant provision. equipment with a previous Tier engine use of small volume allowances (such as
We are also finalizing the Panel’s would create a serious economic when allowances may only be used
recommendation that equipment hardship. Hardship relief of this nature within a single engine family and the
manufacturers be allowed to borrow cannot be sought by an ‘‘integrated’’ annual limits) continue to apply to the
from Tier 4 flexibilities in the Tier2/3 manufacturer (one which also standard allowances (that are available
time frame. See the more extended manufactures the engines for its under the rule without request). Finally,
discussion on this issue in section equipment). any additional allowances granted
III.B.2.d above. We proposed that the hardship under this provision would have to be
We are not finalizing the Panel provisions recommended by the Panel used within 36 months after the
recommendation of a provision allowing be extended to small business transition flexibility period commences
small manufacturers to request limited equipment manufacturers in addition to for these engines. The additional
‘‘application specific’’ alternative the transition provisions described allowances would not be subject to the
standards for equipment configurations above. We also requested comment on annual limits noted earlier but they
which present unusually challenging the stipulation that, to be eligible for could only be used after the maximum
technical issues for compliance. We do these hardship provisions (as well as the amount of standard allowances are used
not believe that the need for such a other proposed transition provisions), in a given year (e.g., a manufacturer
provision has been established, and equipment manufacturers and importers using the 700 unit allowance would
further, it could likely provide more must have reported equipment sales have to use 200 of their standard
lead time than can be justified, and using certified engines in model year allowances for that year before they
undermine emission reductions which 2002 or earlier. could use any of the additional
are achievable. Moreover, no participant allowances granted by EPA under this
in the SBAR process or during the ii. What We Are Finalizing
technical hardship provisions).
public comment period offered any We are finalizing the Panel- EPA recognizes that it is important to
empirical support that such a problem recommended hardship provisions for facilitate the process for small business
even exists. Nor have such issues been small business equipment equipment manufacturers to seek such
demonstrated (or raised) by equipment manufacturers (which are the same approval, and intends to work with
small manufacturers so that any We received very little comment on more sulfur than this, we would adjust
transaction costs for them or for EPA our proposed certification fuel this target upward.
can be minimized. For example, EPA provisions. Detroit Diesel commented We are also adopting two options for
could consider at one time a common that we should set a maximum sulfur early use of the new 7 to 15 ppm sulfur
request from similarly situated small specification of 500 ppm for Tier 3 diesel test fuel. The first will be
business equipment manufacturers, as engines, which we are in fact doing available beginning in the 2007 model
long as all of the necessary individual beginning in model year 2008 after this year for engines employing sulfur-
information for each applicant were fuel is introduced in the nonroad sensitive technology. (Model year 2007
provided. Given that information in market, and optionally allowing as early coincides approximately with the
such an application would still be both as 2006, the earliest Tier 3 model year, introduction of 15 ppm highway fuel.)
company- and fact-specific (and likely provided manufacturers take steps to This allowance to use the new fuel in
confidential as well), and that the encourage the use of this fuel, as model years before 2011 will only be
criteria for relief as well as the scope of discussed below. available for engines which the
appropriate relief are case-specific, we Because we are lowering the upper manufacturer demonstrates will be
would necessarily evaluate and decide operated in use on fuel with 15 ppm
limit for in-use nonroad diesel fuel
whether or not to approve additional sulfur or less. Any testing that we
sulfur content to 500 ppm in 2007, and
small volume allowances on a company- perform on these engines will also use
again to 15 ppm in 2010, we are also
by-company, case-by-case basis. fuel meeting this lower sulfur
establishing new ranges of allowable
For a detailed description of the specification. This optional certification
sulfur content for testing. These are 300
comments received on small business fuel provision is intended to encourage
to 500 ppm (by weight) for model year
engine and equipment manufacturer the introduction of low-emission diesel
2008 to 2010 engines, and 7 to 15 ppm
issues, please refer to the Summary and technologies in the nonroad sector.
(by weight) for 2011 and later model
Analysis of comments, which is a part These engines will be able to use the
year engines. We believe that these
of the rulemaking record (E-DOCKET lower sulfur fuel throughout their
ranges best correspond to the fuels that operating life, given the early
number OAR–2003–0012, and legacy diesel machines will potentially see in
docket number A–2001–28). A summary availability of this fuel under the
use.71 These specifications will apply to highway program, and the assured
of the SBREFA process is located in emission testing conducted for
section X.C of this preamble. availability of this fuel for nonroad
certification, selective enforcement engines by mid-2010.
D. Certification Fuel audits, in-use, and NTE testing, as well Considering that our Tier 4 program
as any other laboratory engine testing will subject engines under 75 hp to new
It is well-established that measured for compliance purposes for engines in
emissions may be affected by the emission standards in 2008 when 15
the designated model years. Any ppm maximum sulfur fuel will be
properties of the fuel used during the compliance testing of previous model
test. For this reason, we have readily available from highway fuel
year engines will be done with the fuels pumps (and will enter the nonroad fuel
historically specified allowable ranges designated in our regulations for those
for test fuel properties such as cetane market shortly after in 2010), we believe
model years. Note that, as proposed, we it is appropriate to provide a second,
number and sulfur content. These are allowing certification with fuel
specifications are intended to represent less proscriptive, option for use of 15
meeting the 7 to 15 ppm sulfur ppm sulfur certification fuel. This
most typical fuels that are commercially specification in 2010 for under 11 hp,
available in use. This helps to ensure option will be available to any
air-cooled, hand-startable, direct manufacturers willing to take extra steps
that the emissions reductions expected injection (DI) engines certified under the to encourage the use of this fuel before
from the standards occur in use as well optional standard provision discussed it is required in the field. We are
as during emissions testing. in section II.A.3.a. allowing the early use of 15 ppm
We are establishing all 6 provisions
It is important to note that while these certification fuel for 2008–2010 engines
that we proposed related to the sulfur
specifications include the maximum under 75 hp, provided the certifying
content of fuel used in conducting
sulfur level allowed for in-use fuel, we manufacturer ensures that ultimate
nonroad diesel engine emissions testing:
believe that it is generally appropriate to purchasers of equipment using these
• 300–500 ppm for model year 2008 engines are informed that the use of fuel
to 2010 engines, test using the most typical fuels. As for
highway fuel, we expect that, under the meeting the 15 ppm specification is
• 7–15 ppm for 2011 and later model recommended, and also recommends to
year engines, 15 ppm maximum sulfur requirement,
refineries will typically produce diesel equipment manufacturers buying these
• Extension through model year 2007 engines that labels be applied at the fuel
fuel with about 7 ppm sulfur, and that
of the maximum 2000 ppm specification inlet to remind users of this
the fuel could have slightly higher
for Agency testing on pre-Tier 4 engines, recommendation. This option does not
sulfur levels after distribution. Thus, we
• 7–15 ppm for 2007–2010 model apply to those 50–75 hp engines not
expect that we will use fuel having a
year engines that use sulfur-sensitive being certified to the 0.22 g/bhp-hr PM
sulfur content between 7 and 10 ppm
technology, standard, under the manufacturers’
sulfur for our emission testing. This is
• 7–15 ppm for 2008–2010 model option discussed in section II.A.1.a.
the same as the range we indicated will
year engines under 75 hp, We believe that there may be a very
be used for heavy-duty diesel engine
• 300–500 ppm for some model year small loss of emissions benefit from any
(HDDE) engine testing in model year
2006–2007 engines at or above 100 hp. of these engines for which the operator
2007 and later (66 FR 5002, January 18,
The last 3 of these provisions are at the 2001). As with the highway fuel, should chooses to ignore the recommendation.
certifying manufacturer’s option, and we determine that the typical in-use This is because the engine manufacturer
involve additional measures that the nonroad diesel fuel has significantly will be designing the engine to comply
manufacturer must take to help ensure with the emissions standards when
that the specified fuel is used in the 71 See 66 FR 5112–5113 (January 18, 2001) where tested using 15 ppm fuel, potentially
field. The below discussion provides we adopted a similar approach to certification fuels resulting in slightly higher emissions
more detail on each of these provisions. for highway heavy-duty diesel engines (HDDEs). when it is not operated on the 15 ppm
fuel. We also believe, however, that this specification of 500 ppm sulfur conducted on engines until the 2008
is more than offset overall by the maximum could have some limited model year when the 500 ppm
encouragement this provision provides effect on the emissions control designs maximum test fuel sulfur level takes
for early use of 15 ppm fuel. We are not used on these Tier 2 and 3 engines, in effect as discussed above.
making this option available for engine that it will be slightly easier to meet the
E. Temporary In-Use Compliance
designs employing oxidation catalysts Tier 2 and 3 standards using the lower
Margins
or other sulfur-sensitive exhaust sulfur test fuel. In general, it is
emission control devices except under reasonable to set specifications of test The Tier 4 standards will be
the more restrictive provision for early fuel reflecting representative in-use challenging for diesel engine
use of 15 ppm fuel described above, fuels, and here the engines are expected manufacturers to achieve, and will
involving a demonstration by the to be using fuel with sulfur levels of 500 require manufacturers to develop and
manufacturer that the fuel will indeed ppm or lower until 2010, and 15 ppm adapt new technologies for a large
be used. Because these devices could or lower after that. In this case, any number and wide variety of engine
potentially have very high sulfur-to- impact on expected engine emissions platforms. Not only will manufacturers
sulfate conversion rates (see section from this change in test fuel for Tier 2 be responsible for ensuring that these
II.B.4 and 5 above), and because very and 3 is expected to be slight. technologies enable compliance with
high-sulfur fuels will still be available to We note that under current Tier 4 standards at the time of
some extent, we believe that allowing regulations manufacturers are already certification, they will also have to
this provision for these engines would allowed to conduct testing with ensure that these technologies continue
risk very high PM emissions until the 15 certification fuel sulfur levels as low as to be highly effective in a wide range of
ppm nonroad fuel is introduced. We are 300 ppm. The additional provision for in-use environments so that their
not making this second early 15 ppm early use of 300–500 ppm sulfur test engines will comply in use when tested
test fuel option available for engines not fuel will, however, result in any by EPA. Furthermore, for the first time,
subject to a new Tier 4 standard in 2008 compliance testing conducted by the these nonroad diesel engines will be
as these engines should already be Agency being done with fuel meeting subject to transient emissions control
designed to meet applicable standards the 300–500 ppm specification. requirements and to NTE standards.
in earlier years without need for the 15 Likewise choice of the option for early However, in the early years of a
ppm fuel. use of 15 ppm sulfur test fuel would program that introduces new
We are also adopting a similar result in any Agency testing being done technology, there are risks of in-use
provision for use of certification fuel using that fuel. However, under both of compliance problems that may not
meeting the 300–500 ppm sulfur these early certification fuel options appear in the certification process or
specification before the 2008 model involving a recommended fuel use during developmental testing. Thus, we
year. We believe certification of model provision, the Agency will not reject believe that for a limited number of
year 2006 and 2007 engines being engines from in-use testing for which model years after new standards take
designed without the use of sulfur- there is evidence or suspicion that the effect it is appropriate to adjust the
sensitive technologies to meet new Tier engine had been fueled at some time compliance levels for assessing in-use
2 or Tier 3 emission standards taking with higher sulfur fuel. compliance for diesel engines equipped
effect in those years (2006 for engines at Finally, we are extending a provision with high-efficiency exhaust emissions
or above 175 hp and 2007 for 100–175 adopted in the 1998 final rule (63 FR control devices. This provides assurance
hp engines) should be able to use this 56967, October 23, 1998). In that rule to the manufacturers that they will not
fuel, provided the certifying we set a 2000 ppm upper limit on the face recall if they exceed standards by
manufacturer is willing to take measures test fuel sulfur concentration for any a small amount during this transition to
equivalent to those discussed above to testing to be performed by the Agency clean technologies. This approach is
encourage the early use of this fuel (a on Tier 1 engines under 50 hp and Tier very similar to that taken in the light-
recommendation to the ultimate 2 engines at or above 50 hp. We did not duty highway Tier 2 final rule (65 FR
purchaser to use fuel with 500 ppm extend this provision to later model year 6796, February 10, 2000) and the
maximum sulfur and a recommendation engines at that time because we felt that highway heavy-duty rule (66 FR 5113–
to equipment manufacturers to so label more time was needed to assess trends 5114, January 18, 2001), both of which
their equipment). in fuel sulfur levels for fuels used in involve similar approaches to
The widespread availability of 500 nonroad diesels. At this time we are not introducing the new technologies. In
ppm sulfur highway fuel, the short time aware of any additional information that fact, the similarities of nonroad diesel
that these 2006 and 2007 engines could would indicate that a change in this test engines and expected Tier 4 control
use higher sulfur fuels if an operator specification is warranted. More technologies to counterpart engines and
were to ignore the recommendation, and importantly, because the fuel regulation technologies for heavy-duty highway
the eventual use of 15 ppm sulfur fuel we are adopting will make 500 ppm diesel engines led us to model the
in most of these engines for most of maximum sulfur nonroad diesel fuel proposed Tier 4 add-on provisions after
their operating lives, gives us available by mid-2007, Tier 3 engines at the 2007 heavy-duty highway diesel
confidence that this provision to or above 50 hp (which phase in program, with add-on levels chosen to
encourage early use of lower sulfur fuel beginning in 2006) will be in the field be roughly equivalent to the levels
will be beneficial to the environment for only 11⁄2 years prior to the in-use adopted in the highway rule.
overall. As with the change to 300–500 introduction of 500 ppm fuel, and Tier Comments on the proposal were
ppm cert fuel for model years 2008– 2 engines under 50 hp (which phase in received from engine manufacturers,
2010, engine manufacturers will design beginning in 2004) will be in the field requesting changes that would make the
their engines to comply based on the for at most 31⁄2 years prior to this time. temporary in-use adjustments more
test fuel specifications for certification We believe it is appropriate to avoid closely parallel the highway
and compliance testing. The change adding the unnecessary complication of requirements. Specifically, they
from a fuel specification for compliance frequent multiple changes to the test requested: (1) Providing two full model
testing that ranges up to 2000 ppm fuel specification. We are therefore years of applicability following the
sulfur for Tier 2 and 3 engines to a extending the 2000 ppm limit to testing completion of standards phase-in for the
75–175 hp category, as was proposed for changes to the in-use add-on program because the standards in the regulations
the other power categories, (2) adjusting for these engines as well. Specifically, are expressed in g/kW-hr, the
the NOX threshold for applicability of these are the extension of model year adjustments included in the regulations
the provisions to a level 8% above the applicability to 2016, two years after the are set at levels that make the resulting
split family standard, (3) adopting 3 final Tier 4 standards take effect, and adjusted in-use standard equivalent in
levels of add-ons based on how many the clarification of what PM thresholds stringency to the standards in this
hours the test engine had been used, apply for engines used in generator sets preamble (expressed in g/bhp-hr)
with cutpoints at 2000 and 3400 hours, and for other engines. adjusted by the values in Table III.E–1
and (4) a 25% upward adjustment to the Table III.E–1 shows the in-use (also expressed in g/bhp-hr).
add-on levels. We agree that these adjustments that we will apply. These Note too that, as part of the
changes would result in a closer in-use add-on levels will be applied certification demonstration,
approximation to the highway program. only to engines certified in the indicated manufacturers will still be required to
Our goal in proposing provisions model years and having FELs (or demonstrate compliance with the
somewhat different from the highway certifying to standards without FELs) at unadjusted Tier 4 certification standards
program was to avoid unnecessary or below the specified threshold levels. using deteriorated emission rates.
complexity. However, we believe that These adjustments are added to the Therefore, the manufacturer will not be
maintaining consistency with the appropriate FELs (see section III.A) or, able to use these in-use standards as the
highway program is a more important for engines certified to the standards design targets for the engine. They will
goal and the manufacturers’ suggested without the use of ABT program credits, need to project that most engines will
changes do not overly complicate the to the standards themselves, in meet the standards in-use without
program, and so we have decided to determining the in-use compliance level adjustment. The in-use adjustments will
make these changes. for a given in-use hours accumulation merely provide some assurance that
We note too that changes we are on the engine being tested. Note that the they will not be forced to recall engines
making to the Tier 4 program for PM adjustment is the same for all in-use because of some small miscalculation of
engines over 750 hp necessitate other hours accumulation. Note also that, the expected deterioration rates.
TABLE III.E–1.—A DD-ON LEVELS USED IN DETERMINING IN-USE STANDARDS

NOX PM
Engine power Model years Add-on level a For operating Add-On level b
(g/bhp-hr) hours (g/bhp-hr)
25 ≤ hp <75 .............................................................................................
(19 ≤ kW <56) .......................................................................................... 2013–2014 none 0.01
0.12 ≤ 2000
75 ≤ hp <175 ........................................................................................... 2012–2016 0.19 2001–3400 0.01
(56 ≤ kW <130) ........................................................................................ 0.25 > 3400
0.12 ≤ 2000
175 ≤ hp ≤750 .......................................................................................... 2011–2015 0.19 2001–3400 0.01
(130≤ kW ≤560) ....................................................................................... 0.25 > 3400
0.12 ≤ 2000
hp >750 .................................................................................................... 2011–2016 0.19 2001–3400 0.01
(kW >560) ................................................................................................ 0.25 > 3400
Notes:
a Applicable only to those engines certifying to standards or with FELs at or below 1.6 g/bhp-hr NO .
X
b Applicable only to those engines certifying to standards or with FELs at or below the filter-based Tier 4 PM standards (0.01 g/bhp-hr for 75–
750 hp engines, 0.02 g/bhp-hr for 25–75 hp engines and for >750 hp engines in generator sets, and 0.03 g/bhp-hr for all other >750 hp engines).
F. Test Cycles development of such a test. This NRTC cycle captures transient
development progressed steadily and emissions over much of the typical
1. Transient Test
has resulted in the creation of the nonroad engine operating range, and
In the 1998 final rule that set new Nonroad Transient Composite (NRTC) thus helps to ensure effective control of
emission standards for nonroad diesel test cycle which we are adopting in our all regulated pollutants. The speed and
engines, EPA expressed a concern that Tier 4 nonroad diesel program. The load operating schedule for EPA’s NRTC
the steady-state test cycles used to NRTC cycle supplements the existing test cycle is described in regulations at
demonstrate compliance with emission nonroad steady-state test requirements. 40 CFR 1039.505. A detailed discussion
standards did not adequately reflect Thus, most nonroad engines subject to of the transient test cycle and its
transient operation as many nonroad today’s Tier 4 standards will be required derivation is contained in chapter 4.2 of
engines are used in applications that are to certify using both of these tests.72 The the RIA for this rule.
largely transient in nature and would 72 See EPA Dear Manufacturer Letter VPCD–98–
We expect that this transient test
not therefore yield adequate control of 13, ‘‘Heavy-duty Diesel Engines Controlled by requirement will significantly reduce
emissions in use (63 FR 56984, October Onboard Computers: Guidance on Reporting and real world emissions from nonroad
23, 1998). Although we were not Evaluating Auxiliary Emission Control Devices and diesel equipment. Proper transient
prepared to adopt a transient test at that the Defeat Device Prohibition of the Clean Air Act,’’
October 15, 1998 and EPA Advisory Circular 24–
time, we announced our intention in 3, ‘‘Implementation of Requirements Prohibiting Engines.’’ A copy of both of these documents is
that final rule to move forward with the Defeat Devices for On-Highway Heavy-Duty Diesel available in EPA Air Docket A–2001–28.
operation testing captures engine TABLE III.F–1.—I MPLEMENTATION these engines’ performance with respect
emissions from the broad range of MODEL YEAR FOR NONROAD TRAN to gaseous pollutant emissions).75
engine speed and load combinations SIENT TESTING Transient testing standards do apply
that the engine may attain in-use, while with respect to PM emissions from
the steady-state emission test phase-out engines, however. The reason
Transient test
characterizes emissions at the few Power category is evident: the PM standard for phase-
implementation
isolated operating points that may be model yearsout (and phase-in) engines is based on
typical for that family of engines. performance of aftertreatment, so the
< 25 hp ............................. 2013 full complement of test cycles (NTE as
Testing for transient emissions will
25 ≤ hp < 75 ..................... 2013
likewise identify emissions which result well as transient testing) should apply.
75 ≤ hp < 175 ................... 2012
from the operation of the engine, as with 175≤ hp < 750 .................. 2011 A consequence of this is that phase-out
speed and load changes, turbocharger engines will generally be tested over the
lag, etc. transient cycle, since they must do so
In keeping with our goal to maximize In addition, any engines for which an with respect to PM emissions. We
the harmonization of emissions control engine manufacturer (see section III.M) repeat, however, that although the
programs as much as possible, we have or equipment maker (see section engines will do transient testing, only
developed this cycle in collaboration III.B.2.c) claims credit under the PM (and not gaseous pollutants) is
with nonroad engine manufacturers and incentive program for early-introduction subject to the transient test standard.
regulatory bodies, both domestic and engines will have to be certified to that In addition, manufacturers choosing
foreign, over the last several years.73 program’s standards under applicable to certify engines under 750 hp using
Further, the NRTC cycle has been Tier 4 nonroad transient and steady- alternative FEL caps during the first four
introduced as a work item for possible state duty cycles, e.g., NRTC, 8-mode years that the alternative caps are
adoption as a potential global technical and 5-mode steady-state cycles. In turn, available (see section III.A.i.2 above)
regulation under the 1998 Agreement any 2011 or later model year engine that will not be subject to the transient or
for Working Party 29 at the United uses these engine count-based credits NTE standards. However, to properly
Nations.74 will not need to demonstrate account for the transient effects when
EPA’s nonroad transient test will compliance under the NRTC cycle. calculating credits, we are requiring the
apply (with one exception noted below) Engines in any power category certified FELs of such engines to be adjusted
to a nonroad diesel engine when that to an alternate NOX standard are all upwards by applying a Temporary
engine must first show compliance with subject to the transient test requirement, Compliance Adjustment Factor
EPA’s Tier 4 PM and NOX+NMHC as they clearly will be substantially (TCAF) 76. See 40 CFR 1039.104 (g) (2).
emissions standards which are based on redesigned to achieve Tier 4 Even though we are requiring that
the performance of the advanced post- compliance, regardless of whether or NRTC testing start when the PM
combustion emissions control systems not they use high-efficiency exhaust aftertreatment-based standards take
(e.g. catalyzed-diesel particulate filters emission controls. See section II.A.1.c effect, one should not infer that the
and NOX adsorbers). This is 2011 for above. NRTC is directed at solely (or even
engines at 175 hp–750 hp, 2012 for 75– We solicited comment on whether the primarily) at PM control. In fact, we
175 hp engines (2012, as well, for 50– transient duty cycle should apply to believe that advanced NOX emission
75 hp engines made by a manufacturer NOX emissions from phase-out engines controls may be even more sensitive to
choosing the option to not comply with (68 FR 28484, May 23, 2003) and transient operation than PM filters,
the 2008 transitional PM standard.), and received comment from EMA. EMA since the PM filters ordinarily operate
2013 for engines under 75 hp. The prefers that the transient cycle only be equally effectively in all operating
transient test cycle will not apply to applicable to PM emission testing and modes, as noted earlier. It is, however,
engines greater than 750 hp. Specific not for NOX, NMHC and CO for phase- our intent that the control of emissions
provision is made for engines under 25 out engine families. They believe that during transient operation be an integral
hp for PM and under 75 hp for NOX the application of the transient NRTC part of Tier 4 engine design
(which are not based on performance of and standards could result in the need considerations. We have therefore
advanced aftertreatment). Constant- to redevelop the NOX/NMHC/CO chosen to apply the transient test
speed, variable-load engines of any emission control systems used for their requirement starting with the PM filter-
horsepower category currently certify to members’ compliance with Tier 3 based Tier 4 PM standards as these
EPA’s 5–Mode Steady State duty cycle standards. standards precede or accompany the
and are not subject to transient duty earliest Tier 4 NOX or NMHC standards
cycle testing. As with current nonroad We essentially agree with this
in all power categories except engines
diesel standards, today’s Tier 4 emission comment to the extent that phase-out
over 750 hp.
standards will apply to certification, engines do not include improvements in As EPA is not promulgating PM filter-
Selective Enforcement Audits (SEAs) gaseous pollutant emission control (i.e. based standards for engines below 25 hp
and to recall testing of equipment in-use they remain essentially Tier 3 engines in today’s rulemaking, we are likewise
for all engines subject to these for emissions other than PM). Imposing not requiring these engines to be tested
standards. new requirements with respect to these
engines’ gaseous pollutant emissions 75 Please note that this discussion does not apply
73 Letter from Jed Mandel of the Engine could divert resources inappropriately. to engines certifying to the alternative NOX phase-
Manufacturers Association to Chet France of U.S. The rule therefore states (in 40 CFR in standards, which engines are required to meet
EPA, Office of Transportation and Air Quality, 1039.102 (a)(2)) that gaseous pollutant transient and NTE requirements for gaseous
‘‘Development of appropriate transient test cycle for pollutants (as well as all other requirements that
variable speed land-based compression ignition
emissions from these engines are not would apply to phase-in engines). See discussion at
non-road engines,’’ Air Docket A–2001–28, II–B–33. subject to transient testing standards. II.A.2.c; also please note that these engines are
74 Informal Document No.2, ISO—45th GRPE, This would not apply if a manufacturer expressly not defined as phase-out engines in the
‘‘Proposal for a Charter for the Working Group on declares a new NOX+NMHC FEL for the rules; see section 1039.801 and 1039.102 (e).
76 As noted elsewhere, the TCAFs are derived
a New Test Protocol for Exhaust Emissions from engine family (since the manufacturer
Nonroad Mobile Machinery,’’ Jan. 13–17, 2003, Air identically to the Transient Adjustment Factor used
Docket A–2001–28, document II–A–171. would then already be choosing to alter in the NONROAD emissions model.
over the NRTC test cycle until model these very large displacement engines as Test, as outlined in regulations at 40
year 2013. More broadly, though we being greater than the benefit of CFR 86.1306–07.
intend for transient emissions control to gathering transient emission Transient testing requires
be an integral part of Tier 4 design measurements from them. For example, consideration of statistical parameters
considerations, we do not believe it in many instances, these engines will for verifying that test engines adequately
appropriate to mandate compliance have multiple aspiration and exhaust follow the prescribed schedule of speed
with the transient test for the engines systems requiring a test cell designed to and load values. The regulations in 40
under 50 hp which are subject to PM accommodate multiple large flow CFR 1065.514, table 1, detail these
standards in 2008. We recognize that volumes in real-time on a five Hertz, or statistical parameters, also known as
transient emission testing, though faster, basis. New transient test cycle performance statistics. These
routine in highway engine programs, requirements could require values are somewhat different than the
involves a fair amount of laboratory manufacturers to create new or comparable values for highway diesel
equipment and new expertise in the expanded testing facilities to house, engines to take into account the
nonroad engine certification process. As prepare and run transient tests on these characteristics of nonroad engine
with the transfer of advanced emission larger engines. The space requirements, operation. The values are an outgrowth
control technology itself, we believe that i.e., ‘‘footprint,’’ of such facilities could of the long development process for the
the transient test requirement should be make building them cost-prohibitive. NRTC test cycle, itself.
implemented first for larger Absent transient testing, these engines
displacement engines. These engines are 2. Cold Start Transient Testing
will still be required to certify to both
more likely to be made by steady-state and NTE test requirements. Nonroad diesel engines typically
manufacturers who provide engines to Moreover, we are modifying the operate in the field by starting and
the on-highway market and therefore certification requirements to include warming to a point of stabilized hot
have had prior on-highway engine additional information for engines operation at least once in a workday.
development and certification under 750 hp. For more detail on this Such ‘‘cold-start’’ conditions may also
experience. We do not believe that the submission, see the discussion in occur at other times over the course of
smaller engines should be the power section III.I of this preamble and 40 CFR the workday, such as after a lunch
categories first charged with 1039.205(p) of the regulations. break. We have observed that certain
implementing the new transient test, as test engines, which generally had
Finally, engines in this power
early as 2008, especially because emission-control technologies for
category are found in a relatively small
manufacturers of these engines do not meeting Tier 2 or Tier 3 standards, had
proportion of the nonroad equipment
generally make highway engines and are elevated emission levels for about 10
population and, despite the potential for
neither as experienced nor as well- minutes after starting from a cold
large quantities of emissions from this
equipped as their larger engine condition. The extent and duration of
class of engines during operation, units
manufacturer counterparts at increased cold-start emissions will
equipped with these engines have
conducting transient cycle testing. likely be affected by changing
likewise been noted to contribute a
However, to encourage earlier transient technology for meeting Tier 4 standards,
small proportion of total diesel nonroad
emission control in these engines, EPA but there is no reason to believe that this
engine emissions.77 Many of these
will allow manufacturers of engines effect will lessen. In fact, cold-start
larger-displacement engines operate
below 25 hp to submit data describing concerns are especially pronounced for
predominately in a constant-speed
emission levels for their engines over engines with catalytic devices for
fashion with few transient excursions,
the appropriate certification transient controlling exhaust emissions, because
as with electric power generation sets
duty cycle beginning in model year many require heating to a ‘‘light-off’’ or
(gen sets) which make up a significant
2008. We extend this option as well to peak-efficiency temperature to begin
percent of these larger engines. Many of
manufacturers of 25–50 hp engines, working. See, for example, RIA section
these gen sets, too, operate on an
subject to those engines meeting the 4.1.2.2 and following. EPA’s highway
intermittent or stand-by only basis.
Tier 4 transitional PM standard in 2008. engine and vehicle programs, which
Indeed, as explained below, such
Should a manufacturer choose to submit increasingly involve such catalytic
constant-speed, variable-load engines
data in the 2008–2011 time frame, prior devices, address this by specifying a test
(for example, those certifying
to required certification data procedure that first measures emissions
exclusively to the 5-mode steady-state
submissions, that transient data will not with a cold engine, then repeats the test
cycle) of any horsepower category are
be used for compliance enforcement. after the engine is warmed up,
not subject to the nonroad transient test
EPA requested comment on whether cycle. weighting emission results from the two
engines greater than 750 hp should be tests for a composite emission
Further, the Agency does not intend measurement.
subject to the transient cycle, noting
at this time to require that
concerns of technical difficulties and In the proposal, we described an
manufacturers use partial-flow sampling
cost for these engines (68 FR 28484, analytical approach that led to a
systems (PFSS) to determine PM
May 23, 2003). STAPPA–ALAPCO and weighting of 10 percent for the cold-
emissions from their engines for
other agencies representing the States’ start test and 90 percent for the hot-start
certification. A large engine
interests responded to EPA that all test. Manufacturers pointed out that
manufacturer may, however, choose to
nonroad engines should be uniformly their analysis of the same data led to a
submit PM data to the Agency using
required to test their transient weighting of about 4 percent for cold-
PFSS as an alternative test method, if
emissions. Likewise, they asked that the start testing and that a high cold-start
that manufacturer can demonstrate test
Agency not delay implementation of weighting would affect the feasibility of
equivalency using a paired-T test and F-
this particular requirement. However, at the proposed emission standards.
this time, the Agency is not adopting a 77 Memorandum from Kent Helmer to Cleophas
Manufacturers also expressed a concern
transient emission testing requirement Jackson, ‘‘Applicability EPA’s NRTC cycle to
that there would be a significant test
for engines 750 hp and over. EPA sees Nonroad Diesel Population,’’ Air Docket A–2001– burden associated with cold-start
the burden of transient cycle testing in 28, document II–B–34. testing.
Unlike steady-state tests, which amount of information available in this test cycle. The CSVL transient cycle was
always start with hot-stabilized engine area at this time, we intend to revisit the developed to approximate the speed and
operation, transient tests come closer to cold-start weighting factor for transient load operating characteristics of many
simulating actual in-use operation, in testing in the future as additional data constant-speed nonroad diesel
which engines may start operating after become available. Since the composite applications.80 It, too, would have been
only a short cool-down (hot-start) or transient test represents a combination subject to the cold-start requirement of
after an extended soak (cold-start). The of variable-speed and constant-speed nonroad transient test cycles as is the
new transient test and manufacturers’ operation, we would consider operation NRTC. However, after considerable
expected use of catalytic devices to meet from both of these types of engines in discussion with and comment from
Tier 4 emission standards make it evaluating the cold-start weighting. engine manufacturers, equipment
imperative to address cold-start Also, we intend to apply the same cold- makers and other interested parties, the
emissions in the measurement start weighting when we adopt a Agency has decided not to promulgate
procedure.78 We are therefore adopting transient duty cycle specifically for an alternative nonroad transient test
a test procedure that requires engines certified only for constant-speed cycle for constant-speed engines at this
measurement of both cold-start and hot- operation. time. EMA, in its comments on the
start emissions over the transient duty The planned data-collection effort CSVL cycle, felt generally that: (1) The
cycle, much like for highway diesel will focus on characterizing cold-start average load factor is much too low; (2)
engines. We acknowledge, however, that operation for nonroad diesel equipment. the frequency of the transient operations
limited data are available to establish an The objective will be to reassess, and if was too high; (3) the amplitudes of the
appropriate cold-start weighting. For necessary, redevelop a weighting factor transients were too great; and (4) the
this final rule, we are therefore opting that properly accounts for the degree of rates of transient load increase and
to establish a cold-start weighting of 5 cold-start operation so that in-use response were too fast.
percent. This is based on a typical engines effectively control emissions It was further noted that the CSVL test
scenario of engine operation involving during these conditions. As we move cycle is based solely upon the operation
an overnight soak and a total of seven forward with this investigation, other of a single, relatively small, naturally-
hours of operation over the course of a interested parties, including the State of aspirated arc welder engine, which
workday. Under this scenario, the 20– California, will be invited to participate. EMA claims is a variable-speed type of
minute cold-start portion constitutes 5 We are interested in pursuing a joint engine certified generally on the 8-mode
percent of total engine operation for the effort, in consultation with other test cycle. Arc welders, Cummins noted,
day. Section II.B above addresses the national government bodies, to ensure a are not much like generator sets, which
feasibility of meeting the emission robust and portable data set that will comprise around 50% of population of
standards with cold-start testing. facilitate common global technical constant-speed engines and have a very
Regarding the test burden associated regulations. This effort will require different operation and test cycle than
with cold-start testing, we believe that consideration of at least the following the typical portable generator set.
manufacturers will be able to take steps factors: Generator sets, DDC wrote, were built
to minimize the burden by taking generally for a higher power capability
• What types of equipment will we at a single speed, many having larger,
advantage of the provision that allows investigate?
for forced cooling to reduce total testing • How many units of each equipment type
less-responsive turbochargers to achieve
time (40 CFR 1039.510(c)). will we instrument? the higher brake mean effective pressure
We believe the 5-percent weighting is • How do we select individual models that (BMEP). This made it difficult for these
based on a reasonable assessment of will together provide an accurate cross- engines to shed load as quickly as the
typical in-use operation and it addresses section of the type of equipment they CSVL test cycle would require them to
the need to design engines to control represent? do. Commenters likewise wrote that the
• When will the program start and how test cycle was costly and burdensome
emissions under cold-start operation. long will it last?
We believe cold-start testing with these for equipment which, like generator
• How should we define a cold-start event sets, was only operated infrequently or
weighting factors will be sufficient to from the range of in-use operation?
require manufacturers to take steps to when emergencies occurred. Some
We expect to complete our further wrote that it would compromise
minimize emission increases under
evaluation of the cold-start weighting in generator set engine performance if
cold-start conditions. Once
the context of the 2007 Technology manufacturers had to re-engineer their
manufacturers have applied
Review, if not sooner. In case changes products to run over the CSVL test
technologies and strategies to minimize
to the regulation are necessary, this cycle, especially for larger BMEP
cold-start emissions, they will be
timing will allow enough time for engines. One commenter noted that
achieving the greatest degree of
manufacturers to adjust their designs as these changes to nonroad engines would
emission reductions achievable under
needed to meet the Tier 4 standards. carry over to other stationary
those conditions. A higher weighting
applications of these generator sets. A
factor for cold-start testing is not likely 3. Constant-Speed Tests more extensive discussion of comments
be more effective in achieving in-use The Agency proposed that engine relating to the CSVL cycle may be read
emission control as new technologies manufacturers could certify constant- in the Summary and Analysis of
will be expected to have resulted in speed engines using EPA’s Constant- Comment document for this rule.
significant control of emissions at Speed, Variable-Load (CSVL) transient Given these potential problems and
engine startup. duty cycle 79 as an alternative to the strong possibility of fixing them by
However, given our interest in certifying these engines under its NRTC 2007, the Agency has decided to defer
controlling emissions under cold-start adopting the CSVL test cycle here.
conditions and the relatively small 79 Two Memoranda from Kent Helmer to
Cleophas Jackson, ‘‘Speed and Load Operating 80 Memorandum from Kent Helmer to Cleophas
78 Note that this discussion applies only to Schedule for the Constant Speed Variable Load Jackson, ‘‘Brake-specific Emissions Impact of
engines that are subject to testing with transient test (CSVL) transient test cycle,’’ e-Docket OAR–2003– Nonroad Diesel Engine Testing Over the NRTC,
procedures. For example, this excludes constant- 0012–0993, and ‘‘CSVL Cycle Construction,’’ A– AWQ, and AW1 duty cycles,’’ Docket A–2001–28,
speed engines and all engines over 750 hp. 2001–28, II–B–50. #.
Instead, EPA with all of its stakeholders to implement it in an orderly manner. found within the nonroad equipment
in this regard will map out a process of If we encounter unforeseen and and engine population, and as
engine testing and analysis to better unavoidable delays or complications in proposed, EPA is retaining current
characterize constant-speed equipment this process, we will consider Federal steady-state test procedures for
in-use to design the most appropriate approaches to control based on available nonroad engines. (Manufacturers are
test cycle for the largest number of data at the time of the 2007 Technology thus required to meet emission
constant-speed engines. EPA undertakes Review. standards under steady-state conditions,
this process with an eye to initiating The Agency is adopting additional in addition to meeting emission
rulemaking which would lead to requirements, in conjunction with standards under the transient test cycle,
promulgation of a transient cycle for existing steady-state test requirements, whenever the transient test cycle
constant-speed engines before the which will help ensure that constant- applies.) This requirement, like NTE
Agency’s 2007 Nonroad Diesel speed nonroad diesel engines are emission testing, is one of two tests
Technical Review. subject to a rigorous program of in-use which apply to every Tier 4 engine.
EPA defines a constant-speed engine control of emissions and that diesel Table III–2 below sets out the particular
in this regard as one which is certified engine emissions will be controlled over steady-state duty cycle applicable to
to constant-speed operation, in other a wide range of speed and load each of the following categories: (1)
words, an engine which may not operate combinations. EPA is finalizing Nonroad engines 25 hp and greater; (2)
at a speed outside a single, fixed stringent nonroad NTE limits and nonroad engines less than 25 hp; and (3)
reference speed set by the engine’s related test procedures for all new nonroad engines having constant-speed,
governor. It should be clear then that nonroad diesel engines subject to the variable-load applications, (e.g., gen
any engine for which the governor Tier 4 emissions standards beginning in sets). The steady-state cycles remain,
doesn’t strictly limit the engine speed 2011 which will supplement the respectively, the 8-mode cycle, the 6-
in-use to constant-speed operation, that existing steady-state five-mode test mode cycle and the 5-mode cycle.81
engine will be subject to the NRTC. cycle for constant-speed application Steady-state test cycles are needed so
Thus, if a manufacturer’s engine is engines. NTE testing for transient that testing for certification will reflect
certified to EPA’s 8-mode steady-state operation will add further assurance the broad range of operating conditions
test, the engine would also need to that emissions from constant-speed experienced by these engines. A steady-
certify to the NRTC, since the 8-mode engines within this class, which have a state test cycle represents an important
test does not limit the engine’s fixed limited speed response in-use, are type of modern engine operation, in
operating speed. Conversely, those controlled under in-use operation. power and speed ranges that are typical
manufacturers who certify their engines Typically, engines which are designed in-use. The mid-to-high speeds and
to EPA’s constant-speed steady-state to a particular transient cycle will loads represented by present steady-
test, the 5-mode test cycle, are not control emissions effectively under state testing requirements are the speeds
required to have their engines certify to other types of transient operation not and loads at which these engines are
the NRTC. specifically included in that designed to operate for extended
By utilizing an inclusive, data-driven certification procedure. Engines that are periods for maximum efficiency and
approach (see Summary and Analysis capable of meeting emission standards durability. Details concerning the three
document for more detail), the Agency on a constant-speed, variable-load cycle steady-state procedures for nonroad
is allowing time to develop, and if will have the transient-response engines and equipment are found in
appropriate, finalize and implement a characteristics that are appropriate for regulations at 40 CFR 1039.505 and in
test procedure that meets the needs of controlling emissions at higher engine Appendices I–III to 40 CFR part 1039.
the Agency, manufacturers, and other loads and for less dynamic transient Manufacturers will perform each
parties in advance of the 2007 operation. EPA, engine manufacturers, steady-state test following all applicable
Technology Review. In fact, the Agency and interested parties will, in the mean test procedures in the regulations at 40
envisions constant speed variable load time, work to develop a more CFR part 1039, e.g., procedures for
cycle generation to be completed by July appropriate transient test for constant- engine warm-up and exhaust emissions
2005. This approach should allow the speed engines. A transient test for this measurement. The testing must be
Agency to develop a testing program broad class of nonroad engines will conducted with all emission-related
which ensures robust control in-use, is ensure a robust level of emissions engine control variables in the
data-driven and remains globally control in-use within the diverse maximum NOX-producing condition
harmonized. We expect to initiate this population of constant-speed engines which could be encountered for a 30
effort within 3 months of promulgation and equipment. second or longer averaging period at a
of this rule and to conclude the work on given test point. Table III.F–2 below
4. Steady-State Tests
the new test cycle in enough time to summarizes the steady-state testing
promulgate it through rulemaking and Recognizing the variety of both power requirements by individual engine
to provide industry adequate lead time classes and work applications to be power categories.
TABLE III.F–2.—S UMMARY OF STEADY-STATE TEST REQUIREMENTS

Steady-state testing requirements
Nonroad engine power classes
8-Mode cycle (C1 weighting) 6-Mode cycle (G3 weighting) 5-Mode cycle (D2 weighting)
hp < 25 (kW < 19) .................................................... applies a ............................... applies a ............................... applies b
25 ≤ hp < 75 (19 ≤ kW < 56) ................................... applies .................................. NA c ...................................... applies b
75 ≤ hp < 175 (56 ≤ kW < 130) ............................... applies .................................. NA c ...................................... applies c
81 These three steady-state test cycles are similar

ISO 8178–4:1996 (E) and remain consistent with the
existing 40 CFR part 89 steady-state duty cycles.
to test cycles found in the International Standard
TABLE III.F–2.—S UMMARY OF STEADY-STATE TEST REQUIREMENTS—Continued

Steady-state testing requirements
Nonroad engine power classes
8-Mode cycle (C1 weighting) 6-Mode cycle (G3 weighting) 5-Mode cycle (D2 weighting)
175 ≤ hp ≤ 750 (130 ≤ kW ≤ 560) ........................... applies .................................. NA c ...................................... applies b

hp > 750 (kW > 560) ................................................ applies .................................. NA c ...................................... applies b
a Manufacturers may use either of these tests for this class of engines.
b For constant, or nearly constant, speed engines and equipment with variable, or intermittent, load.
c Testing procedures not applicable to this class of engines.
Nonroad engine manufacturers 82, test burden of diesel engine dynamometer to operate a particular
have called for steady-state testing manufacturers. Rather, the RMC engine. Finally, statistical targets serve
which would collect emissions versions of EPA’s steady-state test cycles to increase repeatability and reduce
continuously ‘‘in a pseudo-transient allow for more consistent and variability of engine operating
manner,’’ proposing in effect, one-filter predictable emission testing of emission parameters and emission test results on
PM collections during a steady-state control system hardware-equipped a test-to-test basis.
duty cycle. In response to these and diesel engines. Eliminating the Transport refrigeration unit (TRU)
other manufacturer concerns for ‘‘downtime’’ between modes for the engines, a specific application of a
emission variability during certification emission collection equipment allows steady-state operation engine (68 FR
testing due to unanticipated emission sampling of emissions to be done on a 28485, May 23, 2003), will be subject to
control system regeneration between composite basis for the whole test as both steady-state and NTE standards
steady-state test modes, the Agency 83 opposed to sampling emissions mode- based on any normal operation that
has adopted, in its 40 CFR 1065.515 by-mode. The RMC versions of these these engines would experience in the
regulations, the concept of modifying tests simply create a negligible field. To that end, EPA has adopted a
EPA’s 40 CFR part 89 steady-state transition period 20 seconds long four-mode steady-state test cycle
engine certification duty cycles. The connecting each mode and collects designed specifically for engines used in
section describes ramped ‘‘modal’’ emissions during these brief transitions, TRU applications which may be used by
steady-state certification tests which as well as collecting emissions during the manufacturer in lieu of normal
would link the modes of a steady-state the running of each test’s discrete steady-state testing. Commenters to the
test together for the purpose of operating modes. The continuous rule agreed that a TRU test cycle would
collecting a continuous stream of engine emission sampling allows regeneration be more representative of refrigeration
emissions. These tests provide for events from engine emission control unit operation than the nonroad cycles
operating an engine at all of the modes hardware to be captured more reliably currently available to manufacturers of
specified in the present steady-state and repeatably. By running emission TRU engines, but some took issue with
nonroad test cycles but without the testing without breaks and over the EPA’s usage restrictions in paragraphs
breaks in emission collection required same engine duty schedule for each (d)(2), (e)(2), and (e)(3) of regulations
by switching between modes, stabilizing repetition of a RMC test, regeneration proposed at 40 CFR part 1039 subpart G.
engine operation, and collecting within the engine’s emission control In response, the final rule allows
emissions at that next operating mode. hardware should become almost a manufacturers to test their engines
Since a ramped modal cycle (RMC) test predictable event. The longer sampling under a broad definition of intermediate
cycle may more reliably and test speed. The definition covers the 60–
times of RMCs, while creating an
consistently report engine emissions 75% range of engine rpm at the
identical weighting of each mode’s
from particulate trap and other emission specified test cycle engine load points,
emissions, also help to avoid collecting
control hardware-equipped nonroad as defined in 40 CFR, 89.2. This will
a minuscule, possibly unreliably
engines than the comparable steady- enable an engine manufacturer to more
measured, amount of sample over the
state duty cycle from which it was closely match the TRU cycle to the
course of any single operating mode. PM
derived, the Agency is providing the operation of their engines in-use.
emissions, for example, can be collected
option of using these RMC versions of Further, the engine is allowed to exhibit
and measured more precisely under
its steady-state engine duty cycles for
these test conditions as either batch or no more than 2% variation in transient
nonroad diesel engine certification
continuous samples. The opportunities operation (speed or torque change)
testing in lieu of the otherwise
for loss of emissions during sampling around the four operating modes
applicable steady-state cycles. Details
and storage due to sample retention by defined under this test cycle. The
on the procedures may be found in
equipment at shut-down between modes provisions to address load set point drift
chapter 4.2 of the RIA for this rule and
or by filter handling and weighing are are discussed in detail in the RIA
at regulations at 40 CFR 1039.505 and
greatly reduced. As well, running a chapter 4.3.2 and in regulations at 40
Appendix I of part 1039.
The optional RMC duty cycles do not ‘‘steady-state’’ test on a continuous basis CFR part 1039 subpart G.
represent a relaxation in stringency of allows cycle performance statistics to be In choosing to certify their engine as
emission testing nor are they an applied to RMC emission tests (see 40 a TRU engine, manufacturers will need
unreasonable increase in the emission CFR, part 39). Manufacturers are to state on the engine emission control
familiar with test cycles run with a set label that the engine will only be used
82 Letter from EMA (Engine Manufacturers of statistical engine duty cycle in a TRU application and records must
Association) to EPA Air Docket A–2001–28, IV–D– performance ‘‘targets’’. Further, their be kept on the delivery destination(s) for
402, pp 64. test runs will be subject to less test cell their engines. Manufacturers of these
83 Memorandum and summary of technical
discussions (including Appendix ‘‘A’’ text) in the

‘‘tuning’’, modifying control strategies engines may petition EPA at
e-Docket submission, OAR–2003–0012–0028, to using repeat testing runs to fit the certification for a waiver of the
EPA’s Air Docket. emission test cycle and the requirement to provide smoke emission
data for their constant-torque engines. A as well as improved smoke testing However, in past discussions, some
more detailed discussion of the TRU standards and procedures. Engines manufacturers have indicated that it is
associated provisions is contained in below 19 kilowatts (kW) will generally possible for the maximum test speed to
chapter 4.2 of the RIA. It should be not have particulate filters, but most of be unrepresentative of in-use operation.
noted that an RMC version of the steady these are constant-speed engines and are Since we were aware of this potential
state TRU duty cycle is provided in therefore not subject to smoke during the original development of this
Table 2 of 40 CFR part 1039 subpart G. standards, as described below. definition, we included provisions to
We are continuing the established address issues such as these. Part 1065
G. Other Test Procedure Issues policy of exempting constant-speed allows EPA to modify test procedures in
This section contains further detail engines and single-cylinder engines situations where the specified test
and explanation regarding several from smoke standards. We do not procedures would otherwise be
related nonroad diesel engine emissions believe that constant-speed engines unrepresentative of in-use operation.
test and measurement provisions. The undergo the kind of acceleration or Thus, in cases in which the definition
test procedures are specified in 40 CFR lugging events that occur during this of maximum test speed resulted in an
part 1065 and part 1039 subpart F. Part smoke test procedure, so it would not be engine speed that was not expected to
1065 contains general test procedure appropriate for these engines to be occur with in-use engines, we would
requirements and part 1039 contains the subject to smoke standards. We exempt work with the manufacturers to
provisions that are specific to CI single-cylinder engines for a different determine the maximum speed that
nonroad engines, such as test cycles. reason. These engines, which very often would be expected to occur in-use (see
The changes described here will not provide power for generator sets and regulations at 40 CFR 1065.10 (c)).
significantly affect the stringency of the other constant-speed applications, but
standards. While some of the changes may in some cases experience 3. Improvements to the Test Procedures
being made may appear to increase the accelerations, the nature of single- As we proposed, we are making
stringency of the standards when cylinder engine operation makes it changes to the test procedures to
considered by themselves, others would difficult to get a valid smoke emission improve the precision of emission
appear to have the opposite effect. measurement. Single-cylinder engines measurements. These changes address
When considered together, however, generally have discrete puffs of smoke, the potential effect of measurement
they will result in more repeatable and rather than a stable emission stream for precision on the feasibility of the
less subjective testing that is equivalent measuring smoke values. We believe it standards. It is important to note that
to the existing procedures with respect is not appropriate to use such erratic these changes are not intended to bias
to stringency. measurements to evaluate an engine’s results high or low, but only to improve
emission performance. As a result, we the precision of the measurements.
1. Smoke Testing
will not require single-cylinder engines Based on our experience with these
To control smoke emissions, we are to meet our smoke standards until we modified test procedures, and our
requiring in this final rule that the find a test method that takes this into discussions with manufacturers about
current smoke standards and procedures account. their experiences, we are confident that
will continue to apply to certain Also, as described in the proposed these changes will not affect the
engines. We proposed to change these rule, we are exempting from smoke stringency of the standards. These
smoke standards and procedures, based emission standards any engines that are changes are summarized briefly here.
on recent developments toward an certified to PM emission standards or The rationale for the changes are
established international protocol that FELs at or below 0.07 g/kW-hr. We discussed in detail elsewhere. The
was designed to allow a straightforward believe any engine that has such low changes affecting Constant Volume
method to test engines in the field (68 PM emissions will have inherently low Sampling (CVS) and PM testing are
FR 28486, May 23, 2003). We have smoke emissions. No commenters discussed in a memo to the docket (Air
chosen not to adopt the proposed disagreed with this position. Docket A–99–06, IV–B–11), which was
approach, mainly because it is becoming originally submitted in support of the
increasingly clear that ongoing 2. Maximum Test Speed
recent highway heavy-duty diesel
development of in-use testing We are changing how test cycles are engine rule (66 FR 5001, January 18,
equipment will allow direct specified. As proposed, we are applying 2001).
measurement of PM emissions in the the existing definition of maximum test In general, we are applying the
field. We believe this will provide the speed in 40 CFR part 1065 to nonroad highway heavy-duty engine test
best long-term control of both PM CI engines. This definition of maximum procedures to nonroad CI engines in this
emissions. Controlling smoke is in some test speed is the single point on an rulemaking. Many of the specific
ways independent of PM, but the engine’s normalized maximum power changes being adopted are to the PM
interest in developing an in-use smoke versus speed curve that lies farthest sampling procedures. The PM
test was primarily as a means of away from the zero-power, zero-speed procedures are the procedures finalized
providing a secondary indicator of high point. This is intended to ensure that as part of the highway heavy-duty diesel
in-use PM emissions from these engines. the maximum speed of the test is engine rule (66 FR 5001, January 18,
Direct PM measurement removes much representative of actual engine operating 2001). These include changes to the
of the advantage of in-use smoke characteristics and is not improperly type of PM filters that are used and
measurements. Relying on the existing used to influence the parameters under improvements in how PM filters are
smoke test also addresses concerns which their engines are certified. In weighed before and after emission
raised by manufacturers that the effort establishing this definition of maximum measurements, including requirements
to comply with the new smoke test speed, it was our intent to specify for more precise microbalances.
requirements would be a large testing the highest speed at which the engine is It is also worth noting that we intend
and development burden with little air- likely to be operated in use. Under to make additional improvements to the
quality benefit. We believe that normal circumstances this maximum test procedures in a separate rulemaking
aftertreatment-based Tier 4 PM test speed should be close to the speed that will be proposed later this year to
standards will control smoke emissions at which peak power is achieved. incorporate the latest measurement
technologies. Many of the certify an engine family, because For example, for engines that use
improvements being considered were certification typically occurs before emission credits, this could occur if a
discussed in the previously-mentioned production begins. Therefore the manufacturer deliberately biased its
memo to the docket (Air Docket A–99– definition of ‘‘maximum engine power’’ production variability so that the
06, IV–B–11). We recognize the being finalized today relies primarily engines have higher average power than
importance of these improvements for upon the manufacturer’s design described in the application. If we
use in testing by nonroad diesel engine specifications and the maximum torque voided the certificate for those engines
manufacturers and EPA. However, since curve that the manufacturer expects to the manufacturer would be subject to
we expect that the changes would also represent the actual production engines. large fines and any other appropriate
apply to many nonroad spark-ignition This provision is specified in a new enforcement provisions for each engine.
engine manufacturers, it is appropriate section 40 CFR 1039.140. Under this Finally, in light of some of the
to conduct a separate notice and approach the manufacturer would take comments that we received, it is worth
comment rulemaking for all affected the torque curve that is projected for an clarifying that the maximum engine
parties. We remain committed to engine configuration, based on the power will not be used during engine
incorporating appropriate additional manufacturer’s design and production testing. It is only used to define power
improvements to the test procedures. specifications, and convert it into a categories and calculate ABT emission
We have placed into the docket a draft ‘‘nominal power curve’’ that would credits.
revised version of part 1065 that relate the maximum power that would
represents our current thinking on be expected to engine speed when a I. Auxiliary Emission Control Devices
appropriate testing regulations. production engine is mapped according and Defeat Devices
our specified mapping procedures. The Existing nonroad regulations prohibit
H. Engine Power the use of a defeat device (see 40 CFR
maximum engine power is being
Currently, rated power and power defined as the maximum power point 89.107) in nonroad diesel engines. The
rating are undefined, and we are on that nominal power curve. defeat device prohibition is intended to
concerned that this makes the Manufacturers will be required to ensure that engine manufacturers do not
applicability of the standards too report the maximum engine power of use auxiliary emission control devices
subjective and confusing. One each configuration in their applications (AECD) which sense engine operation in
manufacturer may choose to define for certification. As with other engine a regulatory test procedure and as a
rated power as the maximum measured parameters, manufacturers will be result reduce the emission control
power output, while another may define required to ensure that the engines that effectiveness of that procedure.84 In
it as the maximum measured power at they produce under the certificate have today’s notice we are supplementing
a specific engine speed. Using this maximum engine power consistent with existing nonroad test procedures with a
second approach, an engine’s rated those described in their applications. transient engine test cycle and NTE
power may be somewhat less than the However, since we recognize that emission standards with associated test
true maximum power output of the variability is a normal part of engine requirements. As such, the Agency
engine. Given the importance of engine production, we will not require that all believes that a clarification of the
power in defining which standards an production engines have exactly the existing nonroad diesel engine
engine must meet and when, we believe power specified in the application. regulations regarding defeat devices is
that it is critical that a singular power Instead, we will only require that the required in light of these additional
value be determined objectively power specified in the application be emission test requirements. The defeat
according to a specific regulatory within the normal range of powers of device prohibition makes it clear that
definition. the production engines. Typically, we AECDs which reduce the effectiveness
To address this, we proposed to add would expect the specified power to be of the emission control system are
a definition of ‘‘maximum engine within one standard deviation of the defeat devices, unless one of several
power’’ to the regulations. This term mean power of the production engines. conditions is met. One of these
was to be used instead of previously If a manufacturer determines that the conditions is that an AECD which
undefined terms such as ‘‘rated power’’ specified power is outside of the normal operates under conditions ‘‘included in
or ‘‘power rating’’ to specify the range, we may require the manufacturer the test procedure’’ is not a defeat
applicability of the standards. The to change the settings of the engines device.85 While the existing defeat
addition of this definition was intended being produced and/or amend the device definition does contain the term
to allow for more objective applicability application for certification. In deciding ‘‘test procedure,’’ and therefore should
of the standards. More specifically, we whether to require such amendment, we be interpreted as including the
proposed that: would consider the degree to which the supplemental testing requirements, we
Maximum engine power means the
specified power differed from the want to make it clear that both the
measured maximum brake power output of production engines, the normal power supplemental transient test cycle and
an engine. The maximum engine power of an variability for those engines, whether NTE emission test procedures are
engine configuration is the average maximum the engine used or generated emission
engine power of the engines within the credits, and whether the error affected 84 Auxiliary emission control device is defined at
configuration. The maximum engine power which standards applied to the engine. 40 CFR 89.2 as ‘‘any element of design that senses
of an engine family is the highest maximum The preceding discussion presumes temperature, vehicle speed, engine RPM,
engine power of the engines within the that each manufacturer will develop its transmission gear, or any other parameter for the
family. production processes to produce the purpose of activating, modulating, delaying or
deactivating the operation of any part of the
During the comment period, engines described in the application. If emission control system.’’
manufacturers opposed the proposed a manufacturer were to intentionally 85 40 CFR 89.107(b)(1) states ‘‘Defeat device
definition. (We received no other produce engines different than those includes any auxiliary emission control device
comments on this issue.) The described in the application, we would (AECD) that reduces the effectiveness of the
emission control system under conditions which
manufacturers correctly pointed out that consider the application to be may reasonably be expected to be encountered in
they cannot know the average actual fraudulent, and could void the normal operation and use unless such conditions
power of production engines when they certificate ab initio for those engines. are included in the test procedure.’’
included within the defeat device state test cycle and that which is regulations by specifying what type of
regulations as conditions under which predominately associated with transient information manufacturers must submit
an operational AECD will not be operation;86 regarding AECDs.
considered a defeat device. Therefore, E. A comparative analysis of the base Finally, we take this opportunity to
we are clarifying the defeat device emissions control maps from certified emphasize that the information
regulations by specifying the engines rated at or below 750 submitted must be specific to each
appropriate test procedures (i.e., the horsepower and those rated over 750 engine family. The practice of
existing steady-state procedures and the horsepower. describing AECDs in a ‘‘common’’
supplemental tests). We are clarifying We will use this information to section, wherein the strategies are
the engine manufacturers certification determine the degree to which the described in general for all the
reporting requirements with respect to design and effectiveness of the transient manufacturer’s engines, is acceptable as
the description of AECDs. Under the emissions control system compares to long as each engine family’s application
previous nonroad engine regulations, the control demonstrated over the contains specific references to the
manufacturers are required to provide a steady-state cycle as well as the AECDs in the common section which
generalized description of how the transient control used for certified clearly indicate which AECDs are
emissions control system operates and a engines at or below 750 horsepower present on that engine family, and the
‘‘detailed’’ description of each AECD where compliance over the transient application contains specific calibration
installed on the engine (see 40 CFR cycle is required. information for that engine family’s
89.115(d)(2)). This change clarifies what A thorough disclosure of the presence AECDs. The regulatory requirements
is meant by ‘‘detailed.’’ and purpose of AECDs is essential in can be found at 40 CFR 89.115(d)(2) in
For engines rated above 750 allowing EPA to evaluate the AECD and today’s notice.
horsepower, the expanded determine whether it represents a defeat
J. Not-To-Exceed Requirements
interpretation of ‘‘included in the test device. Clearly, any AECD which is not
cycle’’ extends only to the NTE because fully identified in the manufacturer’s In today’s action we are finalizing not-
we are not requiring these engine to be application for certification cannot be to-exceed (NTE) emission standards for
tested over the supplemental transient appropriately evaluated by EPA and all new nonroad diesel engines subject
test cycle. Transient emissions control therefore cannot be determined to be to the Tier 4 emissions standards
strategies that are substantially included acceptable by EPA. Our clarifications to beginning in 2011. These NTE standards
in the NTE will be considered to comply the certification application and requirements are largely identical to
with the defeat device criteria. For requirements include additional detail the NTE provisions we proposed, except
instances where transient emissions specific to those AECDs which the as noted below.
control strategies are not well manufacturer believes are necessary to The NTE standards and test
represented over the official test protect the engine or the equipment in procedures are being finalized to help
requirements, we will rely on the defeat which it is installed against damage or ensure that nonroad diesel emissions
device provisions to ensure appropriate accident (‘‘engine protection’’ AECDs). are controlled over the wide range of
transient off-cycle emissions control. While the definition of a defeat device speed and load combinations commonly
The defeat device provisions restrict the allows as an exception strategies needed experienced in-use. EPA has similar
ability of manufacturers to reduce the to protect the engine and equipment NTE standards for highway heavy-duty
level of emissions control during against damage or accident, we intend diesel engines, compression ignition
transient operation compared to that to continue our policy of closely marine engines, and nonroad spark-
employed over the steady state cycle. In reviewing the use of this exception. In ignition engines. The NTE requirements
order to evaluate transient emissions supplement the existing steady-state test
evaluating whether a reduction in
control strategies for compliance with as well as the new transient test which
emissions control effectiveness is
the defeat device provisions, we are is also being finalized today.
needed for engine protection, EPA will
requiring manufacturers to submit The NTE standards and test
closely evaluate the actual technology
information which indicates how procedures which we proposed, and
employed on the engine family, as well
transient emissions are controlled which we are finalizing, are derived
as the use and availability of other
during normal operation and use. from similar NTE standards and test
emission control technologies across the
Information that would adequately procedures which EPA adopted for
industry, taking into consideration how
fulfill this requirement includes but is highway heavy-duty diesel engines. In
widespread the use is, including its use
not limited to: the proposal, we requested comment on
in similar engines and similar
A. Emissions data gathered with an alternative NTE test procedure
equipment. While we have specified
portable emissions measurement approach (see 68 FR 28369, May 23,
additional information related to engine
systems from in-service engines 2003). As discussed in the proposal, the
protection AECDs in the regulations, we
operating over a broad range of typical two NTE approaches would result in the
reserve the right to request additional
transient conditions; same overall level of emission control,
information on a case-by-case basis as
B. Emissions data generated under but the implementation of each
necessary.
laboratory conditions representing a In the last several years, EPA has approach from an in-use measurement
broad range of typical transient issued extensive guidance on the and data gathering perspective are quite
operation; disclosure of AECDs for both highway different. We have decided not to
C. Transient test cycle results from and nonroad diesel engine finalize this alternative approach. This
certified engines rated at or below 750 manufactures. These provisions do not decision is based primarily on our belief
horsepower which share nearly impose any new certification burden on that nonroad engine manufacturers will
identical transient emissions control engine manufacturers, rather, it clarifies more easily transfer the knowledge and
strategies; the existing certification application experience gained from the highway
D. Base emissions control maps along NTE implementation (which begins in
with an explanation for differences in 86 Base emissions control maps describe the 2007) to the nonroad program if the two
control between portions of the map modulation of an emissions control parameter as a programs have similar requirements. For
substantially included in the steady- function of changing engine speed and torque. additional discussion regarding our
decision to not finalize the alternative The NTE requirements establish an exceed a specified value for any of the
approach, please see the Summary and area (the ‘‘NTE zone’’ or ‘‘NTE control regulated pollutants.87 An illustrative
Analysis of Comments. area’’) under the torque curve of an NTE zone is shown in Figure III.J–1.
engine where emissions must not
The NTE standard applies during any The NTE standard applies to engines at The NTE test procedure can be run in
conditions that could reasonably be the time of certification as well as in use nonroad equipment during field
expected to be seen by that engine in throughout the useful life of the engine. operation or in an emissions testing
normal operation and use, within laboratory using an appropriate
certain broad ranges of real ambient TABLE III.J–1.—NTE S TANDARD dynamometer. The test itself does not
conditions. The NTE requirements will IMPLEMENTATION SCHEDULE involve a specific operating cycle of any
help to ensure emission benefits over specific length; rather, it involves
the full range of in-use operating NTE imple nonroad equipment operation of any
conditions. The NTE being finalized Power category mentation type which could reasonably be
today for nonroad contains the same model year a expected to occur in normal nonroad
basic provisions as the highway NTE. equipment operation that could occur
<25 hp ...................................... 2013
This NTE control area is defined in the within the bounds of the NTE control
25–75 hp ................................... 2013 b
same manner as the highway NTE area. The nonroad engine is operated
75–175 hp ................................. 2012
control area, and is therefore a subset of under conditions that may reasonably
175–750 hp ............................... 2011
the engine’s possible speed and load >750 hp .................................... 2011
be expected to be encountered in
operating range. The NTE standard normal operation and use, including
applies to emissions sampled during a Notes: operation under steady-state or transient
a The NTE applies for each power category
time duration as small as 30 seconds. conditions and under varying ambient
The NTE standard requirements for once Tier 4 standards are implemented, such conditions. Emissions are averaged over
that all engines in a given power category are
nonroad diesel engines are summarized required to meet NTE standards. a minimum time of thirty seconds and
below and specified in the regulations at b The NTE standard would apply in 2012 for then compared to the applicable
40 CFR 1039.101 and 40 CFR 1039.515. any engines in the 50–75 hp range which emission standard. The NTE standard
These requirements will take effect as choose not to comply with the proposed 2008 applies over a wide range of ambient
transitional PM standard.
early as 2011, as shown in table III.J–1. conditions, including up to an altitude
87 Torque is a measure of rotational force. The of Federal Regulations. The intent of the mapping merely a graphical representation of the maximum
torque curve for an engine is determined by an procedure is to determine the maximum available torque across all engine speeds.
engine ‘‘mapping’’ procedure specified in the Code torque at all engine speeds. The torque curve is
of 5,500 feet above-sea level at ambient manufacturer has relevant in-use application(s), is not capable of
temperatures as high as 86 deg. F, and nonroad emissions test data, it should operating in such regions. We have also
at sea-level up to ambient temperatures be taken into consideration by the finalized a provision which would
as high as 100 deg. F. The specific manufacturer in developing the basis for allow a manufacturer to petition the
temperature and altitude conditions its statement. Agency to limit testing in a defined
under which the NTE applies, as well as In addition, as we proposed, we are region of the NTE engine control zone
the methodology for correcting finalizing a transition period during during NTE testing. This optional
emissions results for temperature and/or which a manufacturer could apply for provision would require the
humidity, are specified in the an NTE deficiency for a nonroad diesel manufacturer to provide the Agency
regulations. engine family. The NTE deficiency with in-use operation data which the
For new nonroad diesel engines provisions would allow the manufacturer could use to define a
subject to the NTE standards, we will Administrator to accept a nonroad single, continuous region of the NTE
require that manufacturers state in their diesel engine as compliant with the NTE control zone. This single area of the
application for certification that they are standards even though some specific control zone must be specified such that
able to meet the NTE standards under requirements are not fully met. We are operation within the defined region
all conditions that may reasonably be finalizing these NTE deficiency accounts for 5 percent or less of the total
expected to occur in normal equipment provisions because we believe that, in-use operation of the engine, based on
operation and use. Manufacturers will despite the best efforts of manufacturers, the supplied data. Further, to protect
have to maintain a detailed description for the first few model years it is against ‘‘gaming’’ by manufacturers, the
of any testing, engineering analysis, and possible some manufacturers may have defined region must generally be
other information that forms the basis technical problems that are limited in elliptical or rectangular in shape, and
for their statement. We believe that nature but cannot be remedied in time share a boundary with the NTE control
there is a variety of information that a to meet production schedules. We are zone. If approved by EPA, the
manufacturer could use as a reasonable not limiting the number of NTE regulations then disallow testing with
basis for a statement that engines are deficiencies a manufacturer can apply sampling periods in which operation
expected to meet NTE standards. For for during the first three model years for within the defined region constitutes
example, a reasonable basis could which the NTE applies. For the fourth more than 5.0 percent of the time-
include data from laboratory steady- through the seventh model year after weighted operation within the sampling
state and transient test cycle operation, which the NTE standards are period.
a robust engine emissions map derived implemented, a manufacturer could The NTE numerical standard is a
from laboratory testing (e.g., an apply for no more than three NTE function of FTP emission standards
emissions map of similar resolution to deficiencies per engine family. Within contained in today’s final rule, which
the engine’s base fuel injection timing an engine family, NTE deficiencies must standards are described in section II. As
map) and technical analysis relying on be applied for on an engine model or with the NTE standards we have
good engineering judgment which are power rating basis; however, the same established for the 2007 highway rule,
sufficient, in combination, to project deficiency when applied to multiple the nonroad NTE standard is
emissions levels under NTE conditions ratings or models counts as a single determined as a multiple of the engine
reasonably expected to be encountered deficiency within an engine family. No families’ underlying FTP emission
in normal operation and use. Data deficiency may be applied for or granted standard. In addition, as with the 2007
generated from in-use nonroad after the seventh model year. The NTE highway standard, the multiple is either
equipment testing to determine deficiency provision will only be 1.25 or 1.5, depending on the emission
emission levels could, at the considered for failures to meet the NTE pollutant type and the value of the FTP
manufacturer’s option, also be part of requirements. EPA will not consider an standard (or the engine families’ FEL).
this combination. However, a reasonable application for a deficiency for failure to These multipliers are based on EPA’s
basis for the manufacturer’s statement meet the FTP or supplemental transient assessment of the technological
does not require in-use emissions test standards. feasibility of the NTE standard, and our
data. This statement could reasonably Similar to the 2007 highway HD rule, assessment that as the underlying FTP
be based solely on laboratory test data, we are also finalizing a provision which standard becomes more stringent, the
analysis, and other information would allow a manufacturer to exclude NTE multiplier should increase (from
reasonably sufficient to support a defined regions of the NTE engine 1.25 to 1.5). The FTP standard or FEL
conclusion that the engine will meet the control zone from NTE compliance if thresholds for the NTE standard’s 1.25x
NTE under conditions reasonably the manufacturer could demonstrate multiplier and the 1.5x multiplier are
expected to be encountered in normal that the engine, when installed in a specified for each regulated emission in
vehicle operation and use. If a specified nonroad equipment table III.J–2.
TABLE III.J–2.—T HRESHOLDS FOR APPLYING NTE STANDARD OF 1.25X FTP STANDARD VS. 1.5X FTP STANDARD
Emission Apply 1.25x NTE when . . . Apply 1.5x when . . .
NOX .................................................................... NOX std or FEL ≥ 1.9 g/bhp-hr ........................ NOX std or FEL < 1.9 g/bhp-hr
NMHC ................................................................ NOX std or FEL ≥ 1.9 g/bhp-hr ........................ NOX std or FEL < 1.9 g/bhp-hr
NOX+NMHC ....................................................... NMHC+NOX std or FEL ≥ 2.0 g/bhp-hr ........... NMHC+NOX std or FEL < 2.0 g/bhp-hr
PM ...................................................................... PM std or FEL ≥ 0.05 g/bhp-hr ........................ PM std or FEL < 0.05 g/bhp-hr
CO ...................................................................... All stds or FELs ................................................ No stds or FELs
For example, beginning in 2011, the PM standard of 0.01 g/bhp-hr and a FTP 0.02 g/bhp-hr PM and 0.45 g/bhp-hr
NTE standard for engines meeting a FTP NOX standard of 0.30 g/bhp-hr would be NOX. In the NPRM, we proposed a NOX
threshold value of 1.5 g/bhp-hr as the filters. The PM only carve-out is a sub- requirements because the number of
value at which the NTE multiplier region of the NTE zone in which the defects triggering the submission
would switch from 1.5 to 1.25. NTE PM standard does not apply. requirement rises with the engine family
We proposed this NOX emission Figure III.J–1 contains an illustration of size. The new approach may trigger
threshold level (1.5 g/bhp-hr) primarily the PM carve-out. This is a region of some additional reports for small-
because it is the same value as we high engine speed and low engine volume families, but the percentage-
finalized for the highway NTE. As torque during which engine-out PM based approach will ensure that
shown in table III.J–2, we have finalized emissions are difficult to control to investigations and reports correspond to
a threshold value of 1.9 g/bhp-hr NOX levels below the PM NTE standard. The issues that are likely to be significant.
for nonroad engines. We have finalized dimensions of the PM carve-out are Part 1068, subpart F, is intended to
this higher NOX threshold based on the specified in the regulations. For engines require manufacturers to use
differences in the emission performance equipped with a PM filter, compliance information we would expect them to
of NOX control technologies between with the PM NTE standard in this region keep in the normal course of business.
highway and nonroad diesel engines. is achievable due to the highly efficient We believe in most cases manufacturers
Specifically, nonroad diesel NOX PM reduction capabilities of the CDPF will not be required to institute new
standards have traditionally been higher technology. However, for engines in the programs or activities to monitor
than the equivalent highway NOX under 25 hp category, for which we product quality or performance. A
standard due primarily to the have established Tier 4 emission manufacturer that does not keep
effectiveness of charge-air-cooling and standards that do not require the use of warranty or replacement part
the lack of ram-air for nonroad a PM filter, PM control in this sub- information may ask for our approval to
applications. For example, the nonroad region of the NTE zone with use an alternate defect-reporting
Tier 3 NMHC+NOX standards are higher conventional PM reduction technologies methodology that is at least as effective
than the 2004 heavy-duty highway may not be achievable. Therefore, as we in identifying and tracking possible
standards (e.g., 3.0 g/bhp-hr vs. 2.5 g/ allowed with highway heavy-duty emission-related defects as the
bhp-hr), and the Tier 4 NOX standard is engines certifying to the 0.1 g/bhp-hr requirements of 40 CFR 1068.501. Thus
higher than the 2007 heavy-duty standard, we have created a PM carve- manufacturers will have the flexibility
highway standard (e.g., 0.3 g/bhp-hr vs. out for nonroad engines that use in- to develop defect tracking and reporting
0.2 g/bhp-hr). We expect that the cylinder PM control technologies. programs that work better for their
nonroad Tier 3 standard for engines Specifically, the PM carve-out applies to standard business practices. However,
above 100 hp will require NOX levels of engines meeting a PM standard or FEL until we approve such a request, the
approximately 2.5 g/bhp-hr and we greater than or equal to 0.05 g/bhp-hr. thresholds and procedures of subpart F
expect that for the 2004 highway heavy- continue to apply.
duty standards, NOX levels are K. Investigating and Reporting Manufacturers may also ask for our
approximately 2 g/bhp-hr. In both cases, Emission-Related Defects approval to use an alternate defect-
these emission levels are the building In 40 CFR part 1068, subpart F, we are reporting methodology when the
blocks for the next set of EPA standards adopting defect reporting requirements requirements of 40 CFR 1068.501 can be
(e.g., Tier 4 for nonroad and 2007 for that obligate manufacturers to tell us demonstrated to be highly impractical
highway). Because the nonroad Tier 3 when they learn that emission-control or unduly burdensome. In such cases,
NOX emission levels are expected to be systems are defective and to conduct we will generally allow alternate
approximately 25 percent greater than investigations under certain methodologies that are at least as
the 2004 highway level (2.5 vs 2), we circumstances to determine if an effective in identifying, correcting, and
believe that the NTE NOX multiplier emission-related defect is present. informing EPA of possible emission-
threshold for nonroad should be 25 Under these defect-reporting related defects as the requirements of 40
percent greater for nonroad as compared requirements, manufacturers must track CFR 1068.501. We expect this flexibility
to highway. For these reasons, we have available warranty claims and any other to be useful in special circumstances
finalized a NOX multiplier threshold of available information from dealers, such as when new models of very large
1.9 g/bhp-hr, which is 25 percent greater hotlines, diagnostic reports, or field- engines are introduced for the first time.
than the highway multiplier threshold. service personnel to identify possible In this situation, it may be appropriate
In addition, as proposed, we are defects. If the number of possible to allow an alternate defect reporting
finalizing a number of specific engine defects exceeds certain thresholds, they method because the high cost of these
operating conditions during which the must investigate future warranty claims engines often makes it impractical to
nonroad NTE standard would not apply. and other information to establish build and test large numbers of
The exact criteria for these conditions whether these are actual defects. prototype engines. The initial
are defined in the regulations, but in We believe the investigation production of these engines can have
summary: the NTE does not apply requirement in this rule will allow both similar defect rates to the high levels
during engine start-up conditions; the EPA and the engine manufacturers to often associated with prototype engines.
NTE does not apply during very cold fully understand the significance of any While we are concerned about such
engine intake air temperatures for EGR- unusually high rates of warranty claims defects and want to be kept informed
equipped engines during which the for systems or parts that may have an about them, it is not clear that our basic
engine may require an engine protection impact on emissions. In the past, defect program would be the best way to
strategy; and, finally, for engines reports were submitted based on a very address these defects. In such cases, we
equipped with NOX and/or NMHC low threshold with the same threshold believe it may be more appropriate for
aftertreatment (such as a NOX adsorber), applicable to all size engine families manufacturers to propose an alternative
the NTE does not apply during warm- and with little information about the approach that consolidates reports on a
up conditions for the exhaust emission full extent of the problem. The new regular interval, such as quarterly, and
control device. Finally, while we did approach should result in fewer overall identifies obvious early-life defects
not propose this, we are finalizing the defect reports being submitted by without a formal tracking process. In
NTE PM carve-out provisions for manufacturers than would otherwise be general, we would encourage
engines which will not require PM required under the old defect-reporting manufacturers to propose an alternate
approach to ensure that these defects are noncompliant products (such as production or 20 engines, whichever is
properly addressed while minimizing exported engines), and part shipments greater. For engines over 750 hp, the
the associated burden. are generally not identifiable by model same percentage thresholds apply, but
Issues related to parts shipments year. The final rule therefore requires we are extending the percentage values
received the most attention from manufacturers to pursue a defect down to smaller engine families to
commenters who pointed out that the investigation if the number of shipped reflect their disproportionate
proposed requirement to track parts is higher than the manufacturer contribution to total emissions. For
shipments of all emission-related would expect based on historical these engines, the absolute thresholds
components was overly burdensome shipment levels, specifications for are 25 engines for investigations and 10
and not likely to reveal useful scheduled maintenance, or other factors.
or 15 engines for defects (see table III.K–
information. We have concluded that it We have modified the proposed
is not appropriate to use parts thresholds to address concerns that 1). We believe these thresholds
shipments as a quantitative indicator to manufacturers would be required to adequately balance the desire to
evaluate whether manufacturers exceed investigate and report defects too document emission-related defects
the threshold that would trigger an frequently. For engines under 750 hp, without imposing an unreasonable
investigation. We generally agree with we are adopting investigation thresholds reporting burden. Also, we believe this
manufacturers concerns that parts- of 10 percent of total production or 50 approach to adopting thresholds
shipments data would be too difficult to engines, whichever is greater, for any adequately addresses reporting
evaluate, for example, because parts are single engine family in one model year. requirements for aftertreatment and
often shipped for stocking purposes, Similarly, we are adopting defect- non-aftertreatment components.
parts are installed in compliant and reporting thresholds of 2 percent of total
TABLE III.K–1.—I NVESTIGATION AND DEFECT-REPORTING THRESHOLDS FOR VARYING SIZES OF ENGINE FAMILIES1
Engine size Investigation threshold Defect-reporting threshold
≤750 hp .............................................................. less than 500: 50 ............................................. less than 1,000: 20

500–50,000: 10% ............................................. 1,000–50,000: 2%
50,000+: 5,000 ................................................. 50,000+: 1,000
>750 hp .............................................................. ........................................................................... less than 150: 10
less than 250: 25 ............................................. 150–750: 15
250+: 10% ........................................................ 750+: 2%
Notes:
1 For varying sizes of engine families, based on sales per family in a given model year.
EMA also expressed concern about defects, taking steps as necessary to If the number of engines with a
the existing regulatory language in 40 prevent bias in sampled data (or making specific defect is found to be less than
CFR 1068.501(b)(3), which states that adjusted calculations to take into the threshold for submitting a defect
manufacturers must ‘‘consider defects account any bias that may remain). For report, but information such as warranty
that occur within the useful life period, example, if 75 percent of the data later indicates that there may be
or within five years after the end of the components replaced under warranty additional defective engines, all the
model year, whichever is longer.’’ are available for evaluation, it would be information must be considered in
However, this provision has no effect on appropriate to extrapolate known determining whether the threshold for
the diesel engines subject to the Tier 4 information on failure rates to the submitting a defect report has been met.
standards being adopted today, since components that are unavailable for If a manufacturer has actual knowledge
they all have useful lives of at least five evaluation. from any source that the threshold for
years. We recognize that this issue may The second threshold in 40 CFR submitting a defect report has been met,
be relevant to engine categories that do 1068.501 specifies when a manufacturer a defect report must be submitted even
not have five-year useful lives, such as must report that there is an emission- if the trigger for investigating has not yet
small SI engines, and will consider related defect. This threshold involves a been met. For example, if manufacturers
these concerns in our future regulation smaller number of engines because each receive from their dealers, technical
of such engines. possible occurrence has been screened staff or other field personnel
When manufacturers start an to confirm that it is in fact an emission- information showing conclusively that
investigation, they must consider any related defect. In counting engines to there is a recurring emission-related
available information that would help compare with the defect-reporting defect, they must submit a defect report.
them evaluate whether any of the threshold, the manufacturer generally If manufacturers trigger the threshold
possible defects that contributed to considers a single engine family and to start an investigation, they must
triggering the investigation threshold model year. Where information cannot promptly and thoroughly investigate
would lead them to conclude that these be differentiated by engine family and whether their parts are defective,
were actual defects. Otherwise, model year, the manufacturer must use collecting specific information to
manufacturers are expected to look good engineering judgment to evaluate prepare a report describing their
prospectively at any possible defects whether the information leads to a conclusions. Manufacturers must send
and attempt to determine whether these conclusion that the number of defects the report if an investigation concludes
are actual defects. Also, during an exceeds the applicable thresholds. that the number of actual defects did not
investigation, manufacturers should use However, when a defect report is exceed reporting thresholds.
appropriate statistical methods to required, the manufacturer must report Manufacturers must also send these as
project defect rates if they are unable to all occurrences of the same defect in all status reports twice annually during an
collect information to evaluate possible engine families and all model years. investigation. After investigating for
several months, or perhaps a couple use of ABT credits) in the phase-in years standards. Commenters generally
years, it may become clear that the (after factoring in any adjustments for supported this approach, as long EPA
problems that triggered the investigation early introduction engine credits; see ensures that compliance requirements
will never show enough actual defects section III.M). This minimum required for these engines are enforced.
to trigger a defect report. In this case, production level would be 20% for the However, one equipment
the manufacturer would send us a 75–175 hp category if a manufacturer manufacturer submitted comments
report justifying this conclusion. exercises the option to comply with a suggesting that we should adopt a
In general, we believe this updated reduced phase-in schedule in lieu of program that would provide incentives
approach to defect reporting will using banked Tier 2 ABT credits, as for equipment manufacturers to use the
decrease the number of defect reports discussed in section III.A.1.b. Another early Tier 4 engines in their equipment.
submitted by manufacturers overall important restriction is that For an early low-emission engine
while significantly improving their manufacturers would not be allowed to program to be successful, we agree that
quality and their value to both EPA and have a deficit in the year immediately it is important to provide incentives to
the manufacturer. preceding the completion of the phase- both the engine manufacturer and the
Note that misbuilds are a special type in to 100%. This would help ensure that equipment manufacturer, who may
of emission-related defect. An engine manufacturers are able to make up the incur added cost to install and market
that is not built consistent with its deficit. Since they could not produce the advanced engine in the equipment.
application for certification violates the more than 100% low-NOX engines after As was pointed out in comments, the
prohibited act of introducing into the final phase-in year, it would not be proposed program did not provide clear
commerce engines that are not covered possible to make up a deficit from this incentives to equipment manufacturers
by a certificate of conformity. year. These provisions are identical to to use the (presumably more expensive)
L. Compliance With the Phase-In those adopted in the highway HDDE early low-emission engines. Therefore,
Provisions program. we are adding such provisions. Section
We are also finalizing the proposed III.B.2.e describes these early Tier 4
In section II we described the NOX ‘‘split family’’ allowance for the phase- engine incentive provisions under
and NMHC standards phase-in in years. This provision, which is which equipment manufacturers can
schedule, which is intended to allow similar to a provision of the highway earn increased allowance flexibilities.
engine manufacturers to phase-in their program, allows manufacturers to certify Under those provisions, the engine
new advanced technology engines, engine families to both the phase-in and manufacturer’s incentive to produce the
while they phase-out existing engines. phase-out standards. Manufacturers low-emitting engines will come from
This phase-in requirement is based on choosing this option must assign at the customers’ demand for them, and from
percentages of a manufacturer’s end of the model year specific numbers the fact that the engine manufacturer
production for the U.S. market. We of engines to the phase-in and phase-out can earn ABT program credits for these
recognize, however, that manufacturers categories. All engines in the family engines in the same way as without
need to plan for compliance well in must be labeled with the same NOX and these incentive provisions. If the
advance of the start of production, and PM FELs, which apply for all equipment manufacturer does not wish
that actual production volumes for any compliance testing, and must meet all to earn the increased allowance
one model year may differ from their other requirements that apply to phase- flexibilities, then the engine
projections. On the other hand, we in engines. Engines assigned to the manufacturer would be allowed to use
believe that it would be inappropriate phase-out category may generate the provisions of the incentive program
and infeasible to base compliance solely emission credits relative to the phase- for early low-emission engines
on a manufacturer’s projections. That out standards. described below in this subsection,
could encourage manufacturers to though to do so would require the
overestimate their production of M. Incentive Program for Early or Very
forfeiture of any ABT credits earned by
complying phase-in engines, and could Low Emission Engines
the subject engines, essentially to avoid
result in significantly lower emission We believe that it is appropriate and double counting, as explained below.
benefits during the phase-in. In beneficial to provide voluntary This engine manufacturer incentive
response to these concerns, we incentives for manufacturers to program is being adopted as proposed,
proposed to initially only require introduce engines emitting at very low except for engines above 750 hp, for
nonroad diesel manufacturers to project levels early. Such inducements may which the proposed program requires
compliance with the phase-in based on help pave the way for greater and/or some adjustment to account for the
their projected production volumes, more cost effective emission reductions approach we are taking to final
provided that they made up any deficits from future engines and vehicles. To standards.
(in terms of percent of production) the encourage early introduction of low- As discussed in section II.A.4, the
following year. We received no emission engines, the proposal final rule does not phase in standards
comments on this issue and are contained provisions to allow engine for engines above 750 hp as proposed,
finalizing it as proposed. manufacturers to benefit from producing and instead adopts application-specific
Because we expect that a engines certified to the final standards in 2011 and 2015. The 2011
manufacturer making a good-faith (aftertreatment-based) Tier 4 standards standards are not based on advanced
projection of sales would not be very far prior to the 2011 model year, by being aftertreatment except for NOX on
off of the actual production volumes, we allowed to make fewer engines certified engines above 1200 hp used in generator
are limiting the size of the deficit that to these standards once the Tier 4 sets. To avoid overcomplication of the
would be allowed, as in the highway program takes effect, a concept that we incentive program, which might
program. In all cases, the manufacturer are terming ‘‘engine offsets’’ to avoid discourage its use, we are not separating
would be required to produce at least confusion with ABT program credits. over and under 1200 hp generator set
25% of its production in each phase-in The number of offsets that could be engines into separate groups for these
power category as ‘‘phase-in’’ engines generated would depend on the degree provisions. Instead, any of these engines
(meeting the NOX and NMHC standards to which the engines are able to meet, that meet the 2015 standards before
or demonstrating compliance through or perform better than, the final Tier 4 2015 can earn offsets. We are, however,
separating the generator set engines and early introduction offsets. The in section III.B.2.e, where incentives for
non-generator set engines above 750 hp regulations specify that the standards both the engine manufacturer (ABT
into separate groups, because we are must be met without the use of ABT credits) and the equipment
deferring setting a NOX standard for the credits and actual production of the manufacturer (allowance flexibilities)
latter that is based on use of advanced engines must begin by September 1 are needed to ensure successful early
aftertreatment technology. preceding the first model year when the introduction of clean engines. Because
Table III.M–1 summarizes the standards would otherwise be 15 ppm sulfur diesel fuel will be
requirements and available offsets for applicable. Also, to avoid double- available on a widespread basis in time
engine manufacturers in this program. counting, as explained in the proposal, for 2007 (due to the requirements for on-
As the purpose of the incentive is to the early engines can earn either the highway heavy-duty engines), we are
encourage the introduction of clean engine offsets or the ABT emission allowing engine manufacturers to begin
technology engines earlier than credit, but not both. Note that this is certifying engines to the very low
required, we require that the emission different than the approach taken in the emission levels required to be eligible
standard levels actually be met, and met early Tier 4 engine incentive program for this incentive program, beginning
early, by qualifying engines to earn the for equipment manufacturers described with the 2007 model year.
TABLE III.M–1.—P ROGRAM FOR EARLY INTRODUCTION OF CLEAN ENGINES

Category Engine group Must meet a Per-engine offset
Early ..................................... 25–75 hp ........................... 0.02 g/bhp-hr PM .......................................................... 1.5-to-1

PM-only b ............................. 75–750 hp ......................... 0.01 g/bhp-hr PM .......................................................... PM-only
25–75 hp ........................... 0.02/3.5 g/bhp-hr PM/NMHC+NOX.
75–750 hp ......................... 0.01/0.30/0.14 g/bhp-hr PM/NOX/NMHC.
>750 hp generator set ....... 0.02/0.50/0.14 g/bhp-hr PM/NOX/NMHC ...................... 1.5–to–1
Early Engine b ...................... >750 hp non-generator set 0.03/2.6/0.14 g/bhp-hr PM/NOX/NMHC.
Low NOX Engine ................. >25 hp ............................... as above for Early Engine, except must meet 0.15 g/ 2–to–1
bhp-hr NOX standard.
Notes:
a All engines must also meet the Tier 4 crankcase emissions requirements. Engines must certify using all test and other requirements (such as
NRTC and NTE) otherwise required for final Tier 4 standards.
b Offsets must be earned prior to the start of phase-in requirements in applicable engine groups (prior to 2013 for 25–75 hp engines, prior to
2012 for 75–175 hp engines, prior to 2011 for 175–750 hp engines, prior to 2015 for >750 hp engines).
For any engines being certified under urgent need in many parts of the NOX and NMHC standards (since there
this program before the 2011 model year country as explained in section I, and is no reason for PM offsets to offset
using 15 ppm sulfur certification fuel, because the early learning opportunity emissions of other pollutants). Tier 4
the manufacturer would have to meet with new technologies can help to engines between 25 and 75 hp certified
the requirements described in section ensure a smooth transition to Tier 4 to the 2008 PM standard would not
III.D, including demonstrating that the standards. participate in this program, nor would
engine would indeed be fueled with 15 We are providing this early engines below 25 hp, because they do
ppm sulfur fuel in the field. We expect introduction offset for engines over 25 not have advanced aftertreatment-based
this would occur through selling such hp that meet all of today’s Tier 4 standards.
engines into fleet applications, such as emissions standards (NOX, PM, and An important aspect of the early
municipal maintenance fleets, large NMHC) in the applicable engine incentive provision is that it must be
construction company fleets, or any category. We are also providing this done on an engine count basis. That is,
such well-managed centrally-fueled early introduction offset to engines that a diesel engine meeting new standards
fleet. While obtaining a reliable supply pull ahead compliance with only the early would count as 1.5 such diesel
of 15 ppm maximum sulfur diesel fuel PM standard. However, a PM-only early engines later. This contrasts with a
prior to the 2011 model year will be engine would offset only the PM provision done on an engine percentage
possible, it will require some effort by standard for an offset-using engine. For basis which would count one percent of
nonroad diesel machine operators. We engines in power categories with a diesel engines early as 1.5 percent of
therefore believe it is necessary and percentage phase-in, this would diesel engines later. Basing the
appropriate to provide a greater correspond (during the phase-in years) incentive on an engine count alleviates
incentive for early introduction of clean to offset use for ‘‘phase-out’’ engines any possible influence of fluctuations in
diesel technology. Thus, as proposed, (those required to meet the new Tier 4 engine sales in different model years.
we would count one early engine (that standard for PM but not for NOX or Another important aspect of this
is, an engine meeting the final Tier 4 NMHC). Engines using the PM-only program is that it is limited to engines
standards) as offsetting 1.5 engines later. offset would be subject to the other sold prior to the 2013 model year for
This means that fewer clean diesel applicable Tier 4 emission standards, engines between 25 and 75 hp, prior to
engines than otherwise required may including applicable transient and NTE the 2012 model year for engines
enter the market in later years, but, more standards (see Section III.F) and between 75 and 175 hp, and prior to the
importantly, it means that emission crankcase requirements. The applicable 2011 model year for engines between
reductions would be realized earlier PM standard and requirements for these 175 and 750 hp. In other words, as in
than under our base program. We PM-only offset-using engines would be the highway program, nonroad diesel
believe that providing incentives for those of Tier 3 (Tier 2 for 25–50 hp engines sold during the transitional
early emission reductions is a engines). PM-only offsets would not ‘‘phase-in’’ model years would not be
worthwhile goal for this program, offset engines required to meet other considered ‘‘early’’ introduction engines
because improving air quality is an Tier 4 standards such as the phase-in and would therefore be ineligible to
generate early introduction offsets. 500 ppm may be accidentally or factors. EPA has the authority to
However, such engines and vehicles purposely misfueled with higher-sulfur evaluate whether a manufacturer’s use
would still be able to generate ABT fuel. Any of these misfueling events of engineering judgment is reasonable.
credits. Because the engines over 750 hp could seriously degrade the emission The regulations describe the
engines have no percent-of-production performance of sulfur-sensitive exhaust methodology we use to address any
phase-in provisions, we are allowing emission control devices, or perhaps concerns related to how manufacturers
offsets for early engines in any model destroy their functionality altogether. use good engineering judgment in cases
year prior to 2015. For the same reason, In the highway rule, we adopted a where the manufacturer has such
there is no PM-only offset for these requirement that heavy-duty vehicle discretion (see 40 CFR 1068.5). If we
engines. As with the phase-in itself, and manufacturers notify each purchaser find a problem with a manufacturer’s
for the same reasons, an early that the vehicle must be fueled only use of engineering judgment, we will
introduction engine could only be used with the applicable low-sulfur diesel take into account the degree to which
to offset requirements for engines in the fuel. We also required that diesel any error in judgment was deliberate or
same engine group (25–75 hp, 75–175 vehicles be equipped by the
in bad faith. If manufacturers object to
hp, 175–750 hp, >750 hp generator sets, manufacturer with labels near the
a decision we make under this
and >750 hp non-generator sets) as the refueling inlet to indicate that low
provisions, they are entitled to a
offset-generating engine. sulfur fuel is required. We are adopting
As a further incentive to introduce similar requirements here.88 hearing. This subpart is consistent with
clean engines and vehicles early, we are Specifically, manufacturers will be provisions already adopted for light-
also adopting the proposed provision required to notify each purchaser that duty highway vehicles, marine diesel
that gives engine manufacturers an early the nonroad engine must be fueled only engines, industrial spark-ignition
introduction offset equal to two engines with the applicable low-sulfur diesel engines, and recreational vehicles.
during or after the phase-in years for fuel, and ensure that the equipment is 2. Replacement Engines
engines with NOX levels well below the labeled near the refueling inlet to
final Tier 4 NOX standard. This indicate that low sulfur fuel is required. In the proposal we included a
incentive applies for diesel engines We believe that these measures would provision allowing manufacturers to sell
achieving a 0.15 g/bhp-hr NOX standard help owners find and use the correct a new, noncompliant engine intended to
level (one-half of the aftertreatment fuel and would be sufficient to address replace an engine that fails in service.
based standard for most engines) while misfueling concerns. Thus, more costly The proposed language closely mirrored
also meeting the NMHC and PM provisions, such as fuel inlet restrictors, the existing provisions in 40 CFR
standards. Due to the extremely low should not be necessary. 89.1003(b)(7), except that it specified
emission levels to which these engines In general, beginning in model year that manufacturers could produce new,
and vehicles would need to certify, we 2011, nonroad engines will be required noncompliant replacement engines if no
believe that the double engine count to use the Ultra Low Sulfur diesel fuel engine from any manufacturer were
offset is appropriate. (with less than 15 ppm sulfur). Thus, available with the appropriate physical
In the NPRM we asked for comment the default label will state ‘‘ULTRA or performance characteristics.
on whether or not we should extend the LOW SULFUR FUEL ONLY.’’ The Manufacturers objected to this provision
existing Blue Sky program that labeling requirements for earlier model and requested that the final regulations
encourages the early introduction of year Tier 4 engines are specified in follow the language in 40 CFR part 89,
engines with emission levels (as § 1039.104(e). Some new labeling in which the manufacturer of the new
measured on a transient test) about 40% requirements for earlier model year Tier engine confirm that no appropriate
lower than the Tier 2 standards levels. 3 engines are specified in 40 CFR engine is available from its product line
See 68 FR at 28483. We received 89.330(e). These requirements for earlier (or that of the manufacturer of the
comments both for and against doing so, years generally require that engines and original engine, if that were a different
but no commenter provided substantive equipment be labeled consistent with
arguments or information. Given the company). We agree that the language
the sulfur of the test fuel used for their from 40 CFR part 89 is appropriate, but
very low emissions levels being adopted certification. So where the engine is
in Tier 4, we have decided not to extend we note two things to address remaining
certified using Low Sulfur diesel fuel concerns that manufacturers could
the existing Blue Sky Series program, (with less than 500 ppm sulfur), the
because it does not encourage engines potentially use the replacement-engine
required label will state ‘‘LOW SULFUR provisions to produce large numbers of
emitting at such low emission levels. FUEL ONLY.’’ See section III.D and the
noncompliant products. First, we are
N. Labeling and Notification regulatory text for the other specific
including a specific statement in the
Requirements requirements related to labeling the
regulations that manufacturers may not
earlier model years.
As explained in section II, the use the replacement-engine exemption
emissions standards will make it O. General Compliance to circumvent the regulations. Second,
necessary for manufacturers to employ we plan to use the data-collection
1. Good Engineering Judgment
exhaust emission control devices that provision under 40 CFR 1068.205(d) to
require very low-sulfur fuel (less than The process of testing engines and ask manufacturers to report the number
15 ppm) to ensure proper operation. preparing an application for of engines they sell under the
This action restricts the sulfur content certification requires the manufacturer replacement-engine exemption. Rather
of diesel fuel used in these engines. to make a variety of judgments. This than adopting a specific data-reporting
However, the 2008 emissions standards includes, for example, selecting test requirement, we believe this more
would be achievable with less sensitive engines, operating engines between flexible approach is most appropriate to
technologies and thus it could be tests, and developing deterioration allow us to get information to evaluate
appropriate for those engines to use 88 We also required that highway vehicles be
how manufacturers are using the
diesel fuel with up to 500 ppm sulfur. labeled on the dashboard. Given the type of
exemption without imposing reporting
There could be situations in which equipment using nonroad CI engines, we are not requirements that may involve more or
vehicles requiring either 15 ppm fuel or adopting any dashboard requirement here. less information than is actually needed.
3. Warranty that the engine manufacturer provide The installer is also liable. We may find
We are modifying 40 CFR 1068.115 sufficiently detailed and clear the equipment manufacturer to be in
regarding engine manufacturers’ instructions so that the equipment violation of the tampering prohibitions
warranty obligations by removing manufacturer can readily install the at 40 CFR 1068.101(b)(1) for the
paragraph (b). This paragraph addresses engine and its ancillary components in improper installation, which could
specific circumstances under which a configuration covered under the subject it to substantial civil penalties.
manufacturers may not deny emission- certificate of conformity held by the In any event, the engine manufacturer
related warranty claims, while engine manufacturer. We are also remains liable for the in-use compliance
paragraph (a) of this section addresses requiring that the engine manufacturer of the engine as installed. For example,
the circumstances under which have a contractual agreement obligating it has responsibility for the emission-
manufacturers may deny such claims. the equipment manufacturer to related warranty, including for the
As described in our Summary and complete the final assembly into a aftertreatment, and is responsible for
Analysis of Comments related to our certified configuration. The engine any potential recall liability. However, if
November 8, 2002 final rule (67 FR manufacturer must ship any noncompliance of the in-use engines
68242), we intended to adopt 40 components directly to the equipment stems from improper installation of the
CFR1068.115 without this paragraph. manufacturer or arrange for their aftertreatment, then the tampering that
We wanted to remove paragraph (b) shipment from a component supplier. occurred by the installer may remove
because we agreed with a comment The engine manufacturer must tag the recall liability. Where the engine
pointing out that publishing both engines and keep records. The engine manufacturer had complied with the
paragraphs leaves ambiguous which manufacturer must obtain annual regulations and the failure was solely
provision applies if a situation applies affidavits from each equipment due to the equipment manufacturer’s
that is not on either list. Since neither manufacturer as to the parts and part actions, we would not be inclined to
list can be comprehensive, we believe numbers that the equipment revoke or suspend the exemption or to
the provisions in paragraph (a) manufacturer installed on each engine void the exemption for the entire engine
describing when manufacturers may and must conduct a limited number of family. We may deny the exemption for
deny warranty claims appropriately audits of equipment manufacturers’ future model years if the engine
addresses the issue. As a result, facilities, procedures, and production manufacturer does not take action to
paragraph (b) was inadvertently adopted records to monitor adherence to the
address the factors causing the
as part of the November 2002 final rule. instructions it provided. Where an
nonconformity. On the other hand, if
equipment manufacturer is located
4. Separate Catalyst Shipment the manufacturer failed to comply, had
outside of the U.S., the audits may be
shipped improper parts, had provided
We are adopting provisions that will conducted at U.S. port of distribution
instructions that led to improperly
allow engine manufacturers to ship facilities.
The rule also contains various installed parts, or had otherwise
engines to equipment manufacturers
provisions establishing responsibility contributed to the installation of engines
where the engine manufacturer had not
for proper installation. Where the in an uncertified configuration, we
yet installed the aftertreatment or
engines are not in a certified might suspend, revoke, or void the
otherwise included it as part of the
engine shipment. This allows the engine configuration when installed in nonroad exemption for the engine family. In this
manufacturer to ship the engine without equipment because the equipment case, the engine manufacturer would be
the aftertreatment; for example, in cases manufacturer used improper emission- subject to substantial civil penalties.
where it would be impractical to install control devices or failed to install the P. Other Issues
aftertreatment devices on the engine shipped parts or failed to install the
before shipment or even ship products devices correctly, then both the engine We are also making other minor
with the aftertreatment devices manufacturer and the installer have changes to the compliance program.
uninstalled along with the engine; or responsibility. For the engine maker, the These changes are summarized in table
where shipping it already installed exemption is void for those engines that III.Q–1 below. For more information
would require it to be disassembled and are not in their certified configuration about these changes, you should read
reinstalled when the engine was placed after installation. We may also suspend the NPRM and Summary and Analysis
in the equipment. Today’s final rule or revoke the exemption for future of Comments for this rulemaking. We
requires that the components be engines where appropriate, or void the believe that these changes are
included in the price of the engine and exemption for the entire engine family. straightforward and noncontroversial.
TABLE III.Q–1.—R EGULATORY CHANGES

Issue Regulatory provision
Applicability to alcohol-fueled engines ....................................................................................................................... §§ 1039.101, 1039.107.

Prohibited controls ..................................................................................................................................................... § 1039.115.
Emission-related maintenance instructions ............................................................................................................... § 1039.125.
Engine installation instructions ................................................................................................................................... § 1039.130.
Engines labels ............................................................................................................................................................ §§ 1039.20, 1039.135,
1068.320.
Engine family definition .............................................................................................................................................. § 1039.230.
Test engine selection ................................................................................................................................................. § 1039.235.
Deterioration factors ................................................................................................................................................... § 1039.240.
Engines that use noncommercial fuels ...................................................................................................................... § 1039.615.
Use of good engineering judgment ............................................................................................................................ § 1068.5.
Separate shipment of aftertreatment ......................................................................................................................... § 1068.260.
Exemptions ................................................................................................................................................................. 40 CFR 1068 Subpart C.
Importing engines ....................................................................................................................................................... 40 CFR 1068 Subpart D.
TABLE III.Q–1.—R EGULATORY CHANGES—Continued

Issue Regulatory provision
Hearings ..................................................................................................................................................................... 40 CFR 1068 Subpart G.
Q. Highway Engines make their own duplicate labels as emission reductions. Sulfur
We are changing the diesel engine/ needed. We intend to amend 40 CFR significantly inhibits or impairs the
vehicle labeling requirements in 40 CFR parts 1048 and 1051 to correspond with function of the diesel exhaust emission
86.007–35 to be consistent with the new this change. control devices which will generally be
• As described above in section III, necessary for nonroad diesel engines to
pump labels. This change corrects a
we are revising the criteria meet the emission standards finalized
mistake in the proposal that would have
manufacturers would use to show that today. With the 15 ppm sulfur standard
resulted in confusion for highway
they may use the replacement-engine for nonroad diesel fuel, we have
vehicle operators. (We received no
exemption under 40 CFR 1068.240. We concluded that this emission control
comment on this issue.)
also clarify that we may require technology will be available for model
R. Changes That Affect Other Engine manufacturers to report to us how many year 2011 and later nonroad diesel
Categories engines they sell in given year under the engines to achieve the NOX and PM
replacement-engine exemption. emission standards adopted today. The
We are making some minor changes to
• As described above and in the benefits of today’s program also include
the regulations in 40 CFR parts 1048
Summary and Analysis of Comments, the sulfate PM and SO2 reductions
and 1051 for nonroad spark-ignition we are adding a provision in 40 CFR
engines over 19 kW and recreational achieved by establishing the same
1068.260 to allow manufacturers to ship standard for the sulfur content of
vehicles, respectively. We are also aftertreatment devices directly from the
changing several additional provisions locomotive and marine diesel fuel.
component supplier to the equipment The sulfur requirements established
in 40 CFR parts 1065 and 1068, which manufacturer. This regulatory section
define test procedures and compliance under today’s program are similar to the
includes several provisions to ensure sulfur limits established for highway
provisions for these same categories of that the equipment manufacturer
engines. See the regulatory text for the diesel fuel in prior rulemakings —500
installs the aftertreatment device in a
specific changes. The proposed rule ppm in 1993 (55 FR 34120, August 21,
way that brings the engine to its
included most of these changes. To the 1990) and 15 ppm in 2006 (66 FR 5002,
certified configuration.
extent there were comments on any of • As described above, we are January 18, 2001). Beginning June 1,
these changes, those issues are modifying the defect-reporting 2007, refiners will be required to
addressed elsewhere in this document requirements in 40 CFR 1068.501. produce NRLM diesel fuel with a
or in the Summary and Analysis of • While most of the changes being maximum sulfur content of 500 ppm.
Comments. adopted for part 1065 will only affect Then, beginning June 1, 2010, the sulfur
• In 40 CFR 1048.125 and 40 CFR diesel nonroad engines, we are also content will be reduced for nonroad
1051.125, we are correcting the making minor changes that will also diesel fuel to a maximum of 15 ppm.
provisions related to critical emission- apply for SI engines. These changes, The sulfur content of locomotive and
related maintenance to allow however, are generally limited to marine diesel fuel will be reduced to 15
manufacturers to do maintenance clarifications, corrections, and options. ppm beginning June 1, 2012. The
during service accumulation for They will not affect the stringency of the program contains certain provisions to
durability testing, as long as their standards or create new burdens for ease refiners’ transition to the lower
maintenance steps meet the specified manufacturers. sulfur standards and to enable the
criteria ensuring that in-use engines will efficient distribution of all diesel fuels.
undergo those maintenance procedures. IV. Our Program for Controlling These provisions include the 2012 date
• In 40 CFR 1068.27, we clarify that Nonroad, Locomotive and Marine for locomotive and marine diesel fuel,
manufacturers must make available a Diesel Fuel Sulfur early credits for refiners and importers
reasonable number of production-line We are finalizing today a two-step and special provisions for small
engines so we can test or inspect them sulfur standard for nonroad, locomotive refiners, transmix processors, and
if we make such a request. and marine (NRLM) diesel fuel that will entities in the fuel distribution system.
• We are changing the definition of achieve significant, cost-effective sulfate In general, the comments we received
nonroad engine to explicitly exclude PM and SO2 emission reductions. These during the public comment period
aircraft engines. This is consistent with emission reductions will, by supported the proposed program.
our longstanding interpretation of the themselves, provide dramatic Adjustments we have made to the
Clean Air Act. Clarifying the definition environmental and public health proposed program will make the final
this way allows us to more clearly benefits which far outweigh the cost of program even stronger, both in terms of
specify the applicability of the fuel meeting the standards necessary to our ability to enforce it and the
requirements to nonroad engines in this achieve them. In addition, the final environmental and public health
final rule. sulfur standards for nonroad diesel fuel benefits that it will achieve. In
• We are adding a provision directing will enable advanced high efficiency particular, today’s final program
equipment manufacturers to request emission control technology to be contains provisions to smooth the
duplicate labels from engine applied to nonroad engines. As a result, refining industry’s transition to the low
manufacturers and keep appropriate these nonroad fuel sulfur standards, sulfur fuel requirements, encourage
records if the original label is obscured coupled with our program for more earlier introduction of cleaner burning
in the final installation. The former stringent emission standards for new fuel, maintain the fuel distribution
approach under 40 CFR part 1068 was nonroad engines and equipment, will system’s flexibility to fungibly distribute
to require equipment manufacturers to also achieve dramatic NOX and PM similar products, and provide an outlet
for off-specification distillate product, 15 ppm sulfur highway diesel fuel. The (1) Achieves the greatest reduction in
all while maintaining, and even designate and track approach includes sulfate PM and SO2 emissions from nonroad,
enhancing, the health and record keeping and reporting locomotive, and marine diesel engines as
environmental benefits of today’s requirements for all parties in the fuel early as practicable;
(2) Provides for a smooth transition of the
program. distribution system, associated with NRLM diesel fuel pool to 15 ppm sulfur;
The first adjustment that we made to tracking designated fuel volumes (3) Ensures that 15 ppm sulfur diesel fuel
the proposed program was to move from through each custodian in the is produced and distributed widely for use in
the ‘‘refiner baseline’’ approach distribution chain until the fuel exits all 2011 and later model year nonroad diesel
discussed in the proposal to a the terminal. The program also includes engines;
‘‘designate and track’’ approach. Under enforcement and compliance assurance (4) Ensures that the fuel program’s
the proposed refiner baseline approach, provisions to enable the Agency to requirements are enforceable and verifiable.
any refiner or importer could choose to rapidly and accurately review for (5) Enables the efficient distribution of all
fungibly distribute its 500 ppm sulfur discrepancies the large volume of data diesel fuels; and
NRLM and highway diesel fuels without collected on fuel volume hand-offs. The (6) Maintains the benefits and program
adding red dye to the NRLM at the integrity of the highway diesel fuel program.
bulk of the designate and track
refinery gate. However, the refiners’ provisions end May 31, 2010 when all The remainder of this section covers
production would then be subject to a highway diesel fuel must meet the 15 several topics. In section IV.A, we
non-highway distillate baseline, ppm sulfur standard. However, as discuss the fuel that is covered by
established as a percentage of its total discussed below, scaled back designate today’s program, the standards that
distillate fuel production volume. While and track provisions continue beyond apply for refiners and importers (for
EPA preferred this approach in the 2010 for purposes of enforcing against both steps of the program), and the
proposal, we decided not to finalize it heating oil being used in the NRLM standards that apply for downstream
because we concluded that it would market and to enforce against 500 ppm entities. In section IV.B, we address the
have unnecessarily constrained refiners’ LM diesel fuel being used in the various hardship provisions that we are
ability to meet market demands. It nonroad market. including in today’s program. In section
would have encouraged them to dye 500 The second adjustment that we made IV.C, we describe the special provisions
ppm sulfur NRLM at the refinery gate, to the proposed NRLM diesel fuel that apply in the State of Alaska and the
resulting in an additional grade of diesel program was to establish a 15 ppm Territories. Next, in section IV.D, we
fuel and, consequently, an added sulfur standard at the refinery gate for describe the design of the designate and
burden to the distribution system. locomotive and marine (LM) diesel fuel track provisions of the NRLM diesel fuel
Furthermore, we were concerned that it in addition to nonroad (NR) diesel program for compliance purposes and
would have created a trend that could fuel.89 We are finalizing this standard how it differs from what we proposed.
reduce the volume of 15 ppm sulfur for several reasons as discussed below. In section IV.E, we discuss the impact
highway diesel fuel and potential While we are finalizing a 15 ppm of today’s program on state NRLM diesel
options to remove the market sulfur standard for locomotive and fuel programs. In sections IV.F and G,
constraints could have increased the marine diesel fuel, we are doing so in we discuss the technological feasibility
possibility for reduced volume. a manner that responds to the primary of the NRLM diesel fuel standards
In place of the refiner baseline concerns raised in comments regarding adopted today and the impacts of
approach, we are finalizing a designate the need for an outlet for off- today’s program on lubricity and other
and track approach. The final designate specification product. We are setting a fuel properties. Finally, in section IV.H,
and track approach is a modified refinery gate standard of 15 ppm sulfur we discuss the steps the Agency will
version of the designate and track beginning June 1, 2012, two years later take to streamline the refinery air
approach discussed in the proposal. As than for nonroad diesel fuel. We are also permitting process for the equipment
finalized it now allows us to enforce the continuing to provide an outlet for off- that refiners may need to install to meet
program through the entire distribution specification product generated in the today’s NRLM diesel fuel standards..
system. In essence, the final designate distribution system, thereby affording Analyses supporting the design and
and track approach requires refiners and the opportunity to reduce reprocessing cost of the fuel program are located in
importers to designate the volumes of and transportation costs. We are leaving chapters 5, 7, and 8 of the RIA. Section
diesel fuel they produce and/or import. the downstream standard for LM diesel V of this preamble discusses the details
Refiners/importers will identify whether fuel at 500 ppm sulfur. In this way the of the additional compliance and
their diesel fuel is highway or NRLM LM diesel fuel pool may remain an enforcement provisions affecting NRLM
and the applicable sulfur level. They outlet for off-specification distillate diesel fuel and explains various
may then mix and fungibly ship product and interface/transmix material.
additional elements of the program.
highway and NRLM diesel fuels that In developing the provisions of the
meet the same sulfur specification NRLM diesel fuel program adopted A. Nonroad, Locomotive and Marine
without dyeing their NRLM diesel fuel today, we identified several principles Diesel Fuel Quality Standards
at the refinery gate. The designations that we want the program to achieve.
1. What Fuel Is Covered by This
will follow the fuel through the Specifically, as described in more detail
Program?
distribution system with limits placed below, we believe the fuel program—
on the ability of downstream parties to The fuel covered by today’s final rule
change the designation. These limits are 89 While today’s program does not establish more is generally the same as the fuel that was
designed to restrict the inappropriate stringent emission standards for locomotive or covered by the proposal. We have not
marine diesel engines, the Agency intends in the
sale of 500 ppm sulfur NRLM diesel fuel near future to initiate a rulemaking to adopt new
expanded or reduced the pool of diesel
into the highway market , the emission standards for locomotive and marine fuel that will be subject to the lower
inappropriate sale of heating oil into the engines based on the use of high efficiency exhaust sulfur standards. However, the second
NRLM market, the inappropriate sale of emission control technology like that required for step of the program now includes the
the nonroad standards adopted in today’s rule. An
500 ppm sulfur LM into the nonroad advanced notice of proposed rulemaking (ANPRM)
same ultra low sulfur standard for
market, and to implement the for this rule is published elsewhere in today’s locomotive and marine diesel fuel as for
downgrading restrictions that apply to Federal Register, June 29, 2004. nonroad diesel fuel.
Specifically, the sulfur standards stationary diesel engines, industrial boilers, produced when fuels such as DMA are
finalized under today’s program apply or for heating; brought on board the vessel in this
to all the diesel fuel that is used in (3) Number 4, 5, and 6 fuels (e.g., residual manner. EPA’s sulfur standards will
nonroad, locomotive, and marine diesel fuels or residual fuel blends, IFO Heavy Fuel apply to the distillate that is used to
Oil Grades 30 and higher), used for stationary
applications—fuel not already covered source purpose; produce the DMB, for example the DMA
by the previous standards for highway (4) Any distillate fuel with a T–90 distillate, up to the point that it becomes
diesel fuel. This includes all fuel used distillation point greater than 700 F, when DMB. DMB itself is not subject to the
in nonroad, locomotive, and marine used in Category 2 or 3 marine diesel sulfur standards when it is used in
diesel engines, except for fuels heavier engines. This includes Number 4, 5, and 6 Category 2 or 3 engines.
than a No. 2 distillate used in Category fuels (e.g., IFO Heavy Fuel Oil Grades 30 and DMC is a grade of marine fuel that
2 and 3 marine engines 90 and any fuel higher), as well as fuels meeting ASTM may contain some residual fuel and is
that is exempted for national security or specifications DMB, DMC, and RMA–10 and often a residual fuel blend. This fuel is
heavier; and similar to No. 4 diesel, and can be used
other reasons. While we are not
(5) Any fuel for which a national security
adopting sulfur standards for other in Category 2 and Category 3 marine
or research and development exemption has
distillate fuels (such as jet fuel, heating been approved or fuel that is exported from diesel engines. DMC is produced by
oil, kerosene, and No. 4 fuel oil) we are the U.S. (see section V.A.1. and 2). blending a distillate fuel with residual
adopting provisions to prevent the fuel, for example at a location
It is useful to clarify what marine downstream in the distribution system.
inappropriate use of these other fuels.
diesel fuels are covered by the sulfur EPA’s standards will apply to the
Use of distillate fuels in nonroad,
standards. As with nonroad and distillate that is used to produce the
locomotive, or marine diesel engines
will generally be prohibited unless they locomotive diesel fuel, our basic DMC, up to the point that it is blended
meet the fuel sulfur standards finalized approach is that the standards apply to with the residual fuel to produce DMC.
today.91 The program includes several any diesel or distillate fuel used or DMC itself is not subject to the sulfur
provisions, as described below in intended for use in marine diesel standards when it is used in Category 2
section IV.D, to ensure that heating oil engines. However, the fuel used by or 3 marine engines.
and other higher sulfur distillate fuels marine diesel engines spans a wide Residual fuel is typically designated
will not be used in nonroad, locomotive, variety of fuels, ranging from No. 1 and by the prefix RM (e.g., RMA, RMB, etc.).
or marine applications. 2 diesel fuel to residual fuel and These fuels are also identified by their
The regulated fuels under today’s residual fuel blends used in the largest nominal viscosity (e.g., RMA10, RMG35,
program include the following: engines. It is not EPA’s intention to etc.). Most residual fuels require
cover all such fuels, and EPA has treatment by a purifier-clarifier
(1) Any No. 1 and 2 distillate fuels used,
adopted an objective criteria to identify centrifuge system, although RMA and
intended for use, or made available for use
in nonroad, locomotive, or marine diesel those marine fuels subject to regulation RMB do not require this. For the
engines. Fuels under this category include and those that are not. Any distillate purpose of this rule, we consider all RM
those meeting the American Society for fuel with a T–90 greater than 700 F will grade fuel as residual fuel. Residual fuel
Testing and Materials (ASTM) D 975 or D 396 not be subject to the sulfur standards is not covered by the sulfur content
specifications for grades No. 1–D and No. 2– when used in Category 2 or 3 marine standards as it is not a distillate fuel.
D. Fuels meeting ASTM DMX and DMA engines. This criteria is designed to The distillation criteria adopted by
specifications would be covered; exclude fuels heavier than No. 2 EPA, T–90 greater than 700F, is
(2) Any No. 1 distillate fuel (e.g., kerosene)
added to such No. 2 diesel fuel, e.g., to distillate, including blends containing designed to identify those fuels that are
improve its cold flow properties; residual fuel. In addition, residual fuel not subject to the sulfur standards when
(3) Any other fuel used in nonroad, is not subject to the sulfur standards. used in Category 2 or 3 marine diesel
locomotive, or marine diesel engines or While many marine diesel engines engines. It is intended to exclude DMB,
blended with diesel fuel for use in such use No. 2 distillate, ASTM DMC, and other heavy distillates or
engines. Fuels under this category include specifications for marine fuels identify blends, when used in Category 2 or 3
non-distillate fuels such as biodiesel and four kinds of marine distillate fuels: marine diesel engines.
certain specialty fuel grades such as JP–5, JP– DMX, DMA, DMB, and DMC. DMX is a Hence, the fuel that refiners and
8, and F76 if used in a nonroad, locomotive,
or marine diesel engine, except when a special light distillate intended mainly importers are required to produce to the
national security or research and for use in emergency engines. DMA more stringent sulfur standards include
development exemption has been approved. (also called MGO) is a general purpose those No. 1 and No. 2 diesel fuels as
See V. A.1. and 2. marine distillate that is to contain no well as similar distillate or non-
On the other hand, the sulfur traces of residual fuel. These fuels can distillate fuels that are intended or made
standards do not apply to— be used in all marine diesel engines but available for use in NRLM diesel
are primarily used by Category 1 engines. Furthermore, the sulfur
(1) No. 1 distillate fuel used to power engines. DMX and DMA fuels intended standard also covers any fuel that is
aircraft;
for use in any marine diesel engine are blended with or substituted for No. 1 or
(2) No. 1 or No. 2 distillate fuel used for
stationary source purposes, such as to power subject to the fuel sulfur standards. No. 2 diesel fuel for use in nonroad,
DMB, also called marine diesel oil, is locomotive, or marine diesel engines.
90 Category 3 marine engines frequently are not typically used with Category 1 For instance, as required under the
designed to use residual fuels and include special engines, but is used for Category 2 and highway diesel fuel program, in those
fuel handling equipment to use the residual fuel. 3 engines. DMB is allowed to have a situations where the same batch of
91 For the purposes of this final rule, the term
trace of residual fuel, which can be high kerosene is distributed for two purposes
heating oil basically refers to any No. 1 or No. 2
distillate other than jet fuel, kerosene, and diesel
in sulfur. This contamination with (e.g., kerosene to be used for heating and
fuel used in highway, nonroad, locomotive, or residual fuel usually occurs due to the to improve the cold flow of No. 2 NRLM
marine applications. For example, heating oil distribution process, when distillate is diesel fuel), or where a batch distributed
includes fuel which is suitable for use in furnaces, brought on board a vessel via a barge just for heating is later distributed for
boilers, stationary diesel engines and similar
applications and is commonly or commercially
that has previously contained residual blending with No. 2 diesel fuel, that
known or sold as heating oil, fuel oil, or other fuel, or using the same supply lines as batch of kerosene must meet the
similar trade names. are used for residual fuel. DMB is standards adopted today for NRLM
diesel fuel. The purpose of this provisions as well as transmix produce as it shifts all of its distillate
requirement is to ensure that fuels like processors. production to 15 ppm sulfur.92
jet fuel, kerosene, and/or military We are finalizing the 15 ppm sulfur
a. The First Step to 500 ppm Sulfur standard for locomotive and marine
specification fuels meet the diesel fuel
NRLM Diesel Fuel diesel fuel, along with nonroad diesel
sulfur standards adopted under today’s
program when they are used in nonroad, Under today’s program, NRLM diesel fuel, for several reasons. First, it will
locomotive, or marine diesel engines. fuel produced by refiners or imported provide important health and welfare
into the U.S. by importers must meet a benefits from the additional sulfate PM
2. Standards and Deadlines for Refiners and SO2 emission reductions as early as
and Importers 500 ppm sulfur standard beginning June
1, 2007. Refiners and importers may possible. Second, it is technologically
The NRLM diesel fuel program comply by either producing such fuel at feasible, as it is for nonroad diesel fuel.
adopted today is a two-step approach to or below 500 ppm sulfur, or they may Third, the benefits outweigh the costs
reduce the sulfur content of NRLM comply by obtaining credits as and the costs do not otherwise warrant
diesel fuel from uncontrolled levels discussed in section IV.D below. delaying this second step for locomotive
down to 15 ppm sulfur. While we and marine. As shown in chapter 8 of
We believe that the adopted level of the RIA, the costs for the increment of
received several comments supporting a
500 ppm sulfur is appropriate for LM diesel fuel going from 500 to 15
single step down to 15 ppm sulfur, the
several reasons. First, the reduction to ppm sulfur is just $0.20 billion in 2030.
vast majority of commenters, especially
500 ppm sulfur is significant Fourth, it will simplify the fuel
most refiners and engine manufacturers,
environmentally. The 500 ppm sulfur distribution system and overall design
supported the two-step approach. We
level achieves approximately 90 percent of the fuel program. For example, the
are finalizing the two-step approach
of the sulfate PM and SO2 benefits addition of a marker to locomotive and
primarily because it achieves the
otherwise achievable by going all the marine diesel fuel after 2012 is no
greatest reduction in sulfate PM and SO2
way to 15 ppm sulfur. Second, because longer necessary to successfully enforce
emissions from nonroad, locomotive,
this first step is only to 500 ppm sulfur, the program. Finally, it will allow
and marine diesel engines as early as
it also allows for a short lead time for refiners to coordinate plans to reduce
practicable. By starting with an initial
implementation, enabling the the sulfur content of all of their off-
step of 500 ppm sulfur we can achieve
environmental benefits to begin highway diesel fuel at one time.
significant emission reductions and
accruing as soon as possible. Third, it is Our primary reason in the NPRM for
associated health and welfare benefits
consistent with the current specification leaving locomotive and marine diesel
from the current fleet of equipment as
for highway diesel fuel, a grade which fuel at the 500 ppm sulfur specification
soon as possible. As discussed in
may remain for highway purposes until was to preserve an outlet for off-
section VI, the health-related benefits of
2010. As such, adopting the same 500 specification product that may be
the fuel standards finalized today, even
ppm sulfur level for NRLM diesel fuel created in the distribution system
without the engine standards, amount to
helps to avoid issues and costs through contamination of 15 ppm sulfur
more than $28 billion in 2030, while the
associated with more grades of fuel in diesel fuel with higher sulfur distillates
projected costs, after taking into account
the distribution system during this and for off-specification batches of fuel
engine maintenance benefits amount to
initial step of the program. that are produced by refineries during
just $0.7 billion.
the first couple years of the 15 ppm
In addition, the two-step approach b. The Second Step to 15 ppm Sulfur
sulfur program (when they are still
encourages a more smooth and orderly NRLM Diesel Fuel
perfecting their production processes).
transition by the refining industry to 15 However, we have concluded that it is
ppm sulfur NRLM diesel fuel, by We are finalizing a second step of
sulfur control down to 15 ppm sulfur for not necessary to leave the standard for
providing more time for refiners to all locomotive and marine diesel fuel at
develop the most cost-effective all NRLM. This second step provides
additional important direct sulfate PM the 500 ppm sulfur specification to
approaches, finance them, and then address these concerns. Setting a 15
implement the necessary refinery and SO2 emission reductions and
associated health benefits. As discussed ppm sulfur standard for refiners and
modifications. importers in 2012, but maintaining a
Finally, by waiting until 2010 to drop in the RIA, the health related benefits
for this second step of fuel control by downstream standard for locomotive
to the 15 ppm sulfur standard for NR and marine diesel fuel at 500 ppm
diesel fuel, the two-step approach itself are greater than the associated
cost. Furthermore, the second step for sulfur and allowing off-specification
harmonizes with the highway diesel product to continue to be sold into this
fuel program by delaying the nonroad diesel fuel is essential to enable
the application of high efficiency market accomplishes the same goal.
implementation of the 15 ppm sulfur In addition, controlling the sulfur
standard for NR diesel fuel until the end exhaust emission control technologies
to nonroad diesel engines beginning content of NRLM diesel fuel from
of the phase-in period for 15 ppm sulfur uncontrolled levels to 15 ppm is clearly
highway diesel fuel. The 2010 date also with the 2011 model year as discussed
a cost-effective fuel control program.
harmonizes with the date 15 ppm in Section II of this preamble.
While the incremental cost-effectiveness
nonroad fuel is needed to enable the In the proposal, the second step of the from 500 ppm sulfur to 15 ppm sulfur
nonroad engines standards finalized program only applied to nonroad diesel is less cost-effective, the benefits of this
today. The second step to 15 ppm sulfur fuel, while locomotive and marine second step outweigh the costs, the
for the LM diesel fuel is set for 2012. On diesel fuel could remain at 500 ppm concerns about a market for off-
balance we believe that the advantages sulfur. We also sought comment on specification product have been
of the two-step approach outweigh those finalizing the 15 ppm sulfur standard addressed, and other factors discussed
of a single step down to 15 ppm. for LM diesel fuel in 2010 along with
As discussed in section IV.C, below, nonroad diesel fuel, as well as delaying 92 Off-specification fuel here refers to 15 ppm
later deadlines for meeting the 500 and it until as late as 2012 to allow for an diesel fuel that becomes contaminated such that it
no longer meets the 15 ppm sulfur cap. In most
15 ppm sulfur standards apply to additional outlet for any off- cases, off-specification 15 ppm sulfur diesel fuel is
refineries covered by special hardship specification product a refinery might expected to easily meet a 500 ppm sulfur cap.
above support the reasonableness of this This off-specification material generally One refining company commented
approach. The body of evidence cannot be added in any significant that EPA should not implement the
strongly supports the view that quantity to either of the adjoining cetane index and aromatic requirements
controlling sulfur in NRLM fuel to 15 products that produced the interface.93 in the proposed rule since the impacts
ppm, through a two-step process, is Under today’s program, as discussed in are weak or nonexistent for engines to
quite reasonable in light of the more detail in section A.3, below, off- be used in the future. In addition, the
emissions reductions achieved, taking specification material that is generated commenter stated that the vast majority
costs into consideration. in the distribution system may be of diesel fuel already meets the EPA
Implementation of today’s rule will distributed as 500 ppm NRLM diesel cetane index/aromatics specification for
reduce the sulfur level of almost all fuel from June 1, 2010 through May 31, highway diesel fuel and that there is
distillate fuel to a 15 ppm maximum 2014 and as 500 ppm LM from June 1, nothing in the RIA that either
sulfur level. In addition to the small 2014 and beyond. Furthermore, as demonstrates the benefits or supports
refiner, hardship, and other provisions discussed in section IV.C, below, the need for such a requirement. The
adopted in this rule, EPA is adopting transmix processors, which are facilities commenter also stated that EPA should
several provisions that will help ensure that process transmix by separating it not set a requirement simply because
a smooth transition to the second step into its components (e.g., separating the ASTM standard has a cetane number
of 15 ppm sulfur diesel fuel. First, gasoline from diesel fuel), are treated as specification for a particular fuel.
refiners and importers of locomotive a separate class of refiners. One hundred Low cetane levels are associated with
and marine diesel fuel, a small segment percent of the diesel fuel they produce increases in NOX and PM emissions
of the entire distillate pool, will be from transmix may be sold as high from current nonroad diesel engines.94
required to meet a 15 ppm sulfur sulfur NRLM until June 1, 2010, 500 Thus, we expect that extending the
standard starting June 1, 2012, two years ppm sulfur NRLM until June 1, 2014, cetane index specification to NRLM
later than for nonroad diesel fuel. and 500 ppm sulfur LM diesel fuel after diesel fuel will directionally lead to a
Second, 500 ppm sulfur diesel fuel June 1, 2014. reduction in these emissions from the
generated in the distribution system These provisions provide refiners and existing fleet. However, because the vast
through contamination of 15 ppm sulfur importers with a similar degree of majority of NRLM diesel fuel already
fuel can be marketed in the nonroad, flexibility for off-specification product meets the specification, the NOX and
locomotive and marine market until as the proposal which held the sulfur PM emission reductions will be small.
June 2014, and in the locomotive and standard for all locomotive and marine At the same time, the refining/
marine market after that date. Third, 500 diesel fuel at 500 ppm indefinitely. If production costs associated with
ppm sulfur diesel fuel produced by off-specification product is produced, extending the cetane index specification
transmix processors from contaminated there is a temporary outlet for it. If to NRLM diesel fuel are negligible as
downstream diesel fuel can also be providing the off-specification product current NRLM diesel fuel already meets
marketed to the nonroad, locomotive to a locomotive and marine market is a more stringent ASTM specification.
and marine markets, under the same difficult under this final rule, such that ASTM already recommends a cetane
schedule. While today’s rule does not a refiner will choose to re-process it, number specification of 40 for NRLM
contain an end date for the downstream then the refiner would have been in the diesel fuel, which is, in general, more
distribution of 500 ppm sulfur same position under the proposal. stringent than the similar 40 cetane
locomotive and marine fuel, we will Furthermore, these provisions provide index specification. Because of this, the
review the appropriateness of allowing the refining industry an alternative to vast majority of current NRLM diesel
this flexibility based on experience reprocessing the off-specification fuel already meets the EPA cetane
gained from implementation of the 15 material created in the distribution index/aromatics specification for
ppm sulfur NRLM diesel fuel standard. system, which preserves refining highway diesel fuel. Thus, the cetane
We expect to conduct such an capacity for the production of new fuel index specification will impact only a
evaluation in 2011. volume, helping to maintain overall few refiners and there will be little
When EPA adopted a 15 ppm sulfur diesel fuel supply. overall cost associated with producing
standard for highway diesel fuel, we As with the 500 ppm sulfur standard
fuel to meet the cetane/aromatic
included several provisions to ensure a under the first step of today’s program,
requirement. In fact, as discussed in
smooth transition to 15 ppm sulfur refiners and importers may comply with
chapter 5.9 of the RIA, compliance with
highway fuel. One provision was a the 15 ppm sulfur standard by either
the sulfur standards adopted today is
temporary compliance option, with an producing NRLM diesel fuel containing
expected to result in a small cetane
averaging, banking and trading no more than 15 ppm sulfur or by
component. In a similar manner, the obtaining sulfur credits (until June 1, increase as increases in cetane correlate
2012 deadline for 15 ppm sulfur LM 2014), as described below. with decreases in sulfur, leaving little or
fuel, the last, relatively small segment of no further control to meet the standard.
c. Cetane Index or Aromatics Standard While the emissions benefits and
diesel fuel, will help ensure that the
Currently, in addition to containing refining/production costs of extending
entire pool of diesel fuel is smoothly
transitioned to the 15 ppm sulfur level no more than 500 ppm sulfur, highway the specification to NRLM diesel fuel
over a short period of time. (See section diesel fuel must meet a minimum cetane may be small, the extension will reduce
8.3 of the summary and analysis of index level of 40 or, as an alternative, costs by giving refiners and distributors
comments.) contain no more than 35 volume percent the ability to fungibly distribute
EPA is also adopting two provisions aromatics. Today’s program extends this highway and NRLM diesel fuels of like
aimed at smoothing the transition of the cetane index/aromatics content sulfur content. For that small fraction of
distribution system to ultra low sulfur specification to NRLM diesel fuel. NRLM diesel fuel today that does not
diesel fuel. These provisions are meet the cetane index or aromatics
93 In some cases the off-specification product can
designed to accommodate off-
not be added to the adjoining products because of 94 The Effect of Cetane Number Increase Due to
specification fuel generated in the the applicable sulfur standards. In other cases, the Additives on NOX Emissions From Heavy-Duty
distribution system, such as through the off-specification product, called transmix, must be Highway Engines, Final Technical Report, February
mixing that occurs at product interfaces. re-processed before it can be used. 2003, EPA420–R–03–002.
specification, the requirement will a. Standards and Deadlines From June 1, fuel and heating oil must be re-
eliminate the need for refiners and fuel 2007 Through May 31, 2010 designated and labeled as heating oil.
distributors to separately distribute fuels As soon as the program begins on
of different cetane/aromatics b. Standards and Deadlines From June
June 1, 2007, all NRLM diesel fuel must 1, 2010 Through May 31, 2014
specifications. Requiring NRLM diesel be designated or classified and must
fuel to meet this cetane index comply with the designation or Beginning June 1, 2010, most NR
specification thus gives fuel distributors classification stated on its product diesel fuel will be required to meet the
certainty in being able to combine transfer document (PTD), pump label, or 15 ppm sulfur standard, and beginning
shipments of highway and NRLM diesel other documentation. In other words, if June 1, 2012, most LM diesel fuel will
fuels. Perhaps more importantly, it can the fuel is intended for sale as NRLM be required to meet the 15 ppm sulfur
also give engine manufacturers and end- diesel fuel and is labeled as 500 ppm standard. However, some production of
users the confidence they need that sulfur diesel fuel, then beginning June 1, 500 ppm sulfur NRLM diesel fuel may
their fuel will meet the minimum cetane 2007, it must comply with the 500 ppm
or maximum aromatics standard. Given continue through May 31, 2014. As with
sulfur standard. Similarly, if fuel is the delayed downstream compliance
the inherent difficulty in segregating intended for sale as NRLM diesel fuel
two otherwise identical fuels, were we dates for the 500 ppm sulfur standard
and is labeled as 15 ppm sulfur, then under the first step of today’s program,
not to carry over these standards to beginning June 1, 2010 (or June 1, 2009
NRLM, lower cetane NRLM could easily parties downstream of refineries will be
under the early credit provisions), it allowed additional time to turnover
find its way into current highway must comply with the 15 ppm sulfur
engines. If not designed for this lower their tanks to 15 ppm sulfur NR diesel
standard.
cetane fuel, these engines could have fuel. Specifically, at the terminal level,
Beginning June 1, 2010, all NRLM
elevated emission levels and diesel fuel produced or imported is all NR diesel fuel will be required to
performance problems. required to meet at least a 500 ppm meet the 15 ppm sulfur standard
Overall, we believe that there will be sulfur limit. In order to allow for a beginning August 1, 2014. At any
a small reduction in NOX and PM smooth and orderly transition to 500 wholesale purchaser-consumer facilities
emissions from current engines and the ppm sulfur NRLM diesel fuel in the and retail stations carrying all NR diesel
economic benefits from more efficient distribution system, and allow any fuel, including bulk plants serving as
fuel distribution will likely exceed the remaining high sulfur fuel to be sold, we retailers, NR diesel fuel must meet the
cost of raising the cetane level for the are providing parties downstream of 15 ppm sulfur standard beginning
small volume of NRLM diesel fuel that refineries time to turnover their NRLM October 1, 2014. Thus, beginning
does not already meet the cetane index tanks to 500 ppm sulfur diesel fuel. At October 1, 2014, 500 ppm sulfur NR
or aromatics content specification. the terminal level, all NRLM diesel fuel diesel fuel may no longer legally exist
must meet at least the 500 ppm sulfur in the fuel distribution system.97
3. Standards, Deadlines, and
Flexibilities for Fuel Distributors standard beginning August 1, 2010. At Like the first step to 500 ppm sulfur,
any wholesale purchaser-consumer prior to these 2014 downstream
The first years of the NRLM diesel facilities and any retail stations carrying deadlines all NRLM diesel fuel would
fuel program include various NRLM diesel fuel, including bulk plants still be designated or classified with
flexibilities to smooth the refining and that serve as retailers, all diesel fuel respect to sulfur level and required to
distribution industry’s transition to 15 must meet the 500 ppm sulfur standard meet the designation or classification
ppm sulfur fuel. These flexibilities beginning October 1, 2010.95 Thus, stated on its PTD, pump label, or other
include a 2012 deadline for production beginning October 1, 2010, high sulfur documentation.
of 15 ppm sulfur locomotive and marine (greater than 500 ppm sulfur) NRLM
diesel fuel, credit provisions, small diesel fuel may no longer legally exist c. Sulfur Standard for NRLM Diesel Fuel
refiner provisions, hardship provisions, in the fuel distribution system.96 Beginning June 1, 2014
and downstream off-specification fuel Although we expect that most NRLM
provisions. As a result, during the diesel fuel in the distribution system As discussed above, all refiners will
transition years, we are not able to will be subject to the 500 ppm sulfur be required to produce and importers
simply enforce the sulfur standards standard during the period from June 1, will be required to import only 15 ppm
downstream based on a single sulfur 2007 through May 31, 2010, based on its sulfur NRLM diesel fuel by June 1, 2014.
level of the new standard. From June 1, designation or classification, some of However, we will continue to allow 500
2007 through May 31, 2010, both 500 the 500 ppm sulfur NRLM diesel fuel ppm sulfur diesel fuel to be sold into
ppm sulfur diesel fuel and high sulfur may be mixed with high sulfur NRLM the LM diesel fuel markets beyond 2014.
diesel fuel can be produced, distributed, diesel fuel. Since the blended product The LM diesel fuel markets are expected
and sold for use in NRLM diesel will likely no longer meet the 500 ppm to provide a valuable outlet for higher
engines. From June 1, 2010 through May sulfur standard, it must be re-designated sulfur distillate fuel produced in the
31, 2014, both 15 ppm sulfur and 500 and labeled as high sulfur NRLM diesel distribution system, at least through the
ppm sulfur diesel fuel can be produced, fuel. Similarly, fuel that results from early years of the program.
distributed, and sold for use in NRLM blending 500 ppm sulfur NRLM diesel Consequently, beyond 2014, both 15
diesel engines. Beyond June 1, 2014, ppm sulfur and 500 ppm sulfur LM
both 15 ppm sulfur and 500 ppm sulfur 95 A bulk plant is a secondary distributor of
diesel fuel may continue to exist in the
diesel fuel that is produced from fuel refined petroleum products. They typically receive
fuel from terminals and distribute fuel in bulk by distribution system, and each fuel must
product downgrade and transmix in the truck to end users. Consequently, while for highway comply with the designation stated on
distribution system can be distributed fuel, bulk plants often serve the role of a fuel its PTD, pump label, or other
and sold for use in locomotive and distributor, delivering fuel to retail stations, for
documentation.
marine diesel engines. As these nonroad fuel, they often serve the role of the
retailer, delivering fuel directly to the end-user.
transition flexibilities expire, however, 96 By December 1, 2010, all NRLM diesel fuel, 97 By December 1, 2014, all NR diesel fuel,
we are able to streamline our including fuel in end-user tanks, must comply with including fuel in end-user tanks, must comply with
downstream enforcement provisions. at least the 500 ppm sulfur standard. at least the 15 ppm sulfur standard.
d. Interface/Transmix Flexibility for sufficient to accommodate distillate fuel emission controls). Beginning with the
Fuel Distributors exceeding 15 ppm sulfur that is 2011 model year, such equipment will
As described above, today’s program generated in the pipeline. Therefore, require the use of 15 ppm sulfur diesel
provides flexibility to the distribution such fuel would need to be returned to fuel to operate properly. The same
system by allowing interface/transmix a refinery for reprocessing to meet a 15 concerns do not exist regarding the
material generated within the ppm sulfur standard. In addition, some continued use of such 500 ppm sulfur
distribution system to be sold into the refiners may be reluctant to accept such diesel fuel in locomotive and marine
NRLM diesel fuel markets. Specifically, material for reprocessing given the engines for three reasons. First,
any fuel interface/transmix generated in impact this would have on their refinery locomotive and marine engines are not
the fuel distribution system may be sold operations. More importantly, because currently required to be equipped with
as: such material appears at the terminus of the sulfur sensitive emissions
the pipeline distribution system and aftertreatment that will start being used
(1) High sulfur NRLM diesel fuel or heating often where no access to pipeline or on nonroad equipment in 2011.100
oil from June 1, 2007 through May 31, 2010;
(2) 500 ppm sulfur NRLM diesel fuel or marine shipment is available, it would Second, locomotive and marine markets
heating oil from June 1, 2010 through May have to be shipped back to a refinery by are centrally fueled to a much greater
31, 2014; or truck, or rail if available, at additional extent than nonroad markets, and thus
(3) 500 ppm sulfur LM diesel fuel or cost. enforceability is not as significant of an
heating oil after June 1, 2014. As discussed in chapter 7 of the RIA, issue. Finally, we believe the program’s
Hence, beginning June 1, 2014, fuel generated from such interface/ designate and track provisions
interface/transmix material exceeding transmix will typically meet a 500 ppm discussed below will be sufficient to
15 ppm sulfur may only be sold into the sulfur standard. Therefore, allowing the enforce the limits on production and
LM diesel fuel or heating oil markets. As continued use of such 500 ppm sulfur use of 500 ppm sulfur diesel fuel.
discussed above, the downstream diesel fuel in locomotive and marine It is difficult to project exactly how
standard for LM diesel fuel will be 500 engines could reduce the burden on the much of this downstream generated
ppm sulfur. However, heating oil may fuel distribution industry by lowering downgraded fuel could be segregated
not be shifted into the LM markets. costs. Our cost estimates of marketing and shipped to LM markets. However, it
Parties in the distribution system such fuel include additional shipping is clear that this provision represents an
receiving diesel fuel with a sulfur charges for situations where there is not important flexibility for the distribution
content greater than 15 ppm sulfur must a local locomotive or marine market (see system. In fact, it provides virtually the
maintain records and report to EPA section VI of this preamble).99 Allowing same flexibility as provided by the
information demonstrating that they did the continued sale of 500 ppm sulfur proposal to handle off-specification
not shift heating oil into the LM diesel fuel into the locomotive and product. In both cases, use of the
markets, as discussed in section IV.D. marine markets without requiring it to flexibility is dependent on the ability to
The generation of greater than 15 ppm be reprocessed will also help preserve segregate the interface and transport it
sulfur distillate fuel from pipeline refining capacity for the overall diesel to available LM markets. While today’s
interface/transmix cannot be avoided fuel production. Therefore, this rule does not contain an end date for the
due to the physical realities of a multi- provision also serves to address downstream distribution of 500 ppm
product fuel distribution system. Such lingering concerns expressed by some sulfur locomotive and marine fuel, we
fuel first appears at the terminus of the refiners regarding the impacts of the 15 will review the appropriateness of
pipeline distribution system; at ppm sulfur standard for highway and allowing this flexibility based on
terminals due to the generation of NRLM diesel fuel on overall diesel fuel experience gained from implementation
segregated interface, or at transmix supply. of the 15 ppm sulfur NRLM diesel fuel
processing facilities.98 In areas where Downstream-generated 500 ppm standard. We expect to conduct such an
there is a strong demand for heating oil, sulfur diesel fuel may only be used in evaluation in 2011.
much of this pipeline-generated off- nonroad engines until December 1, A summary of the NRLM sulfur levels
specification fuel can be sold into the 2014, due to concerns regarding and final deadlines for refiners,
heating oil market, just as it is today. enforceability and the increased importers, terminals, and other
However, in many areas of the country potential for misfueling of nonroad downstream parties is shown in table
the demand for heating oil would not be equipment (equipment with advanced IV–1 below.
TABLE IV–1.—500 PPM SULFUR AND 15 PPM SULFUR NRLM FINAL COMPLIANCE DATES
Bulk plants, whole-
Refiners and sale purchaser-con
Credit, small refiner Terminals Other locations
importers sumers and retail out-
lets
500 ppm NRLM .......... June 1, 2007 ............. June 1, 2010 ............. August 1, 2010 ......... October 1, 2010 ........ December 1, 2010.
15 ppm NR ................. June 1, 2010 ............. June 1, 2014 ............. August 1, 2014 ......... October 1, 2014 ........ December 1, 2014.
98 Segregated interface refers to the mixing zone engines. An advanced notice of proposed implementation of the 15 ppm sulfur NRLM diesel
between two batches of fuel that abut each other in rulemaking (ANPRM) for this rule is published fuel standard. We would conduct such an
the pipeline, where the volume in the mixing zone elsewhere in today’s Federal Register, June 29, evaluation in 2011.
can not be cut into either of the fuel batches, but 2004. While we are not finalizing a sunset date for 100 Although, as mentioned above, the Agency
can still meet another fuel product specification this downgrade provision in today’s final rule, we intends in the near future to initiate a rulemaking
without reprocessing, provided that it is drawn off are evaluating the appropriateness of establishing a to adopt new emission standards for locomotive
of the pipeline separately and segregated. sunset date on this provision in the context of the and marine engines. An advanced notice of
99 As mentioned above, the Agency intends in the subsequent engine standards rule. We also intend proposed rulemaking (ANPRM) for this rule is
near future to initiate a rulemaking to adopt new to review the appropriateness of any sunset published elsewhere in today’s Federal Register,
emission standards for locomotive and marine provision in light of experience gained from June 29, 2004.
TABLE IV–1.—500 PPM SULFUR AND 15 PPM SULFUR NRLM FINAL COMPLIANCE DATES—Continued
Bulk plants, whole-
Refiners and sale purchaser-con
Credit, small refiner Terminals Other locations
importers sumers and retail out-
lets
15 ppm LM ................. June 1, 2012 ............. June 1, 2014.
4. Diesel Sulfur Credit Banking and the program’s second step when they Vol500 = Volume of 500 ppm sulfur
Trading Provisions are still adjusting their operations for diesel fuel produced and designated
Today’s final program includes consistent production/importation of as highway or NRLM
provisions for refiners and importers to NRLM diesel fuel that is subject to the Basehwy = 2003–2005 highway diesel
generate early credits for the production new sulfur standards. fuel baseline volume
of 500 ppm sulfur NRLM diesel fuel a. Credit Generation From June 1, 2006 Volhwy = Volume of diesel fuel produced
prior to June 1, 2007 and for the Through May 31, 2007 and designated as highway
production of 15 ppm sulfur NRLM If the excess production is 15 ppm
diesel fuel prior to June 1, 2010. These Credits may be generated under sulfur diesel fuel instead of 500 ppm
credit banking and trading provisions today’s program to allow for the sulfur diesel fuel, then the refiner will
will provide implementation flexibility production of high sulfur NRLM diesel have the option of generating 500 ppm
by facilitating a somewhat smoother fuel after June 1, 2007. A refiner or sulfur credits under the highway diesel
transition at the start of the program in importer may obtain credit for early fuel program. Credit may not be earned
2007, with some refineries/import production/importation of fuel meeting under both programs for a given volume
facilities complying early, others on the 500 ppm sulfur standard that they of 500 ppm sulfur or 15 ppm sulfur
time, and others a little later. These designate as NRLM diesel fuel, from diesel fuel.
credit banking and trading provisions June 1, 2006 through May 31, 2007. In
addition, small refiners may also b. Credit Generation From June 1, 2009
may also facilitate some of the
generate credits for the early production Through May 31, 2010
environmental benefits of the program
being achieved earlier than otherwise of 500 ppm sulfur diesel fuel that they In addition to allowing credit for the
required, and may increase the overall designate as NRLM diesel fuel. As early production of 500 ppm sulfur
environmental benefits of the program. described in section IV.B, below, small NRLM diesel fuel, today’s program also
As discussed below, overall benefits refiners are not required to produce any allows credit for the early production of
will accrue if refiners produce 500 ppm 500 ppm sulfur NRLM diesel fuel until 15 ppm sulfur NRLM diesel fuel.
earlier in lieu of high sulfur NRLM and June 1, 2010. Those small refiners who Specifically, refiners and importers may
then bank those credits to continue choose to comply with the 500 ppm obtain credit for early production/
producing 500 ppm sulfur NR diesel sulfur standard earlier than required, importation of fuel meeting the 15 ppm
fuel in 2010 or 500 ppm LM diesel fuel that is before June 1, 2010, may generate sulfur standard and that they designate
in 2012 in lieu of 15 ppm.101 credits for any volume of diesel fuel as NRLM from June 1, 2009 through
Specifically, credits generated under they produce from June 1, 2007 through May 31, 2010. In addition, small
the NRLM diesel fuel program may be May 31, 2010 and designate as NRLM. refiners, which are not required to
banked and later used to delay Credits for the early production of 500 produce any 15 ppm sulfur NRLM
compliance with either the 500 ppm ppm sulfur fuel (including by small diesel fuel until June 1, 2014, may also
sulfur NRLM standard that begins in refineries) are fungible, may be banked generate credits for the early production
2007, the 15 ppm sulfur NR standard for future use, or traded to any other of any volume of 15 ppm sulfur diesel
that begins in 2010, or the 15 ppm refiner or importer nationwide. In order fuel that they designate as NRLM from
sulfur LM standard that begins in 2012. to ensure that these early credits are real June 1, 2010 through December 31,
Credits may also be traded within and not merely shifts from the highway 2013. Again, these early credits are
companies such that credits generated at market, both early credits and small fungible, may be banked for future use,
one refinery/import facility in a given refinery credits will be subject to a limit or traded to any other refinery or
company may be traded to another determined by the following formula: importer nationwide. However, in order
refinery/import facility within that same CreditHS = (Vol15 + Vol500) ¥ Volhwy to ensure these credits are real and not
company. In addition, refiners or CreditHS Limit = (Vol15 + Vol500) ¥ merely shifts from the highway market,
importers may purchase credits Basehwy credits for the early production or
generated by other refiners or importers Where: importation of 15 ppm sulfur fuel will
to meet the program requirements. be subject to a limit determined by the
Credit500 Limit = Limit for 500 ppm
Finally, and perhaps most importantly, following formula:
NRLM credits
individual refineries/import facilities Credit500 = Vol15 ¥ Vol15hwy
may be able to use credits to permit the CreditHS = High-Sulfur NRLM credits102
Vol15 = Volume of 15 ppm sulfur diesel Credit500 Limit = Vol15 ¥ Base15hwy
continued sale of otherwise off-

fuel produced and designated as Where: Ä
specification product at the beginning of
highway or NRLM Credit500 Limit = Limit for 500 ppm Ä
101 We are not adopting specific provisions to
sulfur NRLM credits
generate credits for early production of LM diesel 102 For the purposes of this rule, credits are Vol15 = Volume of 15 ppm sulfur diesel
fuel prior to June 1, 2012. The difference in start labeled on the basis of their use in order to follow fuel produced and designated as
date between 2010 and 2012 already provides the convention used in the highway diesel rule. A highway or NRLM
additional flexibility to producers of LM diesel fuel, high-sulfur credit is generated through the
and setting separate credit generation periods for production of one gallon of 500 ppm sulfur NRLM
Base15hwy = 2006–2008 15 ppm sulfur
NR and LM diesel fuel would unnecessarily diesel fuel and allows the production of one gallon highway diesel fuel baseline
complicate the compliance assurance provisions. of high sulfur NRLM diesel fuel. volume
Hence, to generate credits, a refiner or to the 15 ppm sulfur standard, except sulfur standards, as well as for refiners’
importer’s highway diesel fuel volume LM diesel fuel produced by transmix planning for the highway diesel
for the compliance period must be processors from transmix can continue standards. The details of these
greater than or equal to the baseline to meet the 500 ppm sulfur limit. provisions are discussed below.
volume. That is, a refiner or importer We proposed that all credits would
expire May 31, 2012, however we are 1. Hardship Provisions for Qualifying
may only generate credits for ‘‘new’’
finalizing an expiration date of May 31, Small Refiners
volumes of 15 ppm sulfur diesel fuel
that it produces. If their highway diesel 2014 based on the comments we As in previous fuel rulemakings, our
fuel volume were to drop below the received. The additional two years that justification for including provisions
baseline volume, that would likely we are now allowing for credit use (1) specific to small refiners is that, in
indicate a shift in production from the will provide a longer period for refiners general, small refiners generally have a
highway market to generate 15 ppm to sell off-specification fuel instead of degree of hardship in complying with
sulfur NRLM diesel fuel credits. having to reprocess it, (2) is an the standards compared to other
environmentally neutral change to the refiners. In the NPRM, we proposed
c. Credit Use flexibilities/transition provisions, or
overall program, and (3) is now
There are two ways in which refiners consistent with the end-date for small ‘‘hardship provisions’’ (these terms are
or importers may use high-sulfur NRLM refiner flexibility. equivalent), for small refiners. We are
credits under the NRLM diesel fuel While credits can be generated and adopting the provisions that were
program. First, credits may be used traded nationwide, they are restricted proposed for small refiners virtually
during the period from June 1, 2007 from use in certain parts of the country unchanged, and including similar
through May 31, 2010 to continue to under the provisions of this final rule. provisions for the treatment of
produce high sulfur NRLM diesel fuel. As discussed in section IV.D, we are locomotive and marine fuel.
Any high sulfur NRLM diesel fuel that avoiding the burden to terminals of a. Regulatory Process and Justification
is produced, however, must be adding marker to heating oil in those for Small Refiner Relief
designated and labeled as such for areas of the country where demand for
tracking purposes throughout the heating oil is expected to continue to In developing our NRLM diesel fuel
distribution system and be dyed red at remain high after today’s final rule. The sulfur program, we evaluated the
the refinery gate. NRLM diesel fuel sulfur standards will environmental need as well as the
The second way in which refiners and be enforced based on sulfur level in technical and financial ability of
importer could use high-sulfur NRLM these areas, not through the refinery refiners to meet the 500 and 15 ppm
credits is by banking them for use designation and marker provisions. sulfur standards as expeditiously as
during the June 1, 2010 through May 31, Consequently, in the area defined in possible. We believe it is feasible and
2014 period. Credits used in this section IV.D comprising most of the necessary for the vast majority of the
manner would provide a net Northeast and Mid-Atlantic region of program to be implemented in the
environmental benefit, since they were the country, as well as in the State of established time frame to achieve the air
generated by reducing the sulfur level Alaska, many of the fuel program’s quality benefits as soon as possible.
from approximately 3000 ppm to less flexibilities, including refiners’ ability to Based on information available from
than 500 ppm (a net change of 2500 use credits, are not allowed. Refiners small refiners and others, we believe
ppm sulfur), but when used only allow and importers may not use credits to that refiners classified as small generally
the sulfur level to increase from 15 ppm produce or import diesel fuel with a face unique circumstances with regard
to 500 ppm (a net change of less than sulfur content greater than 500 ppm to compliance with environmental
500 ppm sulfur). 500 ppm sulfur credits beginning June 1, 2007 or 15 ppm programs, compared to larger refiners.
generated from the early production of Consequently, as discussed below, we
beginning June 1, 2010, for sale or
15 ppm sulfur NRLM diesel fuel may are finalizing several special provisions
distribution in this Northeast/Mid-
also be used from June 1, 2010 through for refiners that qualify as ‘‘small
Atlantic area or the State of Alaska.
May 31, 2014. Thus, during this period, refiners’’ to reduce the disproportionate
However, credits generated in these
when the 15 ppm sulfur standard is in burden that today’s program will have
areas can be sold to other refiners and/
effect for nonroad diesel fuel, refiners/ on them.
or importers for use outside these areas.
importers may use either high sulfur Small refiners generally lack the
credits or 500 ppm sulfur credits to B. Hardship Relief Provisions for resources that are available to large
continue producing/importing 500 ppm Qualifying Refiners refining companies, including those
sulfur nonroad diesel fuel. Any 500 As in our gasoline sulfur and highway large companies that own small-
ppm sulfur diesel fuel that is produced, diesel fuel sulfur programs, today’s capacity refineries, to raise capital for
however, must be appropriately program contains the following investing in desulfurization equipment,
designated and labeled for tracking hardship relief provisions to provide such as shifting of internal funds,
purposes throughout the distribution regulatory flexibility to challenged securing of financing, or selling of
system, and cannot be sold for use in refiners: assets. Small refiners are also likely to
2011 and later model year nonroad • Small refiner hardship for have more difficulty in competing for
engines. From June 1, 2012, when the 15 qualifying small refiners; engineering and construction resources
ppm sulfur standard for LM diesel fuel • General hardship for any refiner needed for the installation of the
becomes effective, through May 31, experiencing either— desulfurization equipment which will
2014, refiners/importers may use either (1) Extreme unforeseen circumstances likely be required to meet the standards
high sulfur credits or 500 ppm sulfur such as natural disaster or acts of God; finalized in this action.
credits to continue producing/importing or Because small refiners are more likely
500 ppm sulfur NRLM diesel fuel. All (2) Extreme hardship circumstances to face adverse circumstances with
credits expire after May 31, 2014. such as financial or technical hardship. regard to regulatory compliance than
Hence, beginning June 1, 2014, all Similar provisions have proved larger refiners, we are finalizing interim
NRLM diesel fuel produced by refiners invaluable for some refiners in the provisions that will provide additional
or imported in the U.S. will be subject recent implementation of the gasoline time for refineries owned by small
refiners to meet the sulfur standards. those comments, can be found in gasoline sulfur control, vendors will be
This approach will allow the overall section X.C of this preamble, and also more likely to contract their services
program to begin as early as possible, the Summary and Analysis of with the larger refiners first, as their
avoiding the need for delay in order to Comments. projects will offer larger profits for the
address the ability of small refiners to vendors. Temporarily delaying
ii. Rationale for Small Refiner
comply. compliance for small refiners will
Regulatory Flexibility Provisions
spread out the demand for these
i. Regulatory Flexibility Process for Generally, we structured the small resources and may help reduce cost
Small Refiners refiner provisions to reduce the burden premiums for everyone caused by
As explained in the discussion of our on small refiners while expeditiously limited engineering and construction
compliance with the Regulatory achieving air quality benefits and supply.
Flexibility Act (RFA) in section X.C of ensuring that the availability of 15 ppm We discuss below the provisions that
this preamble, and in the Final sulfur NR diesel fuel will coincide with we are finalizing to minimize the degree
Regulatory Flexibility Analysis in the introduction of 2011 model year of hardship imposed upon small
chapter 11 of the RIA, we considered nonroad diesel engines and equipment. refiners by this program. With these
the impacts of today’s regulations on We believe the special provisions for provisions we are confident in going
small businesses. Most of our analysis of small refiners are necessary and forward with the 500 ppm sulfur
small business impacts was performed appropriate for several reasons. standard for NRLM diesel fuel in 2007
as part of the Small Business Advocacy First, the compliance schedule for and the 15 ppm sulfur standard for NR
Review (SBAR) Panel convened by EPA, today’s program, combined with special diesel fuel in 2010 and for LM diesel
pursuant to the RFA as amended by the relief provisions for small refiners, will fuel in 2012, for the rest of the industry.
Small Business Regulatory Enforcement achieve the air quality benefits of the The provisions for small refiners will
Fairness Act of 1996 (SBREFA). The program as soon as possible, while allow these refiners to continue to
Panel’s final report is available in the helping to ensure that small refiners produce higher sulfur NRLM fuel until
rulemaking public docket (Docket A– will have adequate time to raise capital June 1, 2010, and similarly, will allow
2001–28, Document No. II–A–172). for new or upgraded fuel desulfurization for the production of 500 ppm nonroad
For the SBREFA process, EPA equipment. Most small refiners have NRLM fuel until June 1, 2014. Without
conducted outreach, fact-finding, and limited additional sources of income small refiner relief, we would have to
analysis of the potential impacts of the beyond refinery earnings for financing consider delaying the overall program
proposed nonroad regulations on small and typically do not have the financial until the burden of the program on
businesses. Based on these discussions backing that larger and generally more many small refiners was diminished,
and analyses by all panel members, the integrated companies have. Therefore, which would delay the air quality
Panel concluded that small refiners in additional time to accumulate capital benefits of the overall program. By
general would likely experience a internally or to secure capital financing providing temporary relief to small
significant and disproportionate from lenders can be central to their refiners, we are able to adopt a program
financial burden in reaching the ability to comply. that expeditiously reduces NRLM diesel
objectives of the proposed nonroad Second, we recognize that while the fuel sulfur levels in a feasible manner
diesel fuel sulfur program. sulfur levels in today’s program can be for the industry as a whole.
One indication of the achieved using conventional refining The four-year leadtime from which
disproportionate burden on small technologies, new technologies are also begins in 2010 for small refiners for
refiners is the relatively high cost per being developed that may reduce the locomotive and marine diesel fuel is
gallon projected for producing NRLM capital and/or operating costs of sulfur identical to the relief that was supported
diesel fuel under today’s program. removal. Thus, we believe that by small refiners for nonroad diesel fuel.
Refinery modeling of refineries owned providing small refiners some We believe that this relief is necessary
by refiners likely to qualify as small additional time to allow for new and adequate to reduce the burden on
refiners, and of refineries owned by technologies to be proven out by other small entities while still achieving our
other non-small refiners, indicates refiners will have the added benefit of air quality goals. Small refineries vary
significantly higher refining costs for reducing the risks faced by small considerably in their markets for NRLM
small refiners. Specifically, we project refiners. The added time will likely diesel fuels. Consequently, the proposal
that without special provisions, refining enable small refiners to benefit from the to control nonroad diesel fuel to 15 ppm
costs for small refiners on average lower costs of these improvements in sulfur impacted small refiners with
would be about two cents per gallon desulfurization technology (e.g., better significant nonroad market shares, but
higher than for other refiners in the catalyst technology or lower-pressure left those with significant locomotive
same PADD to meet the 15 ppm sulfur hydrotreater technology). This will help and marine market shares relatively
standard. to offset the disproportionate financial untouched. With control of all NRLM
The Panel also noted that the burden burden that may be imposed upon small diesel fuel to 15 ppm sulfur in this final
imposed on small refiners by the refiners. rule, all small refiners of NRLM diesel
proposed sulfur standards may vary Finally, providing small refiners more fuel will face similar challenges, and
from refiner to refiner. Thus, the Panel time to comply will spread out the therefore the same four year lead time
recommended more than one type of availability of engineering and from 2010 proposed for those small
burden mitigation so that most, if not construction resources. Most refiners refiners impacted by nonroad fuel
all, small refiners could benefit. We will need to install additional control alone is also appropriate when
considered the issues raised during the processing equipment to meet the the standards are expanded to all
SBREFA process, and discussed them in NRLM diesel fuel sulfur requirements. NRLM. In essence, while more small
the NPRM, and have decided to finalize We anticipate that there may be refiners face the challenge of
each of the provisions recommended by significant competition for technology desulfurizing all of their diesel fuel to
the Panel. A discussion of the comments services, engineering resources, and the 15 ppm sulfur standard, the
we received regarding small refiners and construction management and labor. In magnitude of this challenge is not any
terminal operators, and our responses to addition, as has been the experience in greater. Furthermore, providing
additional relief (beyond 2014) to small vehicles, even if the likely ‘‘blending Specifically, a refiner that either
refiners would undermine the program down’’ of sulfur levels does not occur as acquires or restarts a refinery that was
by further delaying air quality benefits. this fuel mixed with lower sulfur fuel shut down or non-operational between
The 2014 deadline for all small refiner during distribution. This provision will January 1, 2002 and January 1, 2003
diesel fuel to 15 ppm sulfur will also also maintain the maximum 450 ppm may apply for small refiner status. In
simplify the fuel program and it will gasoline sulfur per-gallon cap standard such cases, we will judge eligibility
allow small refiners the ability to in all cases, providing a reasonable under the employment and crude oil
coordinate their plans to reduce the sulfur ceiling for any small refiners capacity criteria based on the most
sulfur content of all off-highway diesel using this provision. recent 12 consecutive months of data
fuel at the same time. unless we conclude from the data
b. Small Refiner Definition for Purposes
provided by the refiner that another
iii. Impact of Small Refiner Options on of the Hardship Provisions
period of time is more appropriate.
Program Emissions Benefits The definition of small refiner under Companies with refineries built after
Small refiners that choose to delay the the NRLM diesel program is similar to January 1, 2002 are not eligible for the
NRLM diesel fuel sulfur requirements the definitions under the Tier 2/ small refiner provisions. Similarly,
will also delay to some extent the Gasoline Sulfur and Highway Diesel entities that do not own or operate a
emission reductions that would rules. Under the NRLM program, a small refinery are not eligible to apply for
otherwise have been achieved. refiner must demonstrate that it meets small refiner status.
However, for several reasons, the overall the following criteria:
impact of these postponed emission • Produced NRLM diesel from crude; c. Provisions for Small Refiners
reductions will be small. First, small • No more than 1,500 employees We are finalizing several provisions
refiners represent only a fraction of corporate-wide, based on the average intended to reduce the regulatory
national non-highway diesel number of employees for all pay periods burden of today’s program on small
production. Today, refiners that we from January 1, 2002 to January 1, 2003; refiners as well as to encourage their
expect to qualify as small refiners and, early compliance whenever possible. As
represent only about six percent of all • A corporate crude oil capacity less described below, these small refiner
high-sulfur diesel production. Second, than or equal to 155,000 barrels per relief options consist of additional time
the delayed compliance provisions calendar day (bpcd) for 2002. for compliance and, for small refiners
described below will affect only engines As with the earlier fuel sulfur that choose to comply earlier than
without new emission controls. During programs, the effective dates for the required, the option of either generating
the program’s first step to 500 ppm determination of employee count and diesel fuel sulfur credits or receiving a
sulfur NRLM diesel fuel, small refiner for calculation of the crude capacity limited relaxation of their gasoline
NRLM diesel fuel could be well above represent the most recent complete year sulfur standards.
500 ppm sulfur, but the new advanced prior to the issuing of the proposed
rulemaking (2002, in this case). i. NRLM Delay Option
engine controls will not yet be required.
During the second step to 15 ppm sulfur In determining its total number of First, we are finalizing an option that
NRLM diesel fuel, equipment with the employees and crude oil capacity, a allows small refiners to postpone their
new controls will be entering the refiner must include the number of compliance with the NRLM diesel fuel
market, but use of the 500 ppm small employees and crude oil capacity of any sulfur standards. The delayed
refiner fuel will be restricted to older subsidiary companies, any parent compliance schedule for small refiners
engines without the new controls. There company and subsidiaries of the parent is intended to compensate for the
will be some loss of sulfate PM control company, and any joint venture relatively higher compliance burdens on
in the older engines that operate on partners. We define a subsidiary of a these refiners. It is not intended as an
higher sulfur small refiner fuel, but no company to mean any subsidiary in opportunity for those refiners to greatly
effect on the major emission reductions which the company has a 50 percent or expand their production of uncontrolled
that the new engine standards will greater ownership interest. However, diesel fuel (2007–2010) or 500 ppm
achieve starting in 2011. Finally, refiners owned and controlled by an sulfur diesel fuel (2010–2014). To help
because small diesel refiners are Alaska Regional or Village Corporation ensure that any significant expansion of
generally dispersed geographically organized under the Alaska Native refining capacity that a small refiner
across the country, the limited loss of Claims Settlement Act (43 U.S.C. 1626), might undertake in the future is
sulfate PM control will also be are also eligible for small refiner status, accompanied by an expansion of
dispersed. based only on the refiner’s employees desulfurization capacity, small refiners
One option for small refiner relief will and crude oil capacity. Such an producing higher sulfur fuel must limit
allow a modest 20 percent relaxation in exclusion is consistent with our desire their production to baseline volume
the gasoline sulfur interim standards for to grant regulatory relief to that part of levels. Specifically, during the first step
small refiners that produce all of their the industry that is the most challenged of today’s diesel fuel program to 500
NRLM diesel fuel at 15 ppm sulfur by with respect to regulatory compliance. ppm sulfur, from June 1, 2007 through
June 1, 2006. To the extent that small We believe that very few refiners, May 31, 2010, a small refiner may at any
refiners elect this option, a small loss of probably only one, will qualify under or all of its refineries produce
emission control from Tier 2 gasoline this provision. We are also uncontrolled NRLM diesel fuel up to the
vehicles that use the higher sulfur incorporating this exclusion into the 2003 through 2005 non-highway
gasoline could occur. We believe that small refiner provisions of the highway baseline volume for the refinery(s). Any
such a loss of control will be very small. diesel and gasoline sulfur rules, which diesel fuel produced over the baseline
Very few small refiners will be in a did not address this issue. volume will be subject to the 500 ppm
position to use this provision. Further, As under the gasoline sulfur and sulfur standard applying to other
the relatively small production of highway diesel fuel rules, refiners that refiners. Similarly, from June 1, 2010
gasoline with slightly higher sulfur either acquire or restart a refinery in the through May 31, 2014, a small refiner
levels should have no measurable future may be eligible for small refiner may produce at any or all of its
impact on the emissions of new Tier 2 status under the NRLM program. refineries NRLM diesel fuel subject to
the 500 ppm sulfur standard at a volume from small refiner or credit-using high in locomotives or marine engines during
equal to or less than the refineries’ sulfur NRLM made this option this time. Section IV.D below discusses
2006–2008 non-highway baseline undesirable in these areas. Based on our the requirements for designating and
volumes. LM fuel produced to the 500 review of anticipated small refiner tracking the production of 500 ppm
ppm standard during 2010 to 2012 situations, this portion of PADD 1 sulfur NRLM diesel fuel produced by
would be counted towards meeting this appears unlikely to provide a small refiners during this period.
baseline volume. NRLM fuel produced meaningful market for small refiners The following table illustrates the
in excess of the baseline volume will be seeking this option. Therefore, in this small refiner NRLM diesel fuel sulfur
subject to the 15 ppm sulfur NRLM part of the country it imposed costs standards as compared to the standards
diesel fuel standard. The baseline for without providing the intended benefit. for the base NRLM diesel fuel program.
2003–2005 will be determined by Consequently, while this option was As previously stated, small refiners will
subtracting the refinery’s highway proposed to be available nationwide, we receive additional lead time, compared
volume from its total highway and are not finalizing it for a portion of to non-small refiners for 15 ppm sulfur
heating oil volume production. The PADD 1. This change from the proposal locomotive and marine diesel fuel. This
baseline for 2006–2008 will be should have no meaningful impact on lead time is identical to that which had
determined based upon the volume of small refiners’ flexibility, but will been proposed for 15 ppm sulfur
the refinery’s NRLM fuel designations reduce the costs for fuel distributors. nonroad diesel fuel. This will ensure
discussed in section IV.D. Since new engines with sulfur that emission benefits of ultra low sulfur
As discussed in section IV.D, the costs sensitive emission controls will begin to diesel fuel are achieved as soon as
to the distribution system to mark become widespread beginning in 2011, possible, and should not significantly
heating oil in areas of PADD 1 with high small refiner fuel can only be sold for change the nature or magnitude of the
heating oil demand to distinguish it use in pre-2011 nonroad equipment or burden on affected small refiners.
TABLE IV–4.—S MALL REFINER NRLM DIESEL FUEL SULFUR STANDARDS, PPM A
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015+
Non-Small Refiners–NR fuel ................................................ .......... 500 500 500 15 15 15 15 15 15

Non-Small Refiners–LM fuel ................................................ .......... 500 500 500 500 500 15 15 15 15
Small Refiners–NR diesel fuel ............................................. .......... .......... .......... .......... 500 500 500 500 15 15
Small Refiners–LM diesel fuel ............................................. .......... .......... .......... .......... 500 500 500 500 15 15
Notes: a New standards will take effect on June 1 of the applicable year.
ii. NRLM Credit Option June 1, 2010 through December 31, allowed under the gasoline sulfur
2013. The specifics of the credit program.
Some small refiners have indicated program are described in section IV.A.4, We believe it is very important to link
that, for a variety of reasons, they might including how the program applies to any relaxation of a small refiner’s
need to produce fuel meeting the NRLM small refiners. Generating and sellingÄ interim gasoline sulfur standards with
diesel fuel sulfur standards earlier than credits could provide small refinersÄ the environmental benefit of early
required under the small refiner Ä with funds to help defray the costs of Ä desulfurization of a significant volume
program described above. For some early NRLM compliance. Ä of NRLM diesel fuel. As such, a small
small refiners, the distribution system refiner choosing to use this option must
might limit the number of grades of iii. NRLM/Gasoline Compliance Option Ä produce a minimum volume of NRLM
diesel fuel that will be carried. Others The NRLM/Gasoline ComplianceÄ diesel fuel at the 15 ppm sulfur standard
might find it economically option is available to small refiners thatÄ by June 1, 2006. Each participating
advantageous to make 500 ppm or 15 produce greater than 95 percent of theirÄ small refiner must produce a volume of
ppm sulfur NRLM diesel fuel earlier NRLM diesel fuel at the 15 ppm sulfurÄ 15 ppm sulfur fuel that is at least 85
than required to prevent losing market standard by June 1, 2006 and elect notÄ percent of the annual average volume of
share. At least one small refiner has to use the provision described above toÄ non-highway diesel fuel it produced
indicated that it might decide to earn NRLM diesel fuel sulfur credits for Ä from 2003–2005. If the refiner began to
desulfurize its NRLM pool at the same this early compliance. Refiners choosingÄ produce gasoline in 2004 at the higher
time as it desulfurizes its highway this option will receive a modestÄ interim standard under this provision
diesel fuel, in June 2006, due to revision in their small refiner interim Ä but then either fails to meet the 15 ppm
limitations in its distribution system gasoline sulfur standards, beginningÄ sulfur standard for its NRLM diesel fuel
and to take advantage of economies of January 1, 2004. Specifically, theÄ by June 1, 2006 or fails to meet the 85
scale. applicable small refiner annual average Ä percent minimum volume requirement,
The NRLM Credit option allows small and per-gallon cap gasoline sulfur Ä the original small refiner interim
refiners to participate in the NRLM standards will be increased by 20 Ä gasoline sulfur standard applicable to
diesel fuel sulfur credit banking and percent for the duration of the interim Ä that refiner will automatically apply
trading program discussed earlier in this program. The interim program is Ä retroactively to 2004. In addition, the
section. Under this option, a small through either 2007 or 2010, depending Ä refiner must compensate for the higher
refiner may generate diesel fuel sulfur on whether the refiner extended the Ä gasoline sulfur levels by purchasing
credits by producing any volume of 500 duration of its interim gasoline sulfur Ä gasoline sulfur credits or producing an
ppm sulfur NRLM diesel fuel from standards by producing 15 ppm sulfur Ä equivalent volume of gasoline below the
crude oil prior to from June 1, 2006 highway diesel fuel by June 1, 2006, as Ä required sulfur levels. Under this
through May 31, 2010, and by provided under 40 CFR 80.552(c). In no Ä option, a small refiner could in effect
producing any volume from crude oil of case may the per-gallon gasoline sulfur Ä shift some funds from its gasoline sulfur
15 ppm sulfur NRLM diesel fuel from cap exceed 450 ppm, the highest level Ä program to accelerate desulfurization of
NRLM diesel fuel. While there would be sulfur provisions. These types of able to generate credits for ‘‘early’’
a small potential loss of emission transactions typically involve refiners production of lower sulfur diesels
reduction under the gasoline sulfur with approved small refiner status that during this two-year period.
program from fuel produced by the very are involved in potential or actual sales Nevertheless, we continue to believe
few small refiners that we believe would of the small refiner’s refinery, or involve these lead-time concerns are valid.
choose this second option, there are also the small refiner merging with another Failure to address them could lead to
environmental benefits gained from the refiner or purchasing another refinery unnecessary disruption to the diesel
production of 15 ppm sulfur diesel fuel (or other non-refining asset). We believe fuel market. Therefore, we are adopting
earlier than otherwise required. that these concerns are also relevant to a provision to provide an appropriate
the small refiner provisions described period of lead time for compliance with
iv. Relationship of the Options to Each the NRLM diesel fuel sulfur
below for the NRLM diesel fuel sulfur
Other requirements for situations in which a
program.
A small refiner may choose to use the refiner purchases any refinery owned by
NRLM Delay option, the NRLM Credit i. Large Refiner Purchasing a Small a small refiner, whether by purchase of
option or both in combination, since it Refiner’s Refinery the refinery or purchase of the small
has no requirement to produce 500 ppm The first type of transaction involves refiner entity. Refiners that acquire a
sulfur NRLM diesel fuel before June 1, a ‘‘non-small’’ refiner that wishes to refinery from an approved small refiner
2010, or 15 ppm sulfur NRLM diesel purchase a refinery owned by an will be provided 30 additional months
fuel before June 1, 2014. Thus any fuel approved small refiner. In some cases, from the date of the completion of the
that it produces from crude at or below the small refiner may not have purchase transaction (but no later than
the sulfur standards earlier than completed or even begun refinery June 1, 2010 for 500 ppm NRLM fuel
required will qualify for generating upgrades to meet the long-term fuel and June 1, 2014 for 15 ppm NRLM
credits. sulfur standards if it was using an fuel). During this interim period,
On the other hand, the NRLM/ interim small refiner compliance production at the newly-acquired
Gasoline Compliance option may not be provision. Under the gasoline sulfur and refinery may remain at the interim
used in combination with either the highway diesel fuel sulfur programs, sulfur levels that applied to that refinery
NRLM Delay option or the NRLM Credit once such a purchase transaction is for the previous small refiner owner
option, since a small refiner must completed, the ‘‘non-small’’ buyer does under the small refiner options
produce at least 85 percent of its NRLM not have the benefit of the small refiner discussed below. At the end of this
diesel fuel at the 15 ppm sulfur standard relief provisions that had applied to the period, the refiner must comply with
under the NRLM/Gasoline Compliance previous owner. the ‘‘non-small refinery’’ sulfur
option. The purchasing refiner would have to standards.
perform the necessary upgrades on the We received comments suggesting
d. How Do Refiners Apply for Small acquired refinery for it to meet the that the proposed 24 months of
Refiner Status? ‘‘non-small’’ sulfur standards. As the additional lead time would not be
A refiner applying for small refiner gasoline sulfur and highway diesel fuel adequate, and further, discussions with
status must provide the Agency with sulfur provisions existed prior to today’s several refiners indicated that in most
several types of information by action, such a refiner would be left with cases, 24 months would be inadequate.
December 31, 2004. The detailed very little or, in the case of the gasoline As discussed in section IV.F, we project
application requirements are sulfur program which has already a range of 27–39 months is needed to
summarized in section V.F.2 below. In begun, no lead time to bring the refinery design and construct a diesel
general, a potential small refiner must into compliance. The refiners that have hydrotreater. Therefore, in order to
own the refinery/refineries in question raised this issue have claimed that allow a reasonable opportunity for
and must provide the following refiners in this situation would not be complying, we are finalizing the
information for the parent company and able to immediately comply with the provision that 30 months of additional
all subsidiaries at all locations: (1) The ‘‘non-small refiner’’ standards upon lead time will be afforded. Thirty
average number of employees for all pay acquisition of the new refinery. These months should in most cases be
periods from January 1, 2002 through refiners claim that this could prevent sufficient for the new refiner-owner to
January 1, 2003; (2) the total corporate them from purchasing a refinery from a accomplish the necessary engineering,
crude oil capacity, which must be a small refiner and, as a result, this would permitting, construction, and start-up of
positive number; and (3) an indication severely limit the ability of small the necessary desulfurization
of which small refiner option the refiner refiners to sell such an asset. The equipment. However, if there are
intends to use (see section IV.B.1.c refiners that raised this issue requested instances where the technical
above). As with applications for relief additional lead time before the non- characteristics of its planned
under other fuel programs, applications small refiner sulfur standards take desulfurization project will require
for small refiner status under this rule effect. additional lead time, we have included
that are later found to contain false or We received comments on this issue provisions for the refiner to apply for up
inaccurate information will be void ab from two refiners. Both refiners to six months of additional time and for
initio. commented that lead time for refiners EPA to consider such requests on a case-
losing their small refiner status should by-case basis. Such an application must
e. The Effect of Financial and Other only be allowed for the case where a be based on the technical factors
Transactions on Small Refiner Status small refiner merges with, or acquires, supporting the need for more time and
and Small Refiner Relief Provisions another small refiner. Neither refiner should include detailed technical
Since the gasoline sulfur and highway supports allowing additional lead time information and projected schedules for
diesel fuel sulfur programs were for a large refiner that merges with or engineering, permitting, construction,
finalized, several refiners have raised acquires a small refiner. In addition, and startup. Based on information
concerns about how various financial these refiners also commented that it provided in such an application and
and other transactions could affect would be inappropriate to allow a small other relevant information, EPA will
implementation of the small refiner fuel refiner that receives this lead time to be decide whether additional time is
technically necessary and, if so, how with another entity, through the small non-small refiner that acquired a small
much additional time is appropriate. refiner itself purchasing another entity refiner’s refinery would. Therefore, the
However, we anticipate that in most or assets from another entity, or when additional lead time described above for
cases 30 months will be sufficient, since it ceases to process crude oil. However, non-small refiners purchasing a small
developing plans for compliance should an approved small refiner who exceeds refiner’s refinery will also apply to this
be expected to be a part of any purchase the employee or crude oil capacity situation. Thus, this 30 month lead time
decision. criteria without merger or acquisition, will apply to all of the refineries,
All existing small refiner provisions may retain its small refiner status for the existing or newly-purchased, that had
and restrictions, as described below, purposes of the complying with the previously been subject to the small
will also remain in place for that NRLM diesel fuel standards. refiner program, but would not apply to
refinery during the 30 months of Furthermore, in the sole case of a a newly-purchased refinery that is
additional lead time and any further merger between two approved small subject to the non-small refiner
lead time approved by EPA for the refiners we will allow such refiners to standards. Again, there would be no
purchasing refiner; including the per- retain their small refiner status for adverse environmental impact because
refinery volume limitation on the purposes of complying with the NRLM of the pre-existing relief provisions that
amount of NRLM diesel that may be diesel fuel program. Commenters applied to the newly-purchased small
produced at the small refiner standards. explained that additional financial refiner.
Furthermore, since the purpose of this resources would not typically be The issues discussed in this section
grace period is solely to provide time to provided in the case of a merger apply equally to the gasoline sulfur and
bring the refinery into compliance with between small refiners. In light of these highway diesel fuel sulfur programs.
the NRLM standards, refiners will not comments, we believe the justification Thus, we are also adopting the same
be allowed to generate credits for early for continued small refiner relief for the provisions relating to additional lead
compliance during this 30 month merged entity is valid. Small refiner time in cases of certain financial, or
period. There will be no adverse status for the two entities of the merger other, transactions for the small refiner
environmental impact of this provision, will not be affected, hence the original programs in the earlier fuel sulfur
since the small refiner would have compliance plans of the two refiners programs.
already been provided this same relief should not be impacted. Moreover, no In the proposal for today’s final rule,
prior to the purchase and this provision environmental detriment will result we invited comment on several other
is no more generous. from the two small refiners maintaining related provisions that were considered
their small refiner status within the during the development of this
ii. Small Refiner Losing Its Small rulemaking:
Refiner Status Due To Merger or merged entity as they would have likely
maintained their small refiner status (1) Instead of merely allowing small
Acquisition refiners a grace period to come into
had the merger not occurred.
Another type of transaction involves a Consistent with our intent in the compliance if they lose their small
refiner with approved small refiner gasoline sulfur and highway diesel fuel refiner status, we also asked for
status that later loses its small refiner sulfur programs to limit the use of the comment on whether or not such a
status because it exceeds the small small refiner hardship provisions, we small refiner should instead be allowed
refiner criteria. Under the gasoline also intended in the gasoline sulfur and to ‘‘grandfather’’ the small refiner relief
sulfur and highway diesel fuel sulfur highway diesel fuel sulfur programs that provisions for its existing refinery or
regulations, an approved small refiner an exceedance of corporate crude oil refineries. We did not receive any
that exceeds 1,500 employees due to capacity limit of 155,000 bpcd, due to specific comments on this issue and we
merger or acquisition will lose its small merger or acquisition, would be grounds are not finalizing this provision in
refiner status. We also intended for for disqualifying a refiner’s small refiner today’s action.
refiners that exceeded the 155,000 barrel status. However, we inadvertently failed (2) Regarding small refiners that
per calendar day crude capacity limit to include this second criterion as exceed the small refiner criteria due to
due to merger or acquisition to lose its grounds for disqualification in the the purchase of a non-small refiner’s
small refiner status and in this rule we regulations. In today’s action, we are refinery, we requested comment on
are amending the regulations to reflect resolving this error by including the whether or not the proposed additional
that criterion as well. This includes crude capacity limit, along with the lead time should apply to the purchased
exceedances of the employee or crude employee limit for both the gasoline refinery. We also requested comment on
capacity criteria caused by acquisitions sulfur and highway diesel fuel sulfur whether or not the refiner should be
of assets such as plant and equipment, programs, effective January 1, 2004. required to meet the non-small refiner
as well as acquisitions of business Thus, a refiner exceeding either standards on schedule at the purchased
entities. criterion due to merger or acquisition refinery, since the previous owner could
Our intent in the gasoline and will lose its small refiner status. The be assumed to have anticipated the new
highway diesel fuel sulfur programs, as exception to this would be in the case standards and taken steps to accomplish
well as the NRLM diesel fuel sulfur of merger only between two small this prior to the purchase. One refiner
program, has been and continues to be, refiners. We received comments commented that merger acquisition
limiting the small refiner relief supporting the allowance of additional flexibility for refineries that lose their
provisions to a small subset of refiners lead time for small refiners that lose small refiner status should be limited to
that are challenged, as discussed above. their small refiner status through a instances where a small refiner merges
At the same time, it is also our intent merger with, or acquisition of, another with another small refiner. They
to avoid stifling normal business small refiner. believed that any small refiner that loses
growth. Therefore, the regulations we We recognize that a small refiner that its small refiner status due to an
are adopting today will disqualify a loses its small refiner status because of acquisition of a non-small refiner’s
refiner from small refiner status if it a merger with, or acquisition of, a non- refinery should not be eligible for
exceeds the small refiner criteria small refiner would face the same type hardship relief. Similarly, another
through its involvement in transactions of lead time concerns in complying with refiner commented that a refiner should
such as being acquired by or merging the non-small refiner standards as a not retain small refiner status if it has
the financial resources to acquire section. We do not intend for the NRLM gasoline, low sulfur gasoline, and
additional refineries that increase program to undermine the benefits highway diesel fuel sulfur regulations. It
corporate-wide crude processing above afforded to small refiners under the is intended to provide refiners short-
155,000 bpd. We are not adopting any gasoline and highway diesel fuel sulfur term relief due to unanticipated
flexibility for the purchased refinery in programs, as described in the circumstances, such as a refinery fire or
this situation (except in the case of a comments. At the same time, however, a natural disaster, that cannot be
merger between two small refiners, as we want to preserve small refiner status reasonably foreseen now or in the near
discussed above). under today’s program only for those future.
businesses that meet the criteria Under this provision, a refiner may
f. Provisions for Approved Gasoline and seek a waiver to distribute NRLM diesel
Highway Diesel Fuel Small Refiners described above. Under the nonroad
proposal, a refiner with approved small fuel that does not meet the applicable
That Do Not Qualify for Small Refiner 500 ppm or 15 ppm sulfur standards for
Status Under Today’s Program refiner status under the highway diesel
fuel program but not the NRLM program a brief time period. An approved waiver
Some refiners that have approved would be required to produce 500 ppm of this type could, for example, allow a
small refiner status under the gasoline sulfur NRLM diesel fuel in 2007 and refiner to produce and distribute diesel
sulfur and highway diesel fuel programs both 15 ppm sulfur highway and NR fuel with higher than allowed sulfur
may not qualify for small refiner status diesel fuel in 2010. Under today’s final levels, so long as the other conditions
under today’s program if they have program, such a refiner may instead described below were met. Such a
grown through normal business skip the 2007 500 ppm interim sulfur request must be based on the refiner’s
operations and now exceed the standard for its NRLM diesel fuel, and inability to produce complying NRLM
qualification criteria for NRLM small meet the 15 ppm sulfur standard for diesel fuel because of extreme and
refiner status. One refiner commented both its highway and NR diesel fuel in unusual circumstances outside the
on the lack of a ‘‘grandfather’’ provision 2010 and LM diesel fuel in 2012. Such refiner’s control that could not have
in the nonroad proposal that would an approach will maintain the refiner’s been avoided through the exercise of
automatically continue small refiner flexibility under the highway program due diligence. The request must also
status to refiners already approved as by allowing it to delay diesel show that other avenues for mitigating
small refiners under the gasoline and hydrotreating investment until 2010, the problem, such as the purchase of
highway diesel fuel sulfur programs. while limiting its flexibility under the credits to be used toward compliance,
Without such a provision some refiners nonroad diesel program. had been pursued yet were insufficient.
could be approved small refiners under As with other types of regulatory relief
the gasoline sulfur and highway diesel g. Additional Provisions and Program established in this rule, this type of
fuel sulfur programs (because they grew Elements temporary waiver will have to be
through normal business expansions To reduce the burden on all refiners designed to prevent fuel exceeding the
and not through merger or acquisition) (including small refiners), we have 15 ppm sulfur standard from being used
but would not qualify under the NRLM chosen to finalize the designate and in 2011 and later model year nonroad
program because they now exceed the track approach, rather than the baseline engines.
criteria. As a consequence, the approach. Discussions with parties in The conditions for obtaining a NRLM
commenter argued that in some cases all parts of the distribution system led diesel fuel sulfur waiver are similar to
benefits afforded to such small refiners us to believe that this is the preferred those under the RFG, gasoline sulfur,
under the gasoline and highway diesel and highway diesel fuel sulfur
approach, as tracking is currently done
fuel sulfur programs could be negated. regulations. These conditions are
by parties throughout the distribution
Specifically, under the highway diesel necessary and appropriate to ensure that
system. We are also finalizing
rule they were allowed until 2010 before any waivers that are granted are limited
provisions to simplify the segregation,
needing to have diesel fuel in scope, and that refiners do not gain
marking, and dyeing requirements. In
hydrotreating capacity. Under the economic benefits from a waiver.
addition, we are finalizing provisions to
nonroad rule, they would have to do so Therefore, refiners seeking a waiver will
alleviate the concern raised by small
in 2007. Since it would only make sense be required to show that the waiver is
terminal operators regarding the heating
to invest for adequate 15 ppm capacity in the best public interest and that they:
oil marker. Terminals in parts of PADD
when they do invest, the nonroad (1) Were not able to avoid the
standards essentially would require 1 (Northeast/Mid-Atlantic Area) will not
nonconformity; (2) will make up the air
them to invest to bring all highway and have to add the marker to home heating
quality detriment associated with the
nonroad diesel to 15 ppm sulfur in oil. Therefore we expect that no
waiver; (3) will make up any economic
2007, eliminating the flexibility granted terminals inside of the Northeast/Mid-
benefit from the waiver; and (4) will
them in the highway rule. Furthermore, Atlantic Area will need to install
meet the applicable diesel fuel sulfur
the refiners’ clean fuel projects for low injection equipment. These provisions
standards as expeditiously as possible.
sulfur gasoline, highway diesel fuel, and are discussed in greater detail in section
NRLM diesel fuel could no longer be IV.D, below. b. Temporary Relief Based on Extreme
staggered. In fact, small refiners in such Hardship Circumstances
2. General Hardship Provisions
situations would be required to make In addition to the provision for short-
a. Temporary Waivers From NRLM term relief under extreme unforseen
investments for compliance with all
Diesel Fuel Sulfur Requirements in circumstances, we are finalizing a
three fuel programs in the same three to
Extreme Unforseen Circumstances provision for relief based on extreme
four year period, if not virtually all at
once. We are finalizing a provision which, hardship circumstances such as
We believe that a refiner who no at our discretion, will permit any circumstances that impose extreme
longer meets the criteria for small domestic or foreign refiner to seek a hardship and significantly affect a
refiner status, since it has successfully temporary relief from the NRLM diesel refiners ability to comply with the
grown through normal business fuel sulfur standards under certain rare program requirements by the applicable
operations, does not face the same level circumstances. This waiver provision is dates. This provision is also very similar
of hardship described earlier in this similar to provisions in the reformulated to those established under the gasoline
sulfur and highway diesel fuel sulfur with other relief provisions established —A plan demonstrating how the refiner
programs. Under the gasoline sulfur in this rule, any waiver under this would achieve the standards as
program, we have granted relief in the provision will be designed to prevent quickly as possible, including a
form of individual compliance plans to fuel exceeding the 15 ppm sulfur timetable for obtaining the necessary
five refiners. Under the highway diesel standard from being used in 2011 and capital, contracting for engineering
program, we have approved two. Each later model year nonroad engines. and construction resources, obtaining
plan was designed for the specific Providing short-term relief to those any necessary permits, and beginning
situation of that refiner. In all cases, the refiners that need additional time and completing construction.
companies would have experienced because they face hardship —A description of the market area for
severe hardship if temporary relief had circumstances facilitates adoption of an the refiner’s diesel fuel products.
not been granted. Moreover, some overall program that reduces NRLM —In some cases, it could also include a
refineries were at a high risk of shutting diesel fuel sulfur to 500 ppm beginning compliance plan for how the refiner’s
down without the relief. in 2007, and NRLM diesel fuel sulfur to diesel fuel will be segregated through
In developing today’s program, as 15 ppm in 2010 and 2012, for the to the end-user and information on
under our other fuel programs, we majority of the industry. However, we each of the end-users to whom its fuel
considered whether any refiners would do not intend for this waiver provision is delivered.
face particular difficulty in complying to encourage refiners to delay the We will consider several factors in
with the standards in the lead time planning and investments they would our evaluation of any hardship waiver
provided. As described earlier in this otherwise make. We do not expect to applications that we receive. Such
section, we concluded that, in general, grant temporary waivers that apply to factors include whether a refinery’s
small refiners would experience more more than approximately one percent of configuration is unique or atypical; the
difficulty in complying with the the national NRLM diesel fuel pool in proportion of non-highway diesel fuel
standards on time because they have any given year. production relative to other refinery
less ability to raise the capital necessary The regulatory language for today’s products; whether the refiner, its parent
for refinery investments, face action includes a list of the information company, and its subsidiaries are faced
proportionately higher costs because of that must be included in a refiner’s with severe economic limitations and
poorer economies of scale, and are less application for an extreme hardship steps the refiner has taken to attempt to
able to successfully compete for limited waiver. If a refiner fails to provide all of comply with the standards, including
engineering and construction resources. the information specified in the efforts to obtain credits towards
However, it is possible that other regulations as part of its hardship compliance. In addition, we will
refiners that are not small refiners may application, we will deem the consider the total crude oil capacity of
also face particular difficulty in application void. In addition, we may the refinery and its parent or subsidiary
complying on time with the sulfur request additional information as corporations, if any, in assessing the
standards required under today’s needed. Our experience to date shows degree of hardship and the refiner’s role
program. Therefore, we are including in that detailed technical and financial in the diesel market. Finally, we will
this rulemaking a provision which information from the companies seeking consider where the diesel fuel is
allows us, at our discretion, to grant relief has been necessary to fully intended to be sold in evaluating the
temporary waivers from the NRLM evaluate whether a hardship situation environmental impacts of granting a
diesel fuel sulfur standards based on a exists. The following are some examples waiver. Typically, because of EPA’s
showing of extreme hardship comprehensive evaluation of both
of the types of information that must be
circumstances. financial and technical information,
contained in an application:
The extreme hardship provision action on hardship applications can take
allows any domestic or foreign refiner to —The crude oil refining capacity and six or more months.
request relief from the sulfur standards fuel sulfur level(s) of each diesel fuel This extreme hardship provision is
based on a showing of unusual product produced at each of the intended to address unusual
circumstances that result in extreme refiner’s refineries. circumstances that should be apparent
hardship and significantly affect a —A technical plan for capital now or could emerge in the near future.
refiner’s ability to comply with either equipment and operating changes to Thus, refiners seeking additional time
the 500 ppm or 15 ppm sulfur NRLM achieve the NRLM diesel fuel sulfur under this provision must apply for
diesel fuel standards by either June 1, standards. relief by June 1, 2005, although we
2007, June 1, 2010, or June 1, 2012, —The anticipated timing for the overall retain the discretion to consider
respectively. The Agency will evaluate project the refiner is proposing and hardship applications later as well for
each application on a case-by-case basis, key milestones to ultimately produce good cause.
considering the factors described below. 100 percent of NRLM diesel fuel at
Approved hardship applications may the 15 ppm sulfur cap. 3. Provisions for Transmix Facilities
include compliance plans with relief —The refiner’s capital requirements for In the petroleum products
similar to the provisions for small each step of its proposed projects. distribution system, certain types of
refiners, which are described in detail —Detailed plans for financing the interface mixtures in product pipelines
above in section IV.B.1.c. Depending on project and financial statements cannot be added in any significant
the refiner’s specific situation, such demonstrating the nature of and quantity to either of the adjoining
approved delays in meeting the sulfur degree of financial hardship and how products that produced the interface.
requirements may be more stringent the requested relief would mitigate These mixtures are known as
than those allowed for small refiners, this hardship. This would include a ‘‘transmix.’’ The pipeline and terminal
but will not likely be less stringent. description of the overall financial industry’s practice is to transport
Given such an approval, we expect to situation of the company and its plans transmix via truck, pipeline, or barge to
impose appropriate conditions to: (1) to secure financing for the a facility with an on-site fractionator
Assure the refiner is making its best desulfurization project (e.g., internal that is designed to separate the
effort; and (2) minimize any loss of cash flow, bank loans, issuing of products. The owner or operator of such
emissions benefits from the program. As bonds, sale of assets, or sale of stock). a facility is called a ‘‘transmix
processor.’’ Such entities are generally crude or heavy oils. Therefore, under highway diesel fuel program, we have
considered to be a refiner under existing today’s final rule, transmix processors granted Alaska exemptions from both
EPA fuel regulations. may choose to continue to produce all the sulfur standard and dye provisions
Transmix processors, like of their highway diesel fuel to the 500 because of its unique geographical,
conventional refiners, are also currently ppm sulfur standard until 2010. They meteorological, air quality, and
subject to the ‘‘80 percent/20 percent’’ may further choose to continue to economic factors. 104 On December 12,
production requirement for 15 ppm and produce all of their NRLM diesel fuel as 1995, Alaska submitted a petition for a
500 ppm sulfur highway diesel fuel. high sulfur diesel fuel until June 1, permanent exemption for all areas of the
This requirement, however, is 2010, all of their NRLM diesel fuel to state served by the FAHS, that is, those
inconsistent with the inherent nature of the 500 ppm sulfur standard until June areas previously covered only by a
the transmix processors’ business. 1, 2014, and all of their LM diesel fuel temporary exemption. While
Unlike conventional refiners, transmix to a 500 ppm sulfur limit indefinitely. considering that petition, we started
processors refine batches of fuel that Transmix processors will be required work on a nationwide rule to consider
vary in volume and timing—largely to properly designate their fuel with the more stringent highway diesel fuel
unpredictably. Complying with set proper PTDs. Because the volume of requirements for sulfur content.
percentages of different highway diesel fuel involved will be small and the fuel In the January 18, 2001, highway
fuel sulfur grades would be very processed will already have been off- diesel rule EPA fully applied the 2007
difficult, probably resulting in either a specification, we believe that providing motor vehicle engine emission
need to purchase credits or to postpone this flexibility for transmix processors standards in Alaska. Based on factors
processing of some shipments. will have essentially no environmental unique to Alaska, we provided the state
Transmix processors commented that it impact and will not affect the efficient with: (1) An extension of the exemption
would not be appropriate to have any functioning of the NRLM diesel fuel from the 500 ppm sulfur fuel standard
additional restrictions, beyond those program or the existing highway diesel until the effective date of the new 15
based on sulfur content, imposed on fuel program. Rather, this approach will ppm sulfur standard for highway diesel
their ability to market the fuel that they allow fuel volume to remain in the fuel in 2006; (2) an opportunity to
produce. They stated that the highway, NRLM, or LM (as applicable request an alternative implementation
implementation of other restrictions, based on time frame) markets that might plan for the 15 ppm sulfur diesel fuel
such as those under the highway diesel otherwise be forced into the heating oil program; and (3) a permanent
program’s 80/20 requirement, would market. exemption from the diesel fuel dye
force them to ship large volumes of provisions. In response to these
blendstocks back to refineries by truck, C. Special Provisions for Alaska and the provisions in our January 18, 2001,
resulting in tank lock-outs that could Territories highway rule, Alaska informed us that
cascade upstream though the 1. Alaska areas served by the FAHS, i.e.,
distribution system potentially communities on the connected road
interfering with pipeline operations. 103 The nationwide engine emission system or served by the Alaska state
Furthermore, transmix processors do standards established today apply to all ferry system (‘‘urban’’ areas), would
not have the ability to change the nature NR engines throughout Alaska. The follow the nationwide requirements. 105
of their products, as their processing nationwide NRLM diesel fuel sulfur Diesel fuel produced for use in areas of
equipment consists only of a distillation standards and implementation dates Alaska served by the FAHS will
column to separate the blendstocks. apply to NRLM diesel fuel used in the therefore be required to meet the same
This simple refinery configuration areas of Alaska served by the federal aid requirements for highway diesel fuel as
further limits their ability to install and highway system (FAHS). In this final diesel fuel produced for the rest of the
operate a distillate hydrotreater. The rule, EPA is not finalizing fuel sulfur nation. For the rural parts of the state—
commenters added that the sulfur standards and implementation areas not served by the FAHS—Alaska
content of the slate of fuel products that deadlines for NRLM diesel fuel used in requested that highway diesel fuel not
they produce is completely dependant the areas of Alaska not served by the be subject to the highway diesel fuel
on feed material that they receive, and FAHS (i.e., the ‘‘rural’’ areas). They will sulfur standard until June 1, 2010.
that it is not feasible for them to install be addressed in a separate rulemaking to Between 2006 and 2010, the rural
desulfurization equipment. We agree allow EPA to address the requirements communities would choose their own
that it is not feasible for transmix for highway and NRLM diesel fuel in fuel management strategy, except that
processors to alter the sulfur content of the rural areas in the same rulemaking. all 2007 model year and newer diesel
the fuels that they produce and that This final rule does, however, adopt the vehicles would require ultra-low sulfur
limiting the market for these fuels could prohibition in the rural areas on the use diesel fuel. Beginning June 1, 2010, all
potentially lead to disruptions in the of high sulfur (greater than 15 ppm) highway diesel fuel in the rural areas
fuel distribution system. diesel fuel in model year 2011 and later would be subject to the 15 ppm sulfur
In light of this disproportionate nonroad engines, which will be highway diesel fuel sulfur standard. 106
burden on transmix processors, today’s manufactured to operate on ultra-low
final rule removes the restriction on the sulfur diesel fuel. 104 Copies of information regarding Alaska?s
volume of highway or NRLM diesel fuel petition for exemption, subsequent requests by
they produce, if they produce diesel fuel a. How Do the Highway Diesel Engine Alaska, public comments received, and actions by
according to typical operational Standards, the Highway Diesel Fuel EPA are available in public docket A–96–26.
practices involving the separation of Standards, and Implementation 105 Letter and attached document to Jeffrey
transmix and not, for example, by Deadlines Apply in Alaska? Holmstead of EPA from Michele Brown of the
Alaska Department of Environmental Conservation,
blending of blendstocks or processing Unlike the rest of the nation, Alaska dated April 1, 2002. The communities on the
is currently exempt from the 500 ppm connected road system or served by the Alaska
103 In a tank lock out situation a storage tank can
sulfur standard for highway diesel fuel State ferry system are listed in the attached
no longer accept product from upstream in the document.
distribution system because there is not sufficient
and the dye provisions for diesel fuel 106 Letter and attached document to Jeffrey
outlet for the product it holds. A tank lock our not subject to this standard. Since the Holmstead of EPA from Ernesta Ballard of the
downstream can quickly propagate upstream. beginning of the 500 ppm sulfur Continued
EPA intends to propose and request along with the rest of the nation implementation of refiner product
comment on an amendment to the beginning June 1, 2010 and June 1, designations, labeling of fuel pumps,
highway diesel sulfur rule to 2012, respectively. retailer education, and rapid transition
incorporate the rural area transition The state, in its comments on the to ULSD would ensure that 500 ppm
plan submitted by the state. proposal, supports today’s action for the sulfur diesel fuel is used in NRLM
urban areas described above. One equipment from 2007–10 and that 15
b. What NRLM Diesel Fuel Standards refiner in Alaska commented that we
Are We Establishing for Urban Areas of ppm sulfur diesel fuel is used in
should implement a one-step approach nonroad equipment after 2010.
Alaska? requiring 15 ppm sulfur diesel fuel In section IV.D below, we discuss the
Since Alaska is currently exempt from starting in 2010. The refiner indicated provisions that we are adopting for the
the 500 ppm sulfur standard for that, due to the limited NRLM market, State of Alaska that will allow us to
highway diesel fuel, we also considered the benefits of introducing 500 ppm enforce the NRLM diesel fuel program
exempting Alaska from the 500 ppm sulfur diesel fuel in 2007 would be without requiring the fuel marker.
sulfur step of the proposed NRLM minimal. Also, the distribution system
standards. However, despite the in Alaska is not capable of handling the c. Why Are We Deferring Final Action
exemption, officials from the state of two grades of diesel fuel that would be on NRLM Diesel Fuel Standards for
Alaska have informed us that some 500 required between 2007 and 2010, thus Rural Areas of Alaska?
ppm sulfur diesel fuel is nevertheless 15 ppm sulfur fuel would be distributed We are deferring final action on the
being marketed in many parts of Alaska. as NRLM. We agree that the distribution fuel sulfur standards and
Market forces have brought the prices system in Alaska is limited compared to implementation deadlines for the rural
for 500 ppm diesel fuel down such that the rest of the nation, and that areas of Alaska. We proposed to
it is now becoming competitive with consumption of diesel fuel by NRLM permanently exempt NRLM diesel fuel
higher sulfur, uncontrolled diesel fuel. applications in Alaska is small. used in the rural areas from fuel content
Assuming this trend continues, However, as previously discussed, we standards, except that diesel fuel used
requiring that NRLM diesel fuel be expect that some 500 ppm sulfur diesel in 2011 and later model year nonroad
produced to 500 ppm beginning June 1, fuel will be available due to market engines would have had to meet the
2007 would not appear to be unduly forces, and that 15 ppm sulfur highway sulfur content standard of 15 ppm
burdensome. Even if 500 ppm diesel diesel fuel will be available beginning in sulfur. However, this proposed action is
fuel were not available in Alaska today, 2006 in the urban areas. Thus, requiring inconsistent with the action requested
our expectation is that compliance with 500 ppm sulfur diesel fuel (or 15 ppm by the state in its comments to the
the highway program described above sulfur diesel fuel as a substitute) for the proposal. It is also inconsistent with the
will likely result in the transition of all limited NRLM applications beginning in state’s alternative implementation plan
of the urban area highway diesel fuel 2007 does not appear to create any for highway diesel fuel in rural Alaska,
distribution system to 15 ppm sulfur undue burden on the fuel supply or the which was submitted after publication
beginning in 2006. It could prove very distribution system in urban Alaska. of the proposal.
challenging for the distribution system During the development of the We intend to issue a supplemental
in some of the areas to segregate a 500 original 500 ppm sulfur highway diesel proposal that would address both
ppm sulfur grade of NRLM from a 15 fuel standards in the early 1990’s, highway and NRLM diesel fuel sulfur
ppm sulfur grade of highway and an refiners and distributors in Alaska standards for Alaska’s rural areas. This
uncontrolled grade for other purposes. expressed concern that if Alaska were proposal will address the comments
We believe economics would determine required to dye its non-highway diesel submitted by the state, as well as the
whether the distribution system would fuel red along with the rest of the state’s alternative implementation plan
handle the new grade of fuel or country, residual dye in tanks or other
for highway diesel fuel.
substitute 15 ppm sulfur highway diesel equipment would be enough to
fuel for NRLM applications. Thus, in the contaminate and disqualify Jet-A 2. American Samoa, Guam, the
2007 to 2010 time frame, the NRLM kerosene used as aviation fuel. Since Commonwealth of Northern Mariana
market in some urban areas might be much of the diesel fuel in Alaska is No. Islands, and Puerto Rico
supplied with 500 ppm sulfur diesel, 1 and is indistinguishable from Jet-A a. What Provisions Apply in American
and in other areas might be supplied kerosene, not only would tanks and Samoa, Guam, and the Commonwealth
with 15 ppm sulfur diesel. For this transfer equipment have to be cleaned, of Northern Mariana Islands?
reason, today’s action applies the 500 but separate tankage would be needed.
ppm sulfur standard for NRLM diesel Consequently, we granted Alaska As we proposed, we are excluding
fuel to Alaska’s urban areas. temporary exemptions from the dye American Samoa, Guam and the
Regardless of what occurs prior to requirement and in the January 18, Commonwealth of the Northern Mariana
2010, we anticipate that 15 ppm sulfur 2001, highway diesel rule granted the Islands (CNMI) from the NRLM diesel
highway diesel fuel will be made state a permanent exemption. fuel sulfur standards and associated
available in urban areas of Alaska by The proposed use of a marker for requirements. We also are excluding
this time frame. The 2007 and later heating oil in the 2007–10 time period these territories from the tier 4 nonroad
model year highway fleet will be presents similar concerns in Alaska’s engine emissions standards, and other
growing, demanding more and more distribution system. In response to our requirements associated with those
supply of 15 ppm sulfur diesel fuel. request for comments on this issue, the emission standards. The territories will
Adding nonroad volume to this would state and refiners indicated that Alaska’s continue to have access to new nonroad
not appear to create any undue burden. system is not capable of accommodating diesel engines and equipment using pre-
Thus, today’s action also applies the 15 dyes or markers and segregation. The tier 4 technologies, at least as long as
ppm sulfur standard for NR and LM priority of the state and fuel industry is manufacturers choose to market those
diesel fuel in the urban areas of Alaska, to keep dyes and markers out of the fuel technologies. In the future, if
stream to prevent contamination of Jet- manufacturers choose to market
Alaska Department of Environmental Conservation, A and facilitate movement of the fuel. nonroad diesel engines and equipment
dated June 12, 2003. The comments suggested that only with tier 4 emission control
technologies, we believe the market will Commonwealth of the Northern Mariana its claims. We have no reason to believe
determine if and when the territories Islands petitioned us for an exemption that the costs of the NRLM diesel fuel
will make the investment needed to under section 325 of the CAA from the program in Puerto Rico will be
obtain and distribute the diesel fuel sulfur requirement under section 211(i) significantly greater than that of the U.S.
necessary to support these technologies. of the CAA and associated regulations at For example, Puerto Rico is close to the
We are also requiring that all nonroad 40 CFR 80.29. We subsequently granted U.S. mainland, and to South American
diesel engines and equipment for these the petitions.107 Consistent with this and Central American suppliers of fuel
territories be certified and labeled to the decision, in our January 18, 2001 to the U.S. mainland, and therefore has
applicable requirements—either to the highway rule (66 FR 5088), we ready access to nearby fuel supplies that
previous-tier standards and associated determined that the 2007 heavy-duty meet U.S. requirements. Similar to the
requirements under this exclusion, or to engine emission standards and 2006 fuel distribution system in the rest of
the Tier 4 standards and associated diesel fuel sulfur standard would not the country, the fuel distribution system
requirements applicable for the model apply to these territories. in Puerto Rico is geared to separate fuel
year of production under the Compliance with the NRLM diesel handling and storage facilities for
nationwide requirements of today’s fuel sulfur standards would result in highway and non-highway diesel fuels.
action. The engines would still be major economic burden on the Today’s rule will require additional
emissions warranted, as otherwise territories. All three of these territories segregation for the NRLM diesel fuels,
required under the CAA and EPA lack internal petroleum supplies and but no differently for Puerto Rico than
regulations. Special recall and warranty refining capabilities and rely on long for the U.S. Nevertheless, to avoid that
considerations due to the use of distance imports. Given their remote additional fuel segregation, Puerto Rico
excluded high sulfur fuel would be the location from Hawaii and the U.S. could substitute highway fuel for use in
same as those for Alaska during its mainland, most petroleum products are NRLM diesel engines and equipment.
exemption and transition periods for imported from east rim nations, We also believe that the important air
highway diesel fuel and for these particularly Singapore. Australia, the quality benefits to be realized by today’s
territories for highway diesel fuel (see Philippines, and certain other Asian rule for the four million people in
66 FR 5086, 5088, January 18, 2001). countries are beginning to consider and Puerto Rico should not be significantly
To protect against circumvention of in some cases implement lower sulfur different than those for the rest of the
the emission requirements applicable to diesel fuel standards. However, it is not country. Consequently, today’s rule
the rest of the U.S., we are restricting clear that supply, especially of 15 ppm includes Puerto Rico in the NRLM
the importation of nonroad engines and sulfur diesel fuel, would be possible to diesel fuel program.
equipment from these territories into the these territories.
rest of the U.S. After the 2010 model D. NRLM Diesel Fuel Program Design
Furthermore, compliance with new 15
year, nonroad diesel engines and ppm sulfur requirement for highway In addition to specifying the sulfur
equipment certified under this diesel fuel beginning in 2006 and standards and the implementation dates
exclusion for sale in American Samoa, today’s 15 ppm sulfur requirement for when the standards take effect, the
Guam and the Commonwealth of the NRLM diesel fuel beginning in 2010 (or diesel fuel program compliance
Northern Mariana Islands will not be the 500 ppm sulfur requirement for provisions must be designed and
permitted entry into the rest of the U.S. NRLM diesel fuel beginning 2007) structured carefully to achieve the
would require construction of separate overall principles of the program.
b. Why Are We Treating These
storage and handling facilities for a Specifically, the health and welfare
Territories Uniquely?
unique grade of diesel fuel for highway benefits of the NRLM diesel fuel and the
Like Alaska, these territories are and nonroad purposes, or use of 15 ppm highway diesel programs, and the need
currently exempt from the 500 ppm sulfur diesel fuel for all diesel for widespread availability of 15 ppm
sulfur standard for highway diesel fuel. applications to avoid segregation. Either sulfur highway diesel fuel must be
Unlike Alaska, they are also exempt of these alternatives would require maintained. The program benefits and
from the new highway diesel fuel sulfur importation of 500 and 15 ppm sulfur fuel availability will only happen if the
standard effective in 2006 and the new diesel fuel from Hawaii or the U.S. NRLM diesel fuel program is designed
highway vehicle and engine emission mainland, and would significantly add such that the amount of 15 ppm sulfur
standards effective beginning in 2007 to the already high cost of diesel fuel in fuel expected to be produced under the
(see 66 FR 5088, January 18, 2001). these territories, which rely heavily on highway diesel fuel program is in fact
Section 325 of the CAA provides that produced and that 500 ppm highway
U.S. support for their economies. At the
upon request of Guam, American fuel is not overproduced. Likewise, the
same time, it is not clear that the
Samoa, the Virgin Islands, or the benefits of the NRLM diesel fuel sulfur
environmental benefits in these areas
Commonwealth of the Northern Mariana standards adopted today will only be
would warrant this cost. Therefore, we
Islands, we may exempt any person or achieved if the program is designed to
are not applying the fuel and engine
source, or class of persons or sources, in ensure that the volume of diesel fuel
standards to these territories.
that territory from any requirement of The Caribbean Petroleum Corporation consumed by NRLM diesel engines is
the CAA, with some specific exceptions. (CPC) commented that the proposed matched by the supply of NRLM diesel
The requested exemption could be nonroad diesel rule would result in a fuel produced to the appropriate low
granted if we determine that compliance major economic burden for Puerto Rico, sulfur levels. At the same time,
with such requirement is not feasible or the environmental benefits do not promoting the efficiency of the
is unreasonable due to unique warrant the cost, and that Puerto Rico distribution system calls for fungible
geographical, meteorological, or should be exempt. However, the CPC distribution of physically similar
economic factors of the territory, or did not include any cost or products, and minimizing the need for
other local factors as we consider environmental information to support product segregation.
significant. Prior to the effective date of As discussed below, the situation
the current highway diesel fuel sulfur 107 See 57 FR 32010, July 20, 1992 for American faced in 1993 when EPA first regulated
standard of 500 ppm, the territories of Samoa; 57 FR 32010, July 30, 1992 for Guam; and the sulfur content of highway diesel fuel
American Samoa, Guam and the 59 FR 26129, May 19, 1994 for CNMI. parallels some of the issues that EPA
needed to address in today’s rule. Prior fungible distribution of highway and small refiners and/or through the use of
to the implementation of the 500 ppm NRLM diesel fuel with the same sulfur credits. This could substantially reduce
sulfur standard for highway diesel fuel level risks the loss of important benefits the environmental benefits of today’s
in 1993, most No. 2 distillate fuel was of the highway program. For example, if rule.
produced to essentially the same a refiner produced all 500 ppm sulfur After 2010, when the 15 ppm sulfur
specifications, shipped fungibly, and fuel and designated it as NRLM diesel standard for NR diesel fuel goes into
used interchangeably by highway diesel fuel, that refiner would have no effect, small refiner and credit NR fuel
engines, nonroad diesel engines, obligation to produce any 15 ppm sulfur must meet a 500 ppm standard.
locomotive and marine diesel engines, highway diesel fuel. Without an Therefore, after 2010 NRLM diesel fuel
and heating oil applications. Beginning effective way of limiting the use in the can be distinguished from high sulfur
in 1993, highway diesel fuel was highway market of 500 ppm sulfur (greater than 500 ppm) home heating
required to meet a 500 ppm sulfur cap diesel fuel produced as NRLM diesel fuel based on sulfur content. However,
and was segregated from other distillate fuel, much more 500 ppm sulfur fuel 500 ppm NR (small refiner, credit)
fuels as it left the refinery by the use of could, and likely would find its way produced from June 1, 2010 through
a visible level of dye solvent red 164 in into the highway market than would May 31, 2012, and 500 ppm NRLM
all non-highway distillate. At about the otherwise happen under the current (small refiner, credit) diesel fuel
same time, the Internal Revenue Service highway program. This would displace produced from June 1, 2012 through
(IRS) similarly required non-highway 15 ppm sulfur diesel fuel that would May 31, 2014, could not be
diesel fuel to be dyed red to a much have otherwise been produced. This distinguished from heating oil produced
higher concentration prior to retail sale likely series of events would circumvent to meet a similar 500 ppm sulfur limit.
to distinguish it from highway diesel the intent of the highway program’s Likewise, from June 1, 2010 to June 1,
fuel for excise tax purposes. Dyed non- TCO and sacrifice some of the resulting 2012, 500 ppm NR (small refiner, credit)
highway fuel is exempt from this tax. PM and SO2 emission benefits of the diesel fuel and LM diesel fuel need to
This splitting of the distillate pool overall highway diesel program. If this be distinguished from each other, so
necessitated changes in the distribution occurred to any significant degree, it that diesel fuel produced as 500 ppm
system to ship and store the now could also undermine the integrity of LM is not later misdirected to the NR
distinct products separately. In some the highway program by threatening the diesel market. Such misdirected 500
parts of the country where the costs to availability of 15 ppm sulfur diesel fuel ppm sulfur LM diesel fuel would be
segregate non-highway diesel fuel from nationwide for the vehicles that need it. indistinguishable from legal 500 ppm
highway diesel fuel could not be This is no longer a concern after 2010, sulfur NR diesel fuel, reducing the
justified, both fuels have been produced when all highway diesel fuel is required environmental benefits of today’s rule.
to highway specifications.108 to meet a 15 ppm sulfur standard. These various 500 ppm fuels could not
be distinguished based on sulfur level.
1. Requirements During the First Step of The second reason is to maintain the As previously discussed, the situation
the Fuel Program integrity of the NRLM diesel fuel which was faced in 1993 regarding the
program, while allowing the efficient need to differentiate 500 ppm sulfur
EPA is adopting specific compliance
distribution of NRLM diesel fuel and highway diesel fuel from other diesel
provisions during the first step of
heating oil where they have similar fuel is similar to the need today to
today’s NRLM diesel fuel sulfur control
sulfur levels. By establishing new sulfur differentiate highway diesel fuel, NRLM
program for three reasons. The first is to
standards for NRLM diesel fuel but not diesel fuel, and heating oil.
maintain the integrity of the highway
heating oil, today’s program creates the The third reason is to maintain the
diesel program, while allowing the
need to distinguish the fuel used for integrity of the anti-downgrading
efficient distribution of highway and
these two purposes. Currently, there is requirements in the highway diesel
NRLM diesel fuel. Since 500 ppm sulfur
no grade of diesel fuel which is program. The highway diesel program
highway diesel fuel allowed under the
produced and marketed as a requires that each entity in the
highway diesel fuel program’s
distinguishable grade for NRLM diesel distribution system downgrade no more
Temporary Compliance Option (TCO)
engine uses. It is typically produced and than 20 percent of the 15 ppm sulfur
and NRLM diesel fuel meeting today’s
shipped fungibly with other distillate highway diesel fuel for which it
500 ppm sulfur standard will be
used for heating oil purposes, and it is assumes custody to 500 ppm sulfur
physically the same, it would be
all dyed red in accordance with EPA highway diesel fuel. These provisions
impossible to maintain the benefits and
and IRS regulations. Because today’s are necessary to ensure the widespread
program integrity of the highway diesel
rule includes small refiner and credit availability of 15 ppm sulfur diesel fuel
fuel program without some means of
provisions that allow the limited for use in model year 2007 and later
differentiating highway diesel fuel from
production of high sulfur (greater than highway vehicles, in which the use of
NRLM diesel fuel.
500 ppm) NRLM diesel fuel through 15 ppm sulfur fuel is essential to
Continuing the current practice of
2010, it is not possible to rely on sulfur facilitate the projected emissions
dyeing NRLM diesel fuel at the refinery
content alone to differentiate NRLM benefits of the highway program. The
gate and requiring that it be segregated
diesel fuel from heating oil during the highway program placed no restrictions
throughout the distribution system is
first step of the program. Without on the volume of highway diesel fuel
not a practical way to differentiate
adequate controls, a refiner could that could be downgraded to NRLM
NRLM diesel fuel from highway fuel. At
choose not to desulfurize any of its fuel diesel fuel. Under the proposed rule
the same time, allowing the unrestricted
that is destined for the NRLM diesel fuel there would be no way to distinguish
108 Diesel fuel produced to highway specifications market, instead designating that volume 500 ppm sulfur NRLM diesel fuel from
but used for non-highway purposes is referred to as as heating oil at the refinery gate. This 500 ppm sulfur highway diesel fuel
‘‘spill-over.’’ It leaves the refinery gate and is fuel, ostensibly manufactured for use as downstream of the refinery. Therefore,
fungibly distributed as if it were highway diesel heating oil could be misdirected for use to preserve the integrity of the highway
fuel, and is typically dyed at a point later in the
distribution system. Once it is dyed it is no longer
in NRLM diesel equipment, and would program, the proposal would have made
available for use in highway vehicles, and is not be indistinguishable from legal high the highway program’s anti-downgrade
part of the supply of highway fuel. sulfur NRLM diesel fuel produced by requirements more stringent by also
restricting downgrades to 500 ppm essential, since segregating the fuels designate and track approach amplified
sulfur NRLM diesel fuel. We received could result in substantial additional potential concerns regarding whether
several negative comments on this transportation costs and necessitate the approach might reduce the volume
proposed restriction. The compliance additional storage tanks throughout the of 15 ppm sulfur diesel fuel required to
and record keeping requirements system. be produced under the highway diesel
finalized to address the two concerns The NPRM invited comment on two program, leading to a reduction in the
discussed above, can be utilized to alternative approaches to ensure that environmental benefits of the highway
facilitate the implementation of the refiner production of 15 ppm sulfur diesel program and calling into question
highway program’s anti-downgrading highway diesel fuel met the highway the availability of 15 ppm sulfur diesel
requirements without the need to rule’s 80/20 requirement; the ‘‘refiner fuel. We were also concerned about
further restrict downgrading. As a baseline’’ approach, and the ‘‘designate whether this approach would place too
result, today’s rule also contains several and track’’ approach. The baseline much burden on the numerous entities
modifications which clarify the anti- approach is essentially a constraint on in the fuel distribution system, as
downgrading provisions of the highway the sulfur levels of the various distillate compliance was focused on downstream
diesel program. fuel products a refiner produces, based parties. While the designate and track
The requirements described below on historical production volumes. Fuel approach provided greater production
will help ensure that the projected with similar sulfur levels could then be flexibility to refiners than the baseline
benefits of the highway diesel program fungibly distributed with only limited approach, it appeared to increase the
and of today’s NRLM diesel program are controls on the downstream distribution burden and restrictions on downstream
achieved. system. The designate and track parties.
approach requires that a refiner Of the approaches discussed in the
a. Ensuring Refiner Production Volumes
designate into which market discrete NPRM, we expected that the baseline
of 15 ppm Sulfur Highway Diesel Fuel
volumes of the distillate fuels it approach would provide the best
Are Consistent With the Highway Rule’s
produces must be sold, without any mechanism to achieve the fuel program
80/20 Requirement
consideration of historical production goals described at the beginning of this
To avoid adding unnecessary cost to volumes. The fuel must then be tracked section. Since the proposal, we have
the fuel distribution system, we through the distribution system and comprehensively evaluated the
proposed that the current requirement sold only for its designated purpose (or advantages and disadvantages of both
of dyeing non-highway distillate fuels at a purpose that requires less control). As approaches. Based on this review, we
the refinery gate become voluntary as of with the baseline approach, diesel fuel now believe that a baseline approach
June 1, 2006.109 As discussed in the with similar sulfur levels could be would produce significant adverse
proposal, continuing to require that fungibly shipped up to the point of problems because of its overly
NRLM diesel fuel and heating oil distribution from a terminal where off- restrictive impact on the ability of fuel
contain a visible trace of red dye at the highway diesel fuel must be dyed red producers and distributors to efficiently
refinery gate would allow for simple pursuant to IRS requirements to indicate respond to the myriad and daily needs
enforcement of the highway standards its tax exempt status. of the markets for highway and NRLM
throughout the duration of the highway We proposed the baseline approach diesel fuel. Implementation of the
program’s TCO. Clear, undyed diesel because, in the absence of a red dye approach could also produce an
fuel would have to meet the 80/20 ratio requirement at the refinery-gate for unintended bias that would tend to
of 15 ppm to 500 ppm sulfur highway NRLM diesel fuel, we expected that it reduce the benefits of the highway
diesel fuel, and dyed fuel could only be would: (1) Allow for the fungible program and reduce the availability of
used in NRLM diesel equipment or as distribution of 500 ppm sulfur highway 15 ppm sulfur highway diesel fuel. At
heating oil. Continuing the current dye and NRLM diesel fuel; (2) ensure the the same time, our review of the
provisions would therefore ensure that enforceability of the highway diesel fuel approaches shows that the designate
the intended benefits of the highway and NRLM diesel fuel standards; (3) and track approach can be implemented
program are achieved. However, maintain the projected production in an enforceable manner and likely
maintaining this dye distinction would volume of 15 ppm sulfur highway diesel would not cause a reduction in the
also require segregation of a new grade fuel; (4) allow refinery production of environmental benefits of the highway
of dyed 500 ppm sulfur NRLM diesel 500 ppm sulfur NRLM diesel fuel and diesel program or adversely impact the
fuel throughout the entire distribution heating oil to remain flexible to meet widespread availability of 15 ppm
system. The costs of requiring market demand; and (5) enable the sulfur highway diesel fuel. Our
segregation of two otherwise identical efficient distribution of diesel fuel while evaluation of these alternate approaches
fuels throughout the entire distribution imposing the least burden on the parties is discussed in more detail in the
system could be quite substantial.110 in the fuel production and distribution following sections.
Comments on the proposed rule system. In the proposal, we also
discussed how a refiner’s baseline i. Proposed Refiner Baseline Approach
confirmed EPA’s assessment that the
ability of the fuel distribution system to would be set, and invited comment on Under the refiner baseline approach,
distribute these fuels fungibly is ways to account for changes refiners we proposed that from June 1, 2007
might make from their historical through May 31, 2010, any refiner or
109 The IRS requirements concerning dyeing of production practices in response to the importer could choose to distribute its
non-highway fuel prior to sale to consumers are not highway diesel program. 500 ppm sulfur NRLM and highway
changed by this rulemaking. In the NPRM, we expressed concerns diesel fuels fungibly without adding red
110 Under the highway program the potential
exists to add a third grade of diesel fuel in an

that a designate and track approach dye at the refinery gate. Refiners and
estimated 40 percent of the country, and we would raise significant workability and importers who elect to distribute these
projected one-time tankage and distribution system enforceability issues and therefore fuels fungibly would need to establish a
costs of $1.05 billion to accomplish this. Using might not maintain the integrity of non-highway distillate baseline, defined
similar assumptions, to add a second 500 ppm
grade nationwide would cost in excess of $2 billion.
highway and NRLM diesel fuel sulfur as a percentage of its total distillate fuel
This assumes that the capability exists to add such programs. Our concerns about the production volume based on historical
new tankage. workability and enforceability of a production data. For future production
purposes, this percentage of the volume In the case of a spike in heating oil meeting the market demand for such
of diesel fuel produced would have to demand due to an unusually cold fuels. At the same time, it would not be
either meet the 500 ppm sulfur NRLM winter, the baseline approach would possible for EPA to reduce the ability of
diesel fuel sulfur standard or be marked limit a refiner’s ability to produce other refiners to produce non-highway
as heating oil. All the remaining additional volumes of high sulfur fuel who may have lost these markets.
production of diesel fuel would have to distillate fuel beyond the volume Therefore, for such alternatives to be
meet the requirements of the highway established under its baseline. Refiners effective in responding to changing
fuel program (i.e., 80 percent of this fuel that were limited in their ability to market conditions, an unintended
would have to meet a 15 ppm sulfur produce additional high sulfur fuel downward bias would result regarding
cap). Refiners not wishing to participate could choose to supply low sulfur diesel the required production of 15 ppm
in the baseline approach would have to fuel to the heating oil market. However, sulfur highway diesel fuel.
dye all of their 500 ppm sulfur NRLM they may not have sufficient Even without any changes we
diesel fuel at the refinery. However, we hydrotreating capacity to do so. This discovered from the highway diesel
anticipated that few refiners would opt could limit their ability to respond to a program pre-compliance reports that the
to dye 500 ppm sulfur NRLM diesel supply shortage. proposed baseline approach has a
fuel, other than the volumes that they The proposed rule suggested various downward bias that could result in a
dispense from their own racks, since potential modifications to the baseline reduction in the volume of 15 ppm
this would eliminate the ability to approach to address refiner concerns sulfur diesel fuel produced under the
fungibly distribute 500 ppm sulfur regarding the associated constraints on highway diesel program.111 We
highway and NRLM diesel fuels. the slate of fuels they produce. We proposed that refiners could choose to
Since the publication of the proposed received comments on the potential calculate their off-highway baseline
rule, we have developed a better modifications discussed in the NPRM as using either an average of 2003 through
understanding of refiner concerns about well as other potential changes to the 2005 production data or 2006
the constraints associated with the baseline approach. Some commenters production data. Providing the option
baseline approach. Specifically, it is suggested that if EPA were to finalize a for a 2006 baseline was necessary
now clear that individual refiners would baseline approach, refiners should be because a number of refiners will be
be significantly constrained by the able to apply to EPA for a yearly changing the slate of fuels that they
baseline approach from efficiently adjustment to their baseline based on produce in response to the highway
responding to changes in contract annual demand forecasts. Even with diesel rule which becomes effective in
arrangements with their clients and such flexibility, refiners still concluded 2006. While the highway diesel pre-
changes in market demands. Refiners that in many cases they would likely be compliance reports indicate an overall
commented that they win and lose forced to dye their fuel instead. For fuel increase in production volume, they
contracts on a daily basis and that distributors, having refiners dye their also indicate that 40 percent of highway
depending on which contracts they NRLM diesel fuel presented an diesel refiners will decrease the volume
secure, they may not be able to comply unacceptable situation due to the need of highway diesel fuel they produce. If
with their baseline. Specific concerns to distribute another grade of fuel. As a all of these refiners were to take a 2006
were raised regarding the ability of result, all comments from the refining baseline to determine the volume of 15
refiners to compensate for the loss of and fuel distribution community were ppm sulfur diesel fuel they would be
export contracts and to respond to in agreement that the baseline approach required to produce, a substantial drop
spikes in the demand for heating oil may be unworkable. in the total volume of 15 ppm sulfur
which periodically result from an Based on our review of the comments diesel fuel produced could result.
unexpectedly cold winter. Refiners also and our discussions with fuel producers The pre-compliance reports indicate
related that the constraints under the and distributors, it has become clear that the other 60 percent of refiners will
baseline approach could cause an anti- that none of the potential modifications be increasing the volume of highway
competitive dynamic between fuel to the baseline approach would diesel fuel they produce. We projected
refiners and their customers. adequately compensate for the inherent that these shifts in the slate of fuel
Based on our reevaluation of the inflexibility of requiring refiners to products that refiners produce would
baseline approach and the information comply with set production ratios. Even have an overall positive impact on
gathered from the public comments, it is if EPA were to adjust such ratios on an diesel fuel supply. However, refiners
now clear that the constraints on the annual basis, refiners might need to that increase the volume of highway
slate of fuels that a refiner produces approach EPA for an interim adjustment fuel they produce would likely chose to
under the baseline approach could if their contractual agreements changed calculate their baseline using their
interfere with a refiner’s ability to meet or if market demand shifted lower 2003–2005 production volumes.
market demands, which in turn could unexpectedly. The process of evaluating Doing so would result in a lower
result in supply shortages and increased requests for baseline adjustments could percentage of their distillate fuel that
fuel prices. For example, if a refiner be very burdensome to the industry and would be required to be produced for
were to lose an export contract for high to EPA, and EPA would unlikely be able highway diesel use, and subject to a 15
sulfur diesel fuel, the baseline approach to respond quickly enough to changing ppm sulfur standard.
could prevent that refiner from seeking market conditions. The volume of spillover could also be
to market that product domestically. More importantly, all of the potential reduced refiners were to dye 500 ppm
This could impact the overall supply of alternatives that we might implement to sulfur diesel they manufactured to meet
diesel fuel since the refiner may not mitigate the constraints of the baseline anticipated NRLM diesel fuel demand
have sufficient facilities to desulfurize approach could potentially undermine in order to avoid needing to comply
diesel fuel. Also, knowing that losing the environmental benefits of the with the baseline approach. Many
such an export contract would leave the highway program. Such alternatives all refiners commented that they
refiner with no ability to market its fuel would involve granting allowances to
domestically could give the refiner’s some refiners to produce additional 111 ‘‘Summary and Analysis of the Highway
export client an undue advantage during volumes of non-highway fuels above the Diesel Fuel 2003 Pre-compliance Reports,’’ EPA
contract negotiations. set baseline to facilitate a refiner 420–R–03–103, October 2003.
considered the baseline approach so would inappropriately restrict the caused by product downgrading in
unworkable and onerous that they flexibility of downstream parties to pipelines could be adequately
would choose to dye all of their 500 respond to market changes. EPA also accounted for under a designate and
ppm sulfur NRLM diesel fuel at the had concerns that it would reduce the track system so that such fluctuations
refinery gate. This could force some amount of 15 ppm spillover from the would not mask the inappropriate
parts of the distribution systems which highway market, reducing the shifting of 500 ppm sulfur NRLM diesel
had previously not carried two grades of environmental benefits of that rule. fuel to the highway pool. We have
diesel fuel for highway and off-highway Since the proposal, we received subsequently developed a periodic
uses to begin doing so. extensive input both in the written volume account balance system to
In summary, we are not finalizing the comments and through in-depth account for such fluctuations.
proposed baseline system because we meetings with representatives of all Through discussions with terminal
believe— segments of the fuel distribution operators, we have also resolved
1. It could unnecessarily constrain industry on how the designate and track concerns expressed in the NPRM that a
refiners ability to meet market demands, system might be structured to provide designate and track approach might
encouraging them to dye 500 ppm sulfur the needed compliance oversight limit a terminal operator’s ability to
NRLM diesel fuel at the refinery without placing an undue burden on respond to shifts in demand for 500
resulting in an added burden to the industry. Refiners now agree that the ppm sulfur highway versus NRLM
distribution system; designate and track approach should not diesel fuel. To avoid this potential
2. It could create a bias that could be an option for refiners in addition to problem today’s rule allows terminal
result in a loss in the volume of 15 ppm the baseline approach, and support it as operators and others to switch the
sulfur highway diesel fuel produced, a stand alone approach. All parties in designation of 500 ppm sulfur NRLM
and the options to remove these market the fuel distribution system have also diesel fuel to highway diesel fuel on a
constraints would only increase the bias now expressed support for the record temporary basis but not on a cumulative
to reduce the volume of 15 ppm sulfur keeping and reporting requirements basis over time. This will allow terminal
highway diesel fuel; and associated with tracking designated fuel operators to sell NRLM designated 500
3. The baseline approach would not volumes through each custodian in the ppm sulfur fuel into the highway market
ensure that the environmental benefits distribution chain until the fuel leaves provided that they later sell the same
of the 2007 highway diesel program the terminal either taxed or dyed. volume of highway-designated 500 ppm
would be maintained. Furthermore, commenters from all sulfur fuel into the NRLM market. To
ii. Designate and Track Approach segments of the fuel distribution ensure that 500 ppm sulfur NRLM
industry from the refiner through to the diesel fuel is not inappropriately shifted
At the time of the NPRM, we invited terminal stated that the information into the highway diesel pool, terminal
comment on an alternative to the needed to support the designate and operators will need to demonstrate that
baseline approach called the ‘‘designate track approach is already kept as part of the volume of 500 ppm sulfur highway
and track’’ approach. Under the normal business practices. Commenters diesel fuel they delivered is less than or
envisioned designate and track stated that only modest upgrades in equal to the volume received.
approach, refiners and importers would their record keeping procedures would In the NPRM, we stated that
designate the volumes of 500 ppm be needed to compile the needed determining the responsible party for a
sulfur diesel fuel they produce/import information and that preparing the violation of the restriction against
as either highway or NRLM diesel fuel necessary reports would not represent a shifting 500 ppm sulfur NRLM diesel
and would ship them fungibly. These significant burden. Thus, our concerns fuel into the highway pool would be
designations would follow the fuel that a designate and track approach difficult under a designate and track
through the distribution system and be might represent a large burden to fuel approach because a number of parties in
used to restrict the sale of 500 ppm distributors were unfounded. the distribution chain take custody of
sulfur NRLM diesel fuel from the In addition, we have developed the fuel without taking ownership.
highway market. While we sought appropriate solutions to the various However, this concern can be addressed
comment on various forms of the open questions and issues that we had by structuring the provisions to hold the
designate and track approach, we also with the designate and track approach at custodian of the fuel accountable for
expressed serious reservations regarding the time of the proposal. In the proposal any such violation that takes place
its workability, enforceability, impact it was unclear how a designate and track while the fuel is in their custody.
on the benefits of the highway rule, and approach would be structured to Review of electronic data submitted
constraints on the distribution system. account for the swell in highway diesel from all custodians in the highway and
For example, at the time of the proposal, fuel volumes in the winter that results NRLM diesel fuel distribution chain
refiners supported a designate and track from downstream kerosene blending to will reveal the custodian responsible for
approach where certain parts of the improve cold flow properties. Without a violation. By comparing such data on
distribution system (e.g., pipelines) did an adequate control mechanism, normal the hand-offs of designated fuel volumes
not have to report. EPA believed that swell in downstream highway diesel between all adjacent pairs of custodians
such an approach was unenforceable. fuel volumes in the North due to in the distribution chain for
Refiners were also supporting the kerosene blending during winter discrepancies, we can identify any party
designate and track approach as an months could mask the inappropriate responsible for inappropriately shifting
option for refiners to choose in addition shifting of NRLM-designated 500 ppm volumes of 500 ppm sulfur fuel
to the baseline approach. However, EPA sulfur fuel to the highway diesel pool. designated for use in NRLM equipment
believed that the two approaches were We have developed an appropriate to the highway market. Many terminals
incompatible. mechanism to address this situation as do not take ownership of the fuel that
As noted in the proposal, the described in section IV.D.3. they handle. Terminals that lease
designate and track approach allows In the proposal, we also expressed storage tanks to multiple owners will
maximum flexibility for refiners and concerns regarding how normal need to enter into contractual
importers, but EPA had concerns that volumetric fluctuations in the agreements with their tenants to ensure
the volume reconciliation requirements distribution system such as those that they understand their obligations as
a custodian of designated fuel and do in the distribution system.112 These are highway program will be substantially
not inappropriately change the the same areas where the majority of greater than estimated if the projections
designation of fuels stored in such spillover occurs today. After the in the pre-compliance reports are
leased tanks. highway diesel program becomes realized.
effective in 2006, we project that only Based on the above discussion, we
An effective enforcement and believe that the concerns regarding the
15 ppm sulfur highway diesel fuel will
compliance assurance program must designate and track approach’s
be supplied in bulk shipments to both
include the ability to rapidly and the highway and NRLM markets in most workability, enforceability, and ability
accurately review the large amount of of these same areas. Although 500 ppm to preserve the benefits of the highway
data on the hand-offs of designated fuel sulfur highway diesel fuel could be program and today’s NRLM diesel fuel
volumes for discrepancies. This can be shipped in bulk to these areas through program have been satisfactorily
accomplished if all parties report 2010 under the highway program’s TCO, resolved.
electronically to a database which can the potential demand for such fuel and b. Ensuring That Heating Oil Is Not
reconcile hand-off volumes between all for 500 ppm sulfur NRLM diesel fuel Used in NRLM Equipment From June 1,
parties in the distribution chain in an would not be sufficient to justify the 2007 Through June 1, 2010
automated fashion. All segments in the cost of segregating an additional grade
fuel distribution system are now in of 500 ppm sulfur diesel fuel in these i. Use of a Fuel Marker in Heating Oil
support of providing the necessary areas for a short period of time. The To prevent shifting heating oil into
information to such an electronic designate and track approach does not the NRLM market, we proposed that a
reporting system. We have conducted a impact the costs of segregation, and fuel marker be added to heating oil at
review of the Agency resources that therefore is not expected to change the refinery gate. We proposed that the
would be needed to compile the distribution patterns that are based on presence of the marker required in
industry reports on the transfer of these costs. heating oil would be strictly prohibited
designated fuel volumes, perform After 2010, when 500 ppm sulfur in NRLM diesel fuel. As noted earlier,
highway fuel no longer exists, the total this approach is similar to red dye
quality assurance on these data, and to
volume of 500 ppm sulfur diesel fuel in requirements for high sulfur diesel fuel
perform the necessary analysis of the
the distribution system will be that were implemented in 1993 to
database to discover potential
substantially reduced, and there will be prevent its use as highway diesel fuel
violations. Our review indicates that the even less incentive to distribute an subject to the then applicable 500 ppm
reporting forms can be standardized and additional grade of 500 ppm sulfur sulfur standard.
the review process automated in such a diesel fuel in bulk. Therefore, the only We proposed that the marker be
fashion as to minimize the Agency areas where substantial flexibility will added at the refinery gate rather than at
resource requirements, while at that exist under today’s program to supply the terminal for several reasons. First,
same time ensuring the quality of the either highway or NRLM diesel fuel to this seemed to be the most efficient and
data and completeness of the review the NRLM market is in areas where this lowest cost option for addition of the
process. In light of the above discussion, flexibility exists today. Despite this marker given that the number of
we are now convinced that a designate flexibility in the current regulations, terminals is far greater than the number
and track approach can be designed to spillover currently still occurs. of refineries.113 Second, requiring that
meet our enforcement and compliance Therefore, we project that there will be the marker be present in heating oil
assurance needs under today’s rule. little additional potential due to today’s when it is introduced into the
In addition to concerns regarding the rule for refiners to reduce highway distribution system would ensure that
workability and enforceability of a spillover into the NRLM market under we could differentiate high sulfur small
a designate and track approach and that refiner and credit fuel from heating oil
designate and track approach, the
such spillover levels would not be at any point in the system. This
NPRM expressed concerns that approach would provide good assurance
significantly reduced from historical
application of such an approach could that the inability to use fuel sulfur
levels. In contrast, as discussed above,
reduce the benefits of the highway content to differentiate heating oil from
we now believe that the baseline
diesel program by reducing the amount approach would have resulted in a high sulfur NRLM diesel fuel produced
of highway diesel fuel that is used in significant loss of 15 ppm diesel under the small refiner and credit
nonroad equipment due to the logistical production. provisions in today’s rule (effective
constraints in the distribution system Furthermore, concerns regarding a until June 1, 2010) would not provide
(‘‘spillover’’). Specifically, it was potential reduction in the spillover of 15 an opportunity to mask the potential use
thought that the opportunity to fungibly ppm sulfur highway diesel into the of heating oil in NRLM equipment.
ship batches of 500 ppm sulfur NRLM NRLM markets has been lessened by the Providing such assurance is an essential
diesel fuel and 500 ppm sulfur highway information provided in the highway element to enable the implementation of
diesel fuel might allow refiners to program pre-compliance reports. These the small refiner and credit provisions
supply highway and NRLM diesel fuel reports suggest that more than 95 in today’s rule. Lastly, under the
to markets where they would otherwise percent of highway diesel fuel will be proposed baseline approach, there was
have supplied just highway fuel for both produced to a 15 ppm sulfur standard no other way to ensure that heating oil
purposes. Our reevaluation since the beginning in 2006. In calculating the was not shifted into the NRLM diesel
proposal indicates that this is not a projected benefits of the highway diesel fuel pool during distribution from the
significant concern. As noted earlier, program, we assumed that only 80 refinery/importer to the terminal.
there are currently substantial regions of percent of highway diesel fuel would We received numerous comments that
the country where only highway diesel meet a 15 ppm sulfur standard. the upstream addition of the proposed
Therefore, the actual benefits of the marker to heating oil would raise
fuel is supplied by bulk shipments to
significant concerns that the marker
both the highway and NRLM markets
112 This highway diesel fuel would meet the
due to the high costs associated with currently-applicable 500 ppm sulfur standard for 113 Additional injection equipment will be
segregating an additional distillate grade highway diesel fuel. required to inject the heating oil marker.
might contaminate jet fuel. Commenters today’s rule does not provide visual focused on determining the likely
stated that this would represent a evidence of its presence. However, if the production and marketing of these high
substantial safety concern unless the marker is added at the terminal it will sulfur NRLM fuels in portions of PADD
proposed marker was proven not to only be present in heating oil when red I in this time frame.
adversely impact the quality of jet fuel dye is also present. The fact that heating We held in-depth discussions with
and the operation of jet engines. oil will be dyed red pursuant to IRS organizations representing refiners,
The designate and track approach requirements before it leaves the pipelines, and terminal operators to
described above for 500 ppm sulfur terminal will enable jet fuel distributors evaluate this issue. Representatives of
NRLM diesel fuel, however, also to continue to use the ‘‘white bucket non-small refiners including API and
provides an effective means to address test’’ to detect heating oil NPRA stated that being precluded from
concerns about the use of the fuel contamination, and hence marker selling sulfur credit fuel in the
marker. By extending the designate and contamination of jet fuel. Today’s rule Northeast and Mid-Atlantic would not
track approach to high sulfur NRLM also includes a stand-alone requirement significantly reduce the intended
diesel fuel and heating oil, these that any fuel to which the fuel marker benefits to refiners of the credit
otherwise identical fuel grades can be is added must also contain visible provisions in today’s rule. We also
tracked down to the terminal, and the evidence of red dye.118 spoke with small refiner representatives
marker then can be added at the of and the specific small refiners whose
terminal instead of at the refinery gate. ii. Provisions To Ensure Heating Oil Is
Not Used in NRLM Equipment in the marketing area might include the
Going beyond the terminal with Northeast and Mid-Atlantic and found
designate and track is not feasible give Northeast and Mid-Atlantic
that in fact, small refiners were not
the breadth and nature of entities In the Northeast, heating oil will
expected to market fuel in this area.
involved.114 As a result, the marker is continue to be distributed in significant
Finally, we evaluated the current and
still required downstream of the quantities after implementation of the
likely future practices in the Northeast
terminal. However, shifting the point of NRLM diesel fuel program. Discussions
and Mid-Atlantic areas for the sale of
marker addition downstream to the with terminal operators in the
downgraded fuel generated in the
terminal should eliminate any Northeast, and other representatives of
distribution system. We found that this
significant opportunity for jet fuel heating oil users and distributors,
downgraded diesel fuel could easily
contamination. Subsequent comments revealed concerns that the proposed
continue to be sold in the very large and
and discussions appear to have heating oil marker requirement would
represent a substantial new burden on ubiquitous heating oil market that is
confirmed this.115 EPA will continue to
terminal operators and users of heating expected to continue to exist in this
work with other federal agencies,
oil. Terminal operators stated that the region. This avoids any need for
including FAA and DoD, and to follow
cost of installing new injection additional storage or tankage for both
ongoing research and studies regarding
equipment would be burdensome, and high sulfur and low sulfur NRLM fuels,
the effect of dyes and markers on jet
that the cost of the marker itself would and fits into the pre-existing market
fuel, particularly potential
be significant given the large volume of structure for heating oil.
contamination that could have an
adverse impact on the safe operation of heating oil used in the Northeast. They Consequently, unlike the rest of the
aircraft. We will keep abreast of the also stated that they did not expect any country, there was little expected need
ASTM, CRC, FAA, IRS, and EU small refiner or credit fuel to be used in to maintain a high sulfur NRLM market
activities regarding the evaluation of the the Northeast, and that consequently, in this part of the country as an outlet
use of SY–124 and commit to a review the marker requirement was not needed for small refiner, credit, or off-
of our use of SY–124 under today’s rule in this area. They suggested that if we specification, downgraded diesel fuel.
based on these findings. If alternative prohibited the sale of small refiner and Based on this input, we concluded that
markers are identified that do not raise credit fuel in PADD I, this area could be codifying this expected practice and
concerns regarding the potential exempted from the heating oil marker making it enforceable, i.e. not allowing
contamination of jet fuel, we will requirement. high sulfur fuel to be marketed as NRLM
initiate a rulemaking to evaluate the use We evaluated the viability of avoiding in this area of the country, would be
of one of these markers in place of SY– the heating oil marker requirement in consistent with the current distribution
124.116 portions of PADD I and instead practices in this area of the country and
We also received a number of enforcing the NRLM diesel fuel that the potential impact of taking such
comments expressing concern over the standards on the basis of sulfur content an approach on the flexibility offered in
inability of the proposed marker to be alone. The heating oil marker is needed the program would be minimal or
detected using the standard simple test to ensure that heating oil is not sold into nonexistent. If we codified it we would
used today to detect contamination with the NRLM market as high sulfur NRLM no longer need the marker requirement,
red dye.117 The marker finalized by fuel. The marker is needed only if high and the resulting benefits and cost
sulfur NRLM fuels will otherwise be in savings to terminals would be
114 Including every end-user of heating oil. the market. High sulfur NRLM fuel can substantial. The approach would also
115 Letter to Paul Machiele, EPA, from James be produced under the small refiner and simplify and strengthen the enforcement
Thomas, American Society for Testing and credit provisions, and through the of today’s sulfur requirements in this
Materials (ASTM), entitled ‘‘Withdrawal of ASTM
Request,’’ January 19, 2004. In this letter ASTM generation of high sulfur NRLM in the area by allowing EPA to enforce the
withdraws its request for a postponement of the distribution system from the NRLM standards simply based on the
finalization of the heating oil marker requirements downgrading of 500 ppm sulfur NRLM. measurement of the sulfur content of the
in today’s rule. See section V.E regarding the
selection of the heating oil marker required in
In evaluating the feasibility of avoiding fuel. There would be little expected
today’s rule. the heating oil marker, EPA therefore impact on the environment as this is not
116 See section VIII.H. of today’s preamble. expected to change the amount of high
117 To test for contamination, jet fuel marketers 118 If IRS amends its red dye requirements, EPA
sulfur fuel produced from small
typically fill a white five gallon bucket with jet fuel. will also seriously consider amending the fuel refiners, credit usage, or downgrade in
The presence of a pink tinge to the light straw marker and associated red dye requirements
colored jet fuel indicates that the fuel has been contained in today’s rule. See section V.E. of the distribution system, only the market
contaminated with fuel that contains red dye. today’s preamble. into which it is sold.
In deciding which parts of PADD I to NRLM diesel fuel, and reviewed heating In summary, the areas excluded from
use this enforcement mechanism, we oil use levels in areas that will have the marker requirement and where the
attempted to minimize the number of access to bulk shipments of heating oil. sale of NRLM diesel fuel produced or
terminals that would need to install new Based on our assessment we concluded imported under the credit and hardship
injection equipment and the amount of that defining the Northeast/Mid-Atlantic provisions or from the downstream
heating oil that would need to be area as described below would best downgrade provisions of today’s rule is
marked, while preserving the benefits of achieve our goals.119 In most cases, prohibited are: North Carolina, Virginia,
the small refiner and credit fuel whole states in PADD 1 were assigned Maryland, Delaware, New Jersey,
provisions in today’s rule to the to this ‘‘Northeast/Mid-Atlantic’’ area. Connecticut, Rhode Island,
maximum extent possible. To assess the This decision was primarily based on Massachusetts, Vermont, New
placement of the boundary for the the continued high level of heating oil Hampshire, Maine, Washington DC,
Northeast/Mid-Atlantic area where the use projected in these states and the New York (except for the counties of
marker requirement was waived, we lack of significant concern regarding the
Chautauqua, Cattaraugus, and
evaluated the magnitude of heating oil elimination of the program’s flexibilities
Allegany), Pennsylvania (except for the
demand by state (see chapter 5 of the to produce high sulfur NRLM diesel fuel
RIA), solicited input from the in these states. A few counties in counties of Erie, Warren, Mc Kean,
potentially affected parties, evaluated Eastern West Virginia were also Potter, Cameron, Elk, Jefferson, Clarion,
the area supplied by the pipeline assigned to the Northeast/Mid-Atlantic Forest, Venango, Mercer, Crawford,
distribution systems that are expected to area based on supply patterns in the Lawrence, Beaver, Washington, and
continue to ship heating oil after the area. On the other hand, a number of Greene), and the eight eastern-most
implementation of today’s rule, counties in Western New York and counties in West Virginia (namely:
evaluated the locations of terminals that Pennsylvania were not assigned to the Jefferson, Berkeley, Morgan, Hampshire,
are likely to receive bulk shipments of Northeast/Mid-Atlantic area due to the Mineral, Hardy, Grant, and Pendleton).
heating oil, evaluated the distribution need to maintain flexibilities for refiners The Northeast/Mid-Atlantic Area is
area of small refiner(s) for high sulfur serving this area. illustrated in the following figure:
As discussed in section IV.D.2 below, significant factor in our evaluation of pathways from a limited number of
the marker requirement for 500 ppm how to define the boundary of the refineries. Therefore, a significant
sulfur LM diesel fuel that will be Northeast/Mid-Atlantic area. We expect number of terminals will not need to
effective outside of this Northeast/Mid- that locomotive and marine diesel fuel handle LM diesel fuel that is subject to
Atlantic area and Alaska from June 1, subject to the marker requirements will the marker requirement. Thus, the
2010, through May 31, 2012, was not a primarily be distributed via segregated potential cost of installing injection
119 See chapter V of the RIA for a detailed where the marker requirement is waived. See the RIA for a discussion of the costs of the heating
discussion of the analysis which supports our section VI of today’s preamble and chapter VII of oil marker requirements finalized by today’s rule.
definition of the Northeast/Mid-Atlantic areas
equipment to add the marker to 500 referred to as a tank wagon) for direct 500 ppm sulfur LM diesel that is
ppm sulfur LM diesel fuel which is delivery to heating oil users, and by required to be marked which is
subject to the marker requirement will bulk plant operators. Bulk plant distributed over the compliance period.
be limited to only a few refineries and operators pick up fuel from terminals as These records must demonstrate that the
terminals (i.e. approximately 15, see described above. However, since they prescribed marker concentration was
section VI.A of today’s preamble). maintain their own bulk fuel storage present in the heating oil and the 500
In all areas of the country other than facilities, they have the choice of storing ppm sulfur LM diesel fuel subject to the
the Northeast/Mid-Atlantic area shown the fuel at their facility prior to eventual marker requirement that they
in figure IV.D–1 (and Alaska as delivery to their customers. Under the discharged.
discussed below), heating oil, and high provisions of today’s rule, as long as a
sulfur NRLM diesel fuel will be iii. State of Alaska
bulk plant only receives heating oil to
designated at the refinery or importer which the marker has already been Although the fuel marker facilitates
and tracked through the distribution added, it does not have to register, keep the enforcement of the NRLM diesel fuel
system to the terminal. From June 1, records, or report. However, if it chooses sulfur standards by distinguishing it
2010, through May 31, 2012, 500 ppm to receive any unmarked heating oil, from heating oil, as described above, we
sulfur LM diesel fuel and 500 ppm then it will be treated the same as a large are not requiring use in Alaska. Unlike
nonroad diesel fuel must also be terminal under the provisions of today’s the situation in the Northeast and Mid-
designated at the refinery or importer final rule. We do not expect that bulk Atlantic area, however, we are not
and tracked through the distribution plants will handle LM diesel fuel to a prohibiting the production of high
system to the terminal outside of the significant degree. For bulk plant sulfur NRLM diesel fuel after 2007, and
Northeast/Mid-Atlantic area and Alaska. operators that might handle LM diesel 500 ppm nonroad diesel fuel from after
The specified fuel marker (see section fuel, today’s rule provides that as long 2010 by small refiners in Alaska. While
V.E of this preamble) must be added to as a bulk plant does not receive any 500 such a prohibition in the Northeast/
heating oil distributed from all ppm sulfur LM diesel fuel which is Mid-Atlantic area does not impact small
terminals located outside of the required to be marked under today’s refiners, flexibility for small refiners is
Northeast/Mid-Atlantic area defined rule, but which has not yet been expected to be important in Alaska.
above and Alaska. The same fuel marker marked, it does not have to register, Thus, we need to preserve the flexibility
must also be added to 500 ppm sulfur keep records, or report. However, if it for high sulfur NRLM diesel fuel in
LM diesel fuel produced at a refinery or chooses to receive any unmarked 500 Alaska for small refiners along with
imported that is distributed from ppm sulfur LM diesel fuel which is eliminating the marker. The program
terminals located outside of the subject to the marker requirements must therefore provide another means of
Northeast/Mid-Atlantic area and Alaska under today’s rule, then it will be enforcing the NRLM diesel fuel sulfur
from June 1, 2010, through May 31, treated the same as a large terminal standards without eliminating a small
2012. This includes all heating oil and under the provisions of today’s final refiner’s ability to produce and
the subject 500 ppm sulfur LM diesel rule. distribute high sulfur NRLM diesel fuel.
fuel distributed from terminals outside Any party that transports bulk Under today’s program we are
of the Northeast/Mid-Atlantic area quantities of heating oil solely to the finalizing a provision that will allow
regardless of whether the fuel is Northeast/Mid-Atlantic area or within flexibility for small refiners to delay
delivered to a retailer, wholesale this area is not subject to the designate compliance with the NRLM diesel fuel
purchaser-consumer, or end-user and track requirements for heating oil sulfur standards as discussed in section
located inside or outside of the described below. Similarly, any party IV.B. Small refiners in Alaska may avail
Northeast/Mid-Atlantic area. that transports bulk quantities of 500 themselves of this option provided that
Terminals inside the Northeast/Mid- ppm sulfur LM diesel fuel solely to the the refiner first obtains approval from
Atlantic area are exempted from the fuel Northeast/Mid-Atlantic area or within the administrator for a compliance plan.
marker requirements in today’s rule, but this area is not subject to the designate The plan must at a minimum show the
only for the volume of heating oil and and track requirements for LM diesel following information:
500 ppm sulfur LM diesel fuel subject fuel. However, any high sulfur fuel (1) How they will segregate its fuel through
to the marker requirements that is used distributed from inside the Northeast/ to end-users;
by wholesale-purchaser-consumers and Mid-Atlantic area to outside of the (2) How they will segregate its fuels from
end-users that are located inside the Northeast/Mid-Atlantic area must be other grades and other refiners’ fuels; and
Northeast/Mid-Atlantic area. Any designated as heating oil by the party (3) All end-users to whom the fuel is sold
heating oil and subject 500 ppm sulfur as well as the fuel volumes.
responsible for the transfer and must be
LM diesel fuel distributed from marked. Likewise, any 500 ppm sulfur End-users who receive the fuel must
terminals inside the Northeast/Mid- LM diesel fuel distributed from inside retain records of all fuel shipments to
Atlantic area to a retailer, wholesale- the Northeast/Mid-Atlantic area from demonstrate that no heating oil was
purchaser-consumer, or end-user that is June 1, 2010, through May 31, 2012, used in NRLM diesel equipment and
located outside of the Northeast/Mid- must be designated as 500 ppm sulfur that no 500 ppm sulfur LM diesel was
Atlantic area must be marked. LM diesel fuel by the party responsible used in nonroad equipment. In order to
Terminal operators do not often for the transfer and must be marked. limit the potential sources of fuel not
distribute fuel to retailers, wholesale- Entities who are required to inject meeting the sulfur standard, constrain
purchaser-consumers, and end-users marker into heating oil must maintain the number of end-users who may
directly. This task is frequently records of the volume of marker used in legitimately have higher sulfur fuel in
accomplished by ‘‘jobbers’’ who pick up heating oil, and the volume of heating their NRLM diesel equipment, and thus
large tank truck loads of fuel from the oil distributed over the compliance maintain the overall program’s
terminal for delivery to their retailer and period. Entities that are required to enforceability, we are not finalizing the
wholesale-purchaser-consumer inject marker into 500 ppm sulfur LM other provisions that allow for higher
customers, ‘‘heating oil dealers’’ who diesel fuel must maintain records of the sulfur fuel to be produced and/or
pick up fuel from a terminal using a volume of marker used in 500 ppm distributed in Alaska (i.e., credit,
smaller capacity tank truck (often sulfur LM diesel fuel, and the volume of transmix processor, or downstream
distribution system provisions). In this to 15 ppm sulfur No 1, diesel fuel. Such downgrading provisions finalized in the
regard, Alaska is treated in the same fuel will be manufactured for 2007 highway diesel final rule, such as
manner as the Northeast/Mid-Atlantic wintertime blending to improve diesel the provisions unique to fuel retailers.
area. cold flow properties. In a number of
2. Requirements During the Second Step
areas we expect that 15 ppm sulfur No.
c. Updating the Highway Program’s of Today’s Sulfur Control Program
1 fuel will be the only No.1 fuel
Anti-Downgrade Requirements Beginning June 1, 2010, all NR diesel
available for winterizing highway and
Under the highway diesel fuel NRLM diesel fuel, and heating oil. fuel and beginning June 1, 2012 all LM
program, each entity in the distribution Therefore, applying the anti- diesel fuel produced or imported must
system may downgrade a maximum of downgrading requirements to 15 ppm meet a 15 ppm sulfur standard except
20 percent of the 15 ppm sulfur sulfur No. 1 fuel would be unnecessary for fuel manufactured under the credit
highway diesel fuel it receives to 500 to maintain the availability of 15 ppm and small refiner provisions in today’s
ppm sulfur highway diesel fuel. sulfur highway diesel fuel, and would rule. This credit and small refiner diesel
However, there was no limit on the interfere with its intended use in the fuel must meet a 500 ppm sulfur level.
volume of 15 ppm sulfur highway diesel range of No. 2 fuels. From June 1, 2010 to June 1, 2012, all
fuel that could be downgraded to NRLM From October 1, 2006, through May LM diesel fuel must meet a 500 ppm
diesel fuel. Prior to today’s rule, this 31, 2010, all fuel distributors sulfur standard. Today’s rule also allows
was appropriate because the sulfur downstream of the refiner or import 500 ppm sulfur diesel fuel generated in
content of NRLM diesel fuel was facility must satisfy one of four criteria the pipeline distribution system to be
uncontrolled, and hence once 15 ppm as outlined in 40 CFR 80.598 of today’s used in NRLM equipment through May
sulfur highway diesel fuel was regulation to demonstrate compliance 31, 2014 120 and in locomotive and
downgraded to NRLM diesel fuel such with the highway program’s anti- marine equipment thereafter. After May
fuel could not be used in the 500 ppm downgrading requirements. These 31, 2014, the credit and small refiner
sulfur highway diesel market. The criteria are based on the designate and provisions expire.
implementation of today’s 500 ppm track system for different grades of fuel We proposed that once refiners were
sulfur standard for NRLM diesel fuel, through the distribution system. The no longer able to produce 500 ppm
however, means that 15 ppm sulfur first criteria is the simplest and most sulfur diesel fuel for use in nonroad
highway fuel downgraded to 500 ppm straightforward, with the least record engines and such fuel had a few months
sulfur NRLM diesel fuel potentially keeping burden. It merely tracks a to work its way through the distribution
could be shifted into the highway facility’s No. 2 15 ppm sulfur highway system, that 500 ppm sulfur diesel fuel
market. This could undermine the diesel volume receipts and deliveries could no longer be used in nonroad
benefits of the highway program for the and requires the deliveries to be at least equipment. Today’s rule adopts this
reasons described previously. To 80 percent of the receipts. Since the proposed prohibition. Although today’s
prevent this situation, we proposed that anti-downgrading provisions were rule extends the 15 ppm sulfur nonroad
the anti-downgrading requirements implemented to protect against diesel standard to locomotive and
under the highway diesel program intentional downgrading and not to marine diesel fuel, we have elected not
would also apply to the downgrading of limit downgrading that would occur in to extend the prohibition against the use
15 ppm sulfur highway diesel fuel to the normal distribution of 15 ppm sulfur of 500 ppm sulfur diesel fuel in
500 ppm sulfur NRLM diesel fuel. We fuel, we anticipate that most facilities locomotive and marine equipment after
received comments from refiners and will be able to easily meet this simple refiners and importers are no longer
fuel distributors that such a limitation criteria. allowed to produce/import such fuel.
would restrict their ability to supply the The second criteria tracks a facility’s Diesel fuel with a maximum sulfur
NRLM diesel market, particularly in receipts and distribution of both No. 2 concentration of 500 ppm that is
areas where refiners plan to supply only 15 ppm sulfur fuel and No.2 500 ppm generated in the pipeline distribution
15 ppm sulfur diesel fuel for both the sulfur highway diesel fuel, and limits system can continue to be used in
highway and NRLM markets. deliveries of No. 2 500 ppm sulfur locomotive and marine equipment after
Putting in place the designate and highway diesel fuel to no more than June 1, 2014, as discussed in section
track provisions allows 500 ppm sulfur what was received plus 20 percent of IV.A above.
highway and 500 ppm sulfur NRLM the No. 2 15 ppm sulfur highway diesel Providing for the continued use of 500
diesel fuel to be tracked separately. This fuel volume received. This allows more ppm sulfur diesel fuel in NRLM
enables the anti-downgrading flexibility than the first criteria by not equipment through May 31, 2014,
requirements to only apply to the constraining downgrades to NRLM means that without adequate controls
downgrading of 15 ppm sulfur highway diesel fuel or heating oil, but does so by similar to those under the first step of
diesel fuel to 500 ppm sulfur highway requiring tracking and records of today’s program, a refiner could
fuel as originally required in the 2007 volumes of No. 2 15 ppm sulfur manufacture 500 ppm sulfur diesel fuel
highway final rule. In the context of the highway diesel fuel received and the ostensibly for use as heating oil which
designate and track requirements in products to which it is downgraded. could actually be sold downstream into
today’s rule, the highway program’s The third and fourth criteria provide the NRLM market through May 31,
anti-downgrading provisions are even more flexibility, especially for 2014. Similarly, the continued use of
clarified as described below. Similar to wintertime blending of No. 1 15 ppm 500 ppm fuel in locomotive and marine
the approach described above regarding sulfur highway diesel fuel, and also for engines after May 31, 2014, means that
the prevention of the use of 500 ppm any temporary shifts that might occur without adequate controls, a refiner
sulfur NRLM diesel fuel in the highway between NRLM diesel fuel and highway could continue to manufacture 500 ppm
market, each custodian of 15 ppm sulfur diesel fuel markets from 2007–2010. sulfur diesel fuel ostensibly for use as
No. 2 highway diesel fuel must maintain However, a facility will have to meet heating oil which could actually be sold
records that demonstrate their more extensive criteria to demonstrate
compliance with the highway program’s compliance. 120 The use of 500 ppm fuel in nonroad
anti-downgrade requirements. The anti- Today’s final rule does not change equipment is restricted to 2011 model year and
downgrading requirements do not apply any other aspects of the anti- earlier equipment.
downstream into the locomotive and would be tracked, and the 500 ppm when it is delivered to another party.
marine market indefinitely. To prevent sulfur LM fuel would be marked in the The definition also include mobile
this possibility, we have elected to same manner as heating oil. The same components, such as the vessels in a
continue the designate and track and provisions that apply to marking of barge facility. Examples of facilities
marker requirements for heating oil heating oil, such as the Northeast/Mid- include refineries, import terminals,
applicable under the first step of today’s Atlantic area, would also apply to the pipelines, terminals, bulk plants, and
program indefinitely with some marking of 500 ppm sulfur LM fuel. The barge systems. Where the same entity
simplifications. It is a significantly tracking and marking provisions would owns and operates a series of locations
smaller program during the second step, not apply to any 15 ppm sulfur LM in the distribution system (e.g., refiner
since only heating oil needs to be diesel fuel. to pipeline to terminal), it may choose
tracked, and we expect that by then very to register them as a single aggregated
little heating oil will be produced for 3. Summary of the Designate and Track
facility, provided the entity maintains
sale outside of the Northeast/Mid- Requirements
custody of the fuel throughout the
Atlantic area. Consistent with the The designate and track program facility. However, if the aggregated
approach taken during the first step of requires refiners and importers to facility includes a refinery, then it may
today’s program, these designate and designate the volumes of diesel fuel not receive any diesel fuel from another
track provisions would not be they produce and/or import. Refiners/ entity at any place within the aggregated
applicable in the Northeast/Mid- importers will identify whether their facility. Under this approach, a pipeline
Atlantic area or Alaska, since the diesel fuel is highway or NRLM and the could be treated as one facility from the
flexibility to sell greater than 15 ppm applicable sulfur level. They may then point where it receives fuel to the point
sulfur diesel fuel into the NRLM market mix and fungibly ship highway and where it either delivers it to a terminal,
there does not exist under this final NRLM diesel fuels that meet the same or into a tank truck after passing
rule.121 Any diesel fuel with a sulfur sulfur specification without dyeing their through their terminal. The choice made
content greater than 500 ppm beginning NRLM diesel fuel at the refinery gate. by the entity to treat these places as a
June 1, 2007, any NR diesel fuel with The volume designations will follow the single facility or separate facilities may
greater than 15 ppm sulfur beginning fuel through the distribution system not change during any applicable
June 1, 2010, and any LM diesel fuel with limits placed on the ability of compliance period. These same
with greater than 15 ppm sulfur downstream parties to change the definitions for facility will apply for
beginning June 1, 2012 in the Northeast/ designation. These limits are designed both the designate and track provisions,
Mid-Atlantic area can only be sold as to restrict the inappropriate sale of 500 as well as the anti-downgrading
heating oil, and if shipped outside of the ppm sulfur NRLM diesel fuel into the provisions of the highway rule.
Northeast/Mid-Atlantic area must be highway market; from 2007 to 2010, the Therefore, if a proprietary system
marked as heating oil. inappropriate sale of 500 ppm sulfur LM chooses to aggregate into one facility for
While today’s rule does not contain diesel fuel into the 500 ppm sulfur NR purposes of the designate and track
an end date for the downstream market from 2010 to 2012; and the provisions, it will also be treated as one
distribution of 500 ppm sulfur inappropriate sale of heating oil into the facility for determining compliance with
locomotive and marine fuel, we will NRLM market. The designate and track the 20 percent anti-downgrading limit of
review the appropriateness of allowing approach includes record keeping and the highway rule. EPA will provide a
this flexibility based on experience reporting requirements for all parties in unique registration number to each
gained from implementation of the 15 the fuel distribution system, associated custodial facility of designated fuels. In
ppm sulfur NRLM diesel fuel standard. with tracking designated fuel volumes addition, EPA intends to work with
We expect to conduct such an through each custodian in the industry subsequent to this final rule to
evaluation in 2011. Were we to distribution chain until the fuel exits provide guidance regarding facility
discontinue the downstream provision the terminal. The program also includes boundary and aggregation decisions that
for downgraded fuel, we would also enforcement and compliance assurance will address the many unique
evaluate discontinuing the designate provisions to enable the Agency to situations.
and track and marker requirements for rapidly and accurately review for
heating oil, as is the case now for the The designation provisions described
discrepancies the large volume of data
Northeast/Mid-Atlantic area. below require refiners and importers to
collected on fuel volume hand-offs.
Providing for the continued designate all distillates they produce or
production and import of 500 ppm a. Registration import consistent with the production
sulfur LM diesel fuel from June 1, 2010 Each entity in the fuel distribution and end-use requirements in today’s
to June 1, 2012 means that without system, up through and including the rule. These designations serve as the
adequate controls similar to those under point where fuel is loaded onto trucks foundation upon which the fuel
the first step of today’s program, a for distribution to retailers or wholesale distributors are able to properly track,
refiner could manufacture 500 ppm purchaser-consumers, must register designate, redesignate, and label the fuel
sulfur diesel fuel ostensibly for use as each of its facilities with EPA no later they receive.
LM diesel fuel which could actually be than December 31, 2005, or six months b. Designation by Refiners and
sold downstream into the NR market. To prior to commencement of producing, Importers
prevent this possibility, we have importing, generating, or distributing
i. Designation of 500 ppm and 15 ppm
adopted designate and track and marker any designated diesel fuel.122 A facility
Sulfur Diesel Fuel
requirements similar to those applicable is defined as the physical location(s)
to heating oil under the first step of where a party has custody of designated From June 1, 2006, through May 31,
today’s program. For these two years, fuel, from when it was produced, 2010, any refiner 123 or importer that
500 ppm sulfur NR and LM diesel fuel imported, or received from one party to
123 Transmix operators that produce diesel fuel
121 Unless, in the case of Alaska, the refiner 122 This requirement also applies to parties inside from transmix and terminal operators that produce
segregates its fuel through to the end user as of the Northeast/Mid-Atlantic area who handle from segregated interface will be treated as a refiner
discussed in section IV.D.1.b.ii. heating oil. Continued
produces or imports 15 ppm sulfur 80/20 highway requirements. As with requirements such that refiner who was
diesel fuel, and/or 500 ppm sulfur 15 ppm sulfur kerosene or jet fuel, previously required to produce 100
diesel fuel must designate all batches of downstream parties would later percent of its highway diesel fuel to the
such fuel as one of the following. The redesignate it as highway or NRLM 15 ppm sulfur standard may now
purpose of this designation requirement diesel fuel if blended in or used for produce 95 percent to the 15 ppm sulfur
is to ensure that 500 ppm sulfur NRLM these purposes. Any 500 ppm sulfur standard (in order to avail itself of the
diesel fuel is not shifted into the diesel fuel containing visible evidence extended gasoline sulfur interim
highway market, and to evaluate of red dye must be designated as NRLM standards).
compliance with the highway program’s diesel fuel or heating oil unless it is tax
ii. Designation of High Sulfur NRLM
anti-downgrade requirements. exempt highway diesel fuel (e.g., fuel
Diesel Fuel, Heating Oil, and Jet Fuel/
• 15 ppm sulfur No. 2 highway diesel for use in school buses or certain
Kerosene
fuel; municipal fleets).
• 15 ppm sulfur No. 1 highway diesel The reported volumes of designated From June 1, 2007 through May 31,
fuel; fuels must be the volumes delivered to 2010, any refiner, or importer not
• 500 ppm sulfur No. 2 highway the first downstream party. This is located in the Northeast/Mid-Atlantic
diesel fuel; typically a pipeline facility, a marine area or Alaska, that produces or imports
• 500 ppm sulfur No. 1 highway barge/tanker loading dock that accepts unmarked high sulfur distillate fuel
diesel fuel; product from a refiner/importer, or the must designate all batches of such fuel
• 500 ppm sulfur No. 2 NRLM diesel refiner’s/importer’s truck loading rack. as one of the following: heating oil, high
fuel; This is consistent with normal business sulfur NRLM diesel fuel, or jet fuel/
• 500 ppm sulfur No. 1 NRLM diesel practices. Refiners, importers, and kerosene. Any heating oil distributed
fuel; transmix processors are not required to from a refiner’s or importer’s rack not
• 500 ppm sulfur jet fuel; or add red dye to NRLM diesel fuel unless located in the Northeast/Mid-Atlantic
• 500 ppm sulfur kerosene. the fuel is distributed over their truck area or Alaska must contain the
The start date for these requirements loading rack such that the IRS requires designated marker and red dye. Any
coincides with the start date for the the addition of red dye for the heating oil distributed from a refiner/
early credit program under today’s final assessment of taxes. importer rack inside of the Northeast/
rule, and the start date for the highway Fuel designated by a refiner or Mid-Atlantic area or Alaska is exempted
diesel program for the purposes of anti- importer as highway diesel fuel must from the marker requirement except any
downgrading. The end date for these comply with the highway program’s 80/ heating oil that is delivered outside the
requirements coincides with the end 20 requirement for 15 ppm/500 ppm Northeast/Mid-Atlantic area must be
date for the highway program’s sulfur highway diesel fuel. The volume marked.
Temporary Compliance Option and of fuel designated as NRLM early credit As discussed previously, 500 ppm
today’s NRLM diesel fuel early credit fuel must be consistent with the credit sulfur diesel fuel may be used in NRLM
program. provisions in today’s rule. Since equipment through May 31, 2014 and in
Any batch of 15 ppm or 500 ppm No. highway diesel fuel volumes are locomotive and marine equipment
1 diesel fuel which is also suitable for determined at the point of delivery from thereafter. Therefore, designate and
use as kerosene or jet fuel (referred to as the refiner/importer to another party, track provisions for heating oil will be
dual-purpose kerosene) may be the anti-downgrade requirements do not needed to ensure that heating oil is not
considered kerosene or jet fuel and need apply to refiners and importers. Under shifted into the NRLM market from June
not be designated as highway or NRLM the highway diesel fuel program, 1, 2007 through May 31, 2014, and to
diesel fuel, even if it may later be refiners that are required to produce 100 the locomotive and marine market
blended into highway or NRLM diesel percent of their highway diesel fuel to thereafter. Consequently, from June 1,
fuel downstream of the refinery to a 15 ppm sulfur standard are provided 2010 through May 31, 2014, refiners and
improve the cold-flow properties of the with an allowance to deliver a small importers must continue to designate
fuel. Upon such blending, the kerosene percentage of 500 ppm sulfur diesel fuel any heating oil they produce as such as
or jet fuel takes on the designation of the to the pipeline (e.g., small refiners and well as any 500 ppm sulfur NRLM
diesel fuel into which it was blended. GPA refiners who exercise an option diesel fuel produced under the small
We expect refiners and importers will under the 2007 highway rule to delay refiner, transmix/segregated interface,
elect to designate all of their 15 ppm compliance with gasoline sulfur and credit provisions.
sulfur No. 1 diesel fuel as highway fuel, standards). This allowance is provided Beginning June 1, 2014, refiners and
since this will aid in their compliance because a small volume of ‘‘line-wash’’ importers may no longer produce or
with the highway program’s 80/20 is typically generated in the feed line import 500 ppm sulfur diesel fuel for
highway fuel production requirement. from the refiner’s facility to the use in NRLM equipment. Therefore,
Designation as highway diesel fuel by pipeline. This line-wash will often be beginning June 1, 2014, all diesel fuel
the refiner will also help avoid suitable for use as 500 ppm sulfur with a sulfur level greater than 15 ppm
downstream blending from causing a highway diesel fuel. Under the must be designated as heating oil, jet
violation by the downstream party provisions of the highway rule this line- fuel, or kerosene. The one exception to
under the tracking and compliance wash could have been excluded from this is transmix processors and
calculations finalized today. We also compliance with the 15 ppm standard if terminals acting as refiners which will
expect that refiners and importers will the refiner accounted for their be permitted to produce 500 ppm sulfur
elect to designate their 500 ppm sulfur production volume prior to shipment. diesel fuel for use in locomotive and
No. 1 fuel as kerosene or jet fuel since However, in this rule, all volume-related marine equipment from transmix and
this will be the predominant use for requirements are keyed to the volume segregated interface.
such fuel, and designating it as highway actually delivered. As a result of this
change in the point of fuel volume iii. Designation of 500 ppm NR and 500
would hinder their compliance with the ppm LM Sulfur Diesel Fuel
measurement (delivered versus
for the purposes of compliance with these produced), we are amending the From June 1, 2010, through May 31,
requirements. highway diesel fuel program 2012, any refiner or importer that
produces or imports 500 ppm sulfur NR limits on the fuel volumes that can be In many cases, we expect that
diesel fuel (small refiner and credit) redesignated, calculated as a volume downstream facilities will not change
and/or 500 ppm sulfur LM diesel fuel balance over a specified compliance the designation of 500 ppm sulfur diesel
must designate all batches of such fuel. period. Specifically, the volumes of 15 fuel from NRLM diesel fuel to highway
The purpose of this designation ppm and 500 ppm sulfur highway while the fuel is in their custody.
requirement is to ensure that 500 ppm received must be compared to the However, to accommodate fluctuations
sulfur LM diesel fuel is not shifted into volumes of these fuels delivered, to in the demand for highway-designated
the NR market. Any 500 ppm sulfur LM ensure that the amount of 15 ppm sulfur versus NRLM-designated 500 ppm
diesel fuel distributed from a refiner’s or highway diesel fuel that is downgraded sulfur fuel, today’s rule allows terminals
importer’s rack not located in the to 500 ppm sulfur highway diesel fuel and other distributors to change the
Northeast/Mid-Atlantic area or Alaska complies with the highway program’s designation of 500 ppm sulfur fuel from
must contain the designated marker and anti-downgrading requirements. The NRLM diesel fuel to highway diesel fuel
red dye, along with heating oil. Any 500 volumes of 500 ppm sulfur highway and on a daily basis, as long as the required
ppm sulfur LM diesel fuel distributed NRLM diesel fuel that a distributor volume balance is achieved over the
from a refiner/importer rack inside of receives must also be compared to the compliance period.124 Terminal
the Northeast/Mid-Atlantic area or volumes of 500 ppm sulfur highway and operators must ensure that the running
Alaska is exempted from the marker NRLM diesel fuel delivered, to ensure balance of total highway-designated fuel
requirement except any 500 ppm sulfur that NRLM diesel fuel was not that they discharged from the beginning
LM fuel that is delivered outside the inappropriately transferred to the of today’s program does not exceed the
Northeast/Mid-Atlantic area must be highway market. The volumes of 500 volume of highway fuel that they
marked. ppm sulfur NR and LM diesel fuel received since, and had in their
received must be compared to the possession at the beginning of today’s
c. Designation and Tracking
volumes of 500 ppm sulfur NR and LM program (adjusted for changes in
Requirements Downstream of the
diesel fuel delivered, to ensure that the inventory). This simple one-sided test
Refinery or Importer
500 ppm sulfur LM fuel was not allows 15 ppm sulfur highway diesel
The result of the refiner/importer inappropriately transferred to the NR fuel to flow to 500 ppm sulfur highway
designation provisions is that all of the market. In addition, the volumes of diesel fuel (subject to anti-downgrading
diesel fuel received by distributors will heating oil received must be compared limits), 500 ppm sulfur NRLM diesel
be clearly and accurately designated. to the volumes distributed to ensure it fuel, or heating oil. It also allows 500
The distributors are then subject to their was not inappropriately transferred to ppm sulfur highway diesel fuel to flow
own designation and tracking the NRLM market. These volume to NRLM diesel fuel or heating oil.
requirements. The downstream balances are calculated over a However, the flow of NRLM diesel fuel
provisions are designed to ensure that compliance period, providing to highway diesel fuel must first have
certain fuel shifts do not occur, such as distributor’s the day to day flexibility to been offset by shifts from highway to
the inappropriate shifting of 500 ppm redesignate fuel based on market NRLM diesel fuel. In this way we can
sulfur NRLM diesel fuel to the highway conditions, as long as the required have assurance that the 500 ppm sulfur
market, the inappropriate shifting of 500 volume balance is achieved over the fuel sold for highway purposes was in
ppm sulfur LM diesel fuel into the compliance period. Finally, once NRLM fact produced pursuant to the 80/20
nonroad market, the inappropriate diesel fuel is dyed, 500 ppm sulfur LM requirements of the highway rule. Since
downgrading of 15 ppm sulfur to 500 diesel fuel is marked (2010–2012), or any 500 ppm sulfur diesel fuel in the
ppm sulfur highway diesel fuel, and the heating oil is marked, the dye and possession of parties downstream of the
inappropriate shifting of heating oil to marker may be used to ensure the fuels refiner at the beginning of today’s
the NRLM market. The downstream are not inappropriately shifted to other program will be considered as highway
provisions are designed to ensure these markets, and the designation, tracking diesel fuel, each custodian will begin
results in a readily enforceable manner and volume balance requirements are no today’s program with a positive
while maximizing downstream longer needed; just the PTD, labeling,
flexibility to address changing market volumetric account balance regarding
and record keeping provisions typical of their input/output of highway-
conditions. our other fuel regulations (e.g., highway
In general, each time custody of designated 500 ppm sulfur. Conformity
diesel) apply. with this requirement will be evaluated
designated fuel is transferred from one In large part, the designate and track
facility to another facility, the transferor by EPA at the end of each quarterly
provisions are structured to be
must designate the fuel and record it’s compliance period.
compatible with the normal business In order to accommodate volumetric
volume. The party who receives custody practices currently used by the industry
must record the same information, to fluctuations due to such factors as
to record and reconcile volume thermal expansion of the fuel, facilities
ensure that each party relies on the transactions between parties. As such,
same designation and volume for its such as pipelines upstream of the
EPA expects that these downstream terminal can use the same volumetric
own compliance purposes. This process provisions can be implemented in a
occurs each time custody of diesel fuel balance. However, since these facilities
fairly straightforward manner. typically do not, and should not change
is transferred. Each distributor may
redesignate fuel while in its custody or i. Designation and Tracking of 500 ppm designations, the compliance periods
when it is delivered, subject to certain and 15 ppm Sulfur Diesel Fuel can be annual. In addition, to ensure
basic requirements. First, any re- From June 1, 2006 through May 31, that there are no significant
designation must be accurate. For 2010, facilities downstream of the redesignations, we are also requiring
example, 500 ppm sulfur NRLM diesel refiner or importer must designate and that the volume of highway-designated
fuel can not be redesignated as 15 ppm maintain records of all volumes of fuel 500 ppm sulfur diesel fuel that a facility
unless it in fact meets the 15 ppm designated as 15 ppm sulfur highway 124 Any party is free to redesignate highway diesel
standard. The sulfur standard applicable diesel fuel, 500 ppm sulfur highway fuel to NRLM diesel fuel or heating oil at any time.
to downstream fuel is based on the diesel fuel, or 500 ppm sulfur NRLM The required volume balance does not limit such
fuel’s designation. Second, there are diesel fuel that they receive and deliver. designations.
discharges from its custody must be no volume balance requirements for high be identified. In such cases, records
greater than 102 percent of the volume sulfur NRLM diesel fuel are met. must be kept regarding the total volume
of such fuel that it received during each The volume balance for heating oil of high sulfur NRLM diesel fuel that is
annual compliance period. All parties requires that the volumes of high sulfur received, discharged, and in inventory
downstream of the refiner, importer, or NRLM diesel fuel and heating oil during each compliance period.
transmix processor also must received must be compared to the From June 1, 2010 through May 31,
demonstrate that over any given volumes of high sulfur NRLM diesel 2014, facilities downstream of the
compliance period, they did not fuel and heating oil delivered over a refiner or importer must continue to
downgrade more than 20 percent of the compliance period. The volume of high designate heating oil and any 500 ppm
15 ppm highway diesel fuel that they sulfur NRLM diesel fuel may not sulfur NRLM diesel fuel that they
received to 500 ppm sulfur highway increase by a greater proportion than the distribute. Beyond June 1 2014, they
diesel fuel. volume of heating oil over a compliance must designate 500 ppm sulfur LM
From June 1, 2006 through May 31, period. There are many reasons why the diesel fuel in addition to heating oil.
2010, distributors must maintain combined pool of high sulfur fuel will Designations for heating oil are subject
records regarding each transfer of a increase in volume such as the to the volume balance requirements and
designated fuel into and out of their inevitable downgrades from 15 ppm and records must be kept on the
facility on a batch-by-batch basis. These 500 ppm when these fuels are shipped designations.
records must include the EPA by pipeline. The volume balance allows Beginning June 1, 2010, the volume
registration number of the source or for this to occur while keeping fuel balance requirement for heating oil is
recipient facility, and the volume of produced as heating oil from being simply that the volume of heating oil
each designated fuel transfer. However, shifted to NRLM diesel fuel. The may not decrease. As discussed
for transfers of dyed NRLM and volume balance calculation allows high previously, there are many reasons why
highway diesel fuel on which taxes have sulfur NRLM diesel fuel and heating oil the volume could increase.
been assessed, the recipient or source to increase proportionately, satisfying Consequently, if the volume decreases it
facility need not be specifically both needs. As discussed previously, would mean that heating oil is being
identified. In such cases, records must high sulfur NRLM diesel fuel and shifted to NRLM or locomotive and
be kept regarding the total volume of heating oil compliance will be required marine uses, thereby allowing refiners
dyed and tax assessed fuel that is on a quarterly basis for terminal to circumvent the NRLM diesel fuel
received, discharged, and in inventory facilities that add marker/dye (and are sulfur standards. Given the likely
during each compliance period. After more likely to change designations on a increase in heating oil volume for other
May 31, 2010, unique records for these day to day basis), while compliance for reasons, there should be ample
designate and track provisions are no other entities (e.g., pipelines) will be on flexibility provided with this one-sided
longer required, but the normal records an annual basis. Compliance with the test to account for minor variations due
and PTDs must still be kept regarding volume balance requirement is to volume swell/shrinkage related to
compliance with the fuel standards. determined by comparing volumes temperature, meter differences, or other
received and delivered during that causes, so no additional tolerance or
ii. Designation and Tracking of High flexibility is necessary.
compliance period. There is no need to
Sulfur NRLM Diesel Fuel and Heating
have a running total volume of high iii. Designation and Tracking of 500
Oil
sulfur NRLM diesel fuel delivered from ppm Sulfur NR and LM Diesel Fuel
The requirements regarding the the beginning of the program since we
designation and tracking of heating oil do not expect any party will need to The requirements regarding the
and high sulfur or 500 ppm sulfur redesignate heating oil to high sulfur designation and tracking of 500 ppm
NRLM diesel fuel parallel those NRLM diesel fuel, even on a day-to-day sulfur NR and LM diesel fuel parallel
regarding the designation and tracking basis. Further, we are not providing any those regarding the designation and
of 500 ppm sulfur highway and NRLM tolerance since sufficient flexibility tracking of 500 ppm sulfur highway and
diesel fuel discussed above. However, already exists due to the many sources NRLM diesel fuel discussed above.
the requirements described below of downgrade to heating oil. However, the requirements described
pertain only to facilities not in the Facilities must maintain records below pertain only to facilities not in
Northeast/Mid-Atlantic area or Alaska, regarding each transfer of heating oil the Northeast/Mid-Atlantic area or
and to facilities inside of the Northeast/ and high sulfur NRLM diesel fuel that Alaska, and to facilities inside of the
Mid-Atlantic area that transport heating they receive and discharge from June 1, Northeast/Mid-Atlantic area that
oil outside of the Northeast/Mid- 2007 through May 31, 2010 on a batch- transport 500 ppm sulfur NR and LM
Atlantic area. by-batch basis.125 These records must diesel fuel outside of the Northeast/Mid-
From June 1, 2007 through May 31, include the EPA registration number of Atlantic area.
2010, facilities downstream of the the source or recipient facility, and the From June 1, 2010 through May 31,
refiner or importer must designate all volume of each fuel transfer. However, 2012, facilities downstream of the
high sulfur diesel fuel they distribute as for transfers of marked heating oil, the refiner or importer must continue to
NRLM diesel fuel and all heating oil recipient or source facility need not be designate 500 ppm sulfur NR and LM
they distribute as heating oil, and must specifically identified. In such cases, diesel fuel that they distribute, and must
keep records of all volumes of fuel records must be kept regarding the total keep records of all volumes of fuel
designated as high sulfur NRLM diesel volume of marked heating oil that is designated as these fuels. In many cases,
fuel or heating oil. In many cases, we received, discharged, and in inventory we expect that downstream facilities
expect that downstream facilities will during each compliance period. For will not change the designation of diesel
not change the designation of diesel fuel transfers of dyed high sulfur NRLM fuel from 500 ppm sulfur LM to 500
from heating oil to high sulfur NRLM diesel fuel from a truck loading rack, the ppm sulfur NR diesel fuel while the fuel
diesel fuel while the fuel is in their specific recipients also do not need to is in their custody. However, today’s
custody. However, today’s final rule final rule provides the flexibility to
provides the flexibility to make this 125 As discussed in section V, these records must make this change in designation
change in designation provided that be kept for five years. provided that volume balance
requirements for 500 ppm sulfur NR d. Reporting Requirements accordingly (e.g., June 1, 2007–
diesel fuel are met. i. Compliance and Reporting Periods September 30, 2007, and April 1, 2010–
The volume balance for 500 ppm May 31, 2010). Quarterly reports are due
sulfur NR and LM diesel fuel requires We believe that any regulatory two months following the end of the
that the volumes of 500 ppm sulfur NR program should promote compliance quarterly compliance period (i.e.,
and LM diesel fuel received must be and deter non-compliance. Today’s December 1, March 1, June 1, and
compared to the volumes of 500 ppm program includes compliance and September 1). Annual compliance
sulfur NR and LM diesel fuel delivered reporting provisions to deter periods begin on July 1 and end June 30
over a compliance period. The volume noncompliance and to detect and of the following year. Again, certain
of 500 ppm sulfur NR diesel fuel may correct instances of noncompliance in a annual compliance periods were
not increase by a greater proportion than timely fashion. Under today’s program lengthened or shortened to match the
the volume of 500 ppm sulfur LM diesel entities must submit to the Agency significant dates of the program (e.g.,
fuel over a compliance period. The compliance reports containing June 1, 2007–June 30, 2008). Annual
combined pool of 500 ppm sulfur diesel information on the diesel fuel volumes reports are due by August 31 following
fuel may increase in volume such as the they handle, separately by fuel the annual compliance period. For the
inevitable downgrades from 15 ppm and designation category. Compliance with sake of simplifying compliance and
500 ppm sulfur diesel fuel when these these volume designation and tracking record keeping, the compliance periods
fuels are shipped by pipeline. The requirements will be determined on an for the highway final rule have been
volume balance allows for this to occur annual basis for refiners and pipelines adjusted to match these.
while keeping fuel produced as 500 and a quarterly basis for terminals Reports must be submitted
ppm sulfur LM diesel fuel from being during the first step of today’s program. electronically, or in a form which
shifted to NR fuel. The volume balance Compliance will be determined on an facilitates direct entry into an electronic
calculation allows 500 ppm sulfur NR annual basis for everyone after 2010. To database. Without reliance on an
and LM diesel fuel to increase demonstrate compliance, refiners, electronic database and reporting
proportionately, satisfying both needs. pipelines, and terminals will be system to cross check and verify
500 ppm sulfur NR and LM diesel fuel required to submit reports on a quarterly reported information, the designate and
compliance will be required on an basis during the first step of today’s track provisions would become so
annual basis, for terminal facilities as program and then on an annual basis cumbersome as to be virtually
well as other entities. Compliance with every year thereafter. unenforceable by EPA staff given
the volume balance requirement is We are requiring the submission of projected resource availability.
determined by comparing volumes volume reports on a quarterly basis
ii. Reporting Requirements During the
received and delivered during that during the first step of today’s program
First Step of Today’s Program
compliance period. for several reasons. First, and most
Facilities must maintain records importantly, today’s program allows During the first step of today’s
regarding each transfer of 500 ppm entities to change the designations of program, from June 1, 2007 through May
sulfur NR and LM diesel fuel that they 500 ppm sulfur diesel fuel from NRLM 31, 2010, entities must report to EPA for
receive and discharge from June 1, 2010 diesel fuel to highway diesel fuel and each of their facilities regarding the total
through May 31, 2012 on a batch-by- heating oil to NRLM diesel fuel on a volume of each of the designated fuels
batch basis. These records must include daily basis (provided that they later that they receive from, or discharge to,
the EPA registration number of the redesignate the same volume of 500 another entity’s facility in the fuel
source or recipient facility, and the ppm diesel fuel from highway diesel distribution system. If a facility is a
volume of each fuel transfer. However, fuel to NRLM diesel fuel and the same refiner as well as a distributor (e.g., a
for transfers of marked 500 ppm sulfur volume of NRLM diesel fuel to heating blender of biodiesel or blendstocks from
LM diesel fuel, the recipient or source oil). Second, quarterly reporting unfinished diesel fuel or heating oil or
facility need not be specifically coupled with quarterly compliance by otherwise both accepts previously
identified. In such cases, records must terminals will constrain the magnitude designated fuel and also produces fuel),
be kept regarding the total volume of of any noncompliance. Finally, during it must also report both volumes
marked 500 ppm sulfur LM diesel fuel the start up of the designate and track produced and released to other entities
that is received, discharged, and in system, there may also be a greater in its capacity as refiner and also report
inventory during each compliance potential for errors in the transmission the volumes received and released for
period. For transfers of dyed 500 ppm of records between custodians of each designation like any other terminal
sulfur NR diesel fuel from a truck designated fuels, in the calculations or pipeline.
loading rack, the specific recipients also related to compliance with the volume For example, an entity that operates a
do not need to be identified. In such account balance requirements, and in pipeline may have multiple points
cases, records must be kept regarding the materials provided in reports. where it discharges fuel, and at each of
the total volume of 500 ppm sulfur NR Today’s program establishes quarterly these points it may supply multiple
diesel fuel that is received, discharged, compliance periods which are based on terminals. The pipeline operator must
and in inventory during each standard industry practices. report on the receipt of designated fuel
compliance period. Specifically, the quarterly compliance from each party that transfers fuel to it,
EPA plans to work closely with periods finalized in today’s rule are as and on the designated fuel transferred
members of the diesel fuel refining and follows: by the pipeline at each discharge point
distribution industry, to provide clear • 1st quarter: July 1–September 30; which specifies the fuel transferred,
and comprehensive guidance on what is • 2nd quarter: October 1–December separately for each of its terminal
expected of the various parties under 31; customers. Entities must report for each
the designate and track and volume • 3rd quarter: January 1–March 31; of their facilities the total volumes of the
balance provisions adopted in this rule. • 4th quarter: April 1–June 30. designated fuels that were either dyed
EPA invites suggestions from these Where the start and end dates of the red, marked, or on which taxes were
parties on the most useful ways to program do not line up with these dates, assessed tax while in their custody.
provide such guidance. the quarters are lengthened or shortened Reports regarding these volumes do not
need to include details on the recipients reporting period is therefore sufficient report the volume of marked 500 ppm
of the fuel (but product transfer and appropriate. sulfur LM diesel fuel separately and
documents must be kept to facilitate Beginning June 1, 2010, entities that indicate the facility from which the
EPA’s ability to compare the outgoing produce, import, or take custody of 500 marked 500 ppm sulfur LM diesel fuel
transfers and to fuel received). ppm sulfur NRLM diesel fuel, marked was received.
Entities that handle only dyed NRLM heating oil, or unmarked heating oil
diesel fuel, dyed and marked 500 ppm outside of the Northeast/Mid-Atlantic E. How Are State Diesel Fuel Programs
sulfur LM diesel fuel (2010–2012) and area and Alaska, must submit an annual Affected by the Sulfur Diesel Program?
heating oil, or highway diesel fuel on report to EPA that provides summary Section 211(c)(4)(A) of the CAA
which taxes have been assessed do not information regarding the transfer of prohibits states and political
need to report to EPA. Information from these fuels.126 Entities must report for subdivisions of states from prescribing
such entities is not needed for each of their facilities the total volume or attempting to enforce, for purposes of
compliance purposes, because there is of each of these fuels that they received motor vehicle emission control, ‘‘any
no chance of violating the prohibitions from, or discharge to, another entity’s control or prohibition respecting any
against the shifting of fuel from one pool facility in the fuel distribution system characteristic or component of a fuel or
to another contained in today’s rule during each annual compliance period. fuel additive in a motor vehicle or motor
without also violating either the For batches of heating oil that are vehicle engine,’’ if EPA has prescribed
requirement that highway diesel fuel delivered marked, the reports do not ‘‘a control or prohibition applicable to
contain no red dye, or the requirement need to indicate the entities to which such characteristic or component of the
that NRLM diesel fuel contain no the batches were delivered—only the fuel or fuel additive’’ under section
heating oil marker. Furthermore, total volume of marked heating oil 211(c)(1). This prohibition applies to all
consistent with the highway rule, there delivered during each compliance states except California, as explained in
are no periodic reporting requirements period must be reported. If an entity section 211(c)(4)(B). This express
regarding the demonstration of only receives marked heating oil (i.e., it preemption provision in section
compliance with the highway program’s does not receive any unmarked heating 211(c)(4)(A) applies only to controls or
anti-downgrading requirements in oil), it does not need to report at all. If prohibitions respecting any
today’s rule. Maintenance of records a facility received marked heating oil in characteristics or components of fuels or
should be sufficient for EPA to addition to unmarked heating oil, it fuel additives for motor vehicles or
adequately monitor compliance with must report the volume of marked motor vehicle engines, that is, highway
these requirements, as insufficient 15 heating oil separately and indicate the vehicles. It does not apply to controls or
ppm sulfur diesel fuel availability in an facility from which the marked heating prohibitions respecting any
area should highlight potential anti- oil was received. characteristics or components of fuels or
downgrading violations. Beginning June 1, 2010 to June 1, fuel additives for nonroad engines or
Quarterly reports from facilities 2012, entities that produce, import, or nonroad vehicles.128
downstream of the refinery and take custody of 500 ppm sulfur NR and Section 211(c)(4)(A) specifically
importer must also include data on the LM diesel fuel outside of the Northeast/ mentions only controls respecting
total volume of the designated fuels Mid-Atlantic area and Alaska, must characteristics or components of fuel or
received, discharged, and in inventory submit an annual report to EPA that fuel additives in a ‘‘motor vehicle or
during the quarterly reporting period. provides summary information motor vehicle engine,’’ adopted ‘‘for
Using these data, the reporting party regarding the transfer of these fuels.127 purposes of motor vehicle emissions
must demonstrate compliance with the Entities must report for each of their control,’’ and the definitions of motor
volume account balance requirements facilities the total volume of each of vehicle and nonroad engines and
regarding highway diesel fuel and high these fuels that they received from, or vehicles in CAA section 216 are
sulfur NRLM. discharge to, another entity’s facility in mutually exclusive. This is in contrast
the fuel distribution system during each to sections 211(a) and (b), which
iii. Reporting Requirements During the specifically mention application to fuels
Second Step of Today’s Program annual compliance period. For batches
of 500 ppm sulfur LM diesel fuel that or fuel additives used in nonroad
We believe that we may safely engines or nonroad vehicles, and with
are delivered marked, the reports do not
dispense with quarterly reporting and section 211(c)(1) which refers to fuel
need to indicate the entities to which
compliance evaluations starting June 1, used in motor vehicles or engines or
the batches were delivered—only the
2010 and instead rely on annual reports. nonroad engines or vehicles.
total volume of marked 500 ppm sulfur Thus, today’s action does not preempt
During the second step of today’s rule,
LM diesel fuel delivered during each state controls or prohibitions respecting
the designate and track requirements
compliance period must be reported. If characteristics or components of fuel or
will be focused on preventing the use of
an entity only receives marked 500 ppm fuel additives used in nonroad,
heating oil in NRLM equipment, and
sulfur LM diesel fuel (i.e., it does not locomotive, or marine engines or
during 2010–2012 preventing the use of
receive any unmarked 500 ppm sulfur
500 ppm sulfur LM diesel fuel in
LM diesel fuel), it does not need to
nonroad equipment. By 2010, all 128 See 66 FR 36543, July 12, 2001 (notice
report at all. If a facility received proposing approval of Houston SIP revisions). See
reporting parties in the system will have
marked in addition to unmarked 500 also letter from Carl Edlund, Director, Multimedia
had experience in complying with the Planning and Permitting Division, U.S.
ppm sulfur LM diesel fuel, it must
program’s designate and track Environmental Protection Agency, Region VI, to
provisions. In addition, the Agency will Jeffrey Saitas, Executive Director, Texas Natural
126 500 ppm sulfur NR diesel fuel, and starting
Resources Conservation Commission, dated
have had ample experience in June 1, 2012, 500 ppm sulfur NRLM diesel fuel, is September 25, 2000, providing comments on
administering the system. Consequently, not permitted in the Northeast/Mid-Atlantic area proposed revisions to the Texas State
we expect that there will be few errors and only in the State of Alaska in limited Implementation Plan for the control of ozone,
or omissions in reports and that EPA circumstances. specifically the Post 99 Rate of Progress Plan and
127 During this time period, 500 ppm sulfur NR Attainment Demonstration for the Houston/
will have determined how best to detect diesel fuel is not permitted in the Northeast/Mid- Galveston area. This letter noted that preemption
and remedy instances of Atlantic area and only in the State of Alaska in under section 211(c)(4) of the CAA did not apply
noncompliance. We believe an annual limited circumstances. to controls on nonroad diesel fuel.
nonroad, locomotive, or marine vehicles range. It boils at a higher average locomotive and marine fuel demand
under the provisions of section temperature than gasoline, No. 1 from analyses supporting EPA’s
211(c)(4)(A). At the same time, a state distillate, jet fuel and kerosene, and at locomotive and marine engine
control that regulates both highway fuel a lower average temperature than rulemaking. These future levels of
and nonroad fuel is preempted to the residual fuel (or bunker fuel). ASTM NRLM fuel demand differed from those
extent that the state control respects a defines three No. 2 distillate fuels: (1) implicit in our projection of the
characteristic or component of highway Low sulfur No. 2 diesel fuel (No. 2–D); emission reductions associated with the
fuel regulated by EPA under section (2) high sulfur No. 2–D; and (3) No. 2 rule, which were based primarily on
211(c)(1). fuel oil.129 Low sulfur No. 2–D fuel EPA’s NONROAD emission model. We
A court may consider whether a state must contain 500 ppm sulfur or less, pointed out this inconsistency in the
control for fuels or fuel additives used have a minimum cetane number of 40, rule and indicated that we would
in nonroad engines or nonroad vehicles and have a minimum cetane index limit resolve this inconsistency for the final
is implicitly preempted under the of 40 (or a maximum aromatic content rule.
supremacy clause of the U.S. of 35 volume percent) (i.e., meet the In their comments on the NPRM, the
constitution. Courts have determined EPA standard for highway diesel American Petroleum Institute (API), the
that a state law is preempted by federal fuel).130 Both high sulfur No. 2–D and Engine Manufacturers Association
law where the state requirement No. 2 fuel oil must contain no more than (EMA) and others highlighted this
actually conflicts with federal law by 5000 ppm sulfur,131 and currently inconsistency and suggested that EPA
preventing compliance with the federal averages 3000 ppm nationwide. The resolve it by basing its projection of
requirement, or by standing as an ASTM specification for high sulfur No. future NRLM fuel demand using
obstacle to accomplishment of 2–D fuel also includes a minimum information developed by EIA and not
congressional objectives. A court could cetane number of 40. Practically, since from the NONROAD emission model.
thus consider whether a given state most No. 2 fuel oil meets this minimum API pointed to a lower estimate of
standard for sulfur in nonroad, cetane number specification, pipelines nonroad fuel demand developed in a
locomotive or marine diesel fuel is which ship fuel fungibly need only contracted study performed by Baker
preempted if it places such significant carry one high sulfur No. 2 distillate and O’Brien. A detailed analysis of
cost and investment burdens on refiners fuel which meets both sets of these comments and additional
that refiners cannot meet both state and specifications. Currently, nonroad, technical analyses of distillate fuel
federal requirements in time, or if the locomotive and marine engines can be demand are described in Section 4.6.3.1
state control would otherwise meet the and are fueled with both low and high of the Summary and Analysis document
criteria for conflict preemption. sulfur No. 2–D fuels. If No. 1 distillate to this rule. In summary, we decided to
is blended into highway diesel fuel, as continue using the NONROAD emission
F. Technological Feasibility of the 500
is sometimes done to prevent gelling in model to project the emission benefits of
and 15 ppm Sulfur Diesel Fuel Program
the winter, the final blend must meet this rule. To eliminate the inconsistency
This section summarizes our in the NPRM, we also use the
the 500 ppm EPA cap.
assessment of the feasibility of refining No. 1 distillate (e.g., jet fuel and NONROAD model to determine demand
and distributing 500 ppm NRLM diesel kerosene) meets lower boiling point and for nonroad fuel and project the
fuel starting in 2007 and 15 ppm viscosity specifications requirements economic impacts of this final rule.
nonroad diesel fuel in 2010 and than No. 2 distillate. No. 1 distillate, or However, the analyses presented in
locomotive and marine diesel fuel in any of these other similar boiling Section 4.6.3.1 of the Summary and
2012. Based on this evaluation, we distillates, added to No. 2 NRLM Analysis document to this rule
believe it is technologically feasible for distillate becomes NRLM diesel fuel and identified uncertainties in the current
refiners and distributors to meet both thus, must meet the applicable and future level of nonroad fuel
sulfur standards in the lead time specifications for No. 2 distillate. demand. To insure that these
provided with the desulfurization For the purpose of this rule, we split uncertainties did not affect the outcome
technology available. We begin this the No. 2 distillate market into three of this rulemaking process, we evaluate
section by describing the nonroad, pieces, according to the sulfur standard the emissions, costs and cost
locomotive and marine diesel fuel which each must meet: (1) Highway effectiveness of the standards contained
market and how these fuels differ from diesel fuel, (2) NRLM diesel fuel, and in this rule using an alternative estimate
current highway diesel fuel. We discuss heating oil, which is used in both of nonroad fuel demand derived from
desulfurization technologies, both furnaces and boilers, as well as in EIA information. This alternative
conventional and advanced, which are stationary diesel engines to generate analysis is presented in Appendix 8A of
available for complying with the 500 power. the Final RIA. In addition to use of the
ppm and 15 ppm NRLM standards. We In the NPRM, EPA estimated current NONROAD model to project nonroad
then present what mix of technologies production and demand for NRLM fuel fuel demand, we also updated our
we believe will be used. Next we from studies conducted by the U.S. projections of the production of and
provide our analysis of the lead time for Energy Information Administration demand for highway fuel and heating
complying with either standard. Finally, (EIA). We projected growth in nonroad oil using more recent versions of the
we analyze the feasibility of distributing fuel demand using EPA’s NONROAD same EIA reports used in the NPRM
low sulfur NRLM diesel fuel. We refer emission model. We based the growth in analysis.
the reader to the Final RIA for more In 2001, nationwide outside of
details regarding these assessments. 129 ‘‘Standard Specification for Diesel Fuel Oils,’’ California, nonroad diesel fuel
ASTM D 975–98b and ‘‘Standard Specifications for comprised about 18 percent of all No. 2
1. What Is the Nonroad, Locomotive and Fuel Oils,’’ ASTM D 396–98. distillate fuel, while locomotive and
Marine Diesel Fuel Market Today? 130 These ASTM requirements were formed after
marine diesel fuel comprised about
Nonroad, locomotive and marine and are consistent with the EPA regulations for eight percent of all No. 2 distillate fuel.
highway diesel fuel.
(NRLM) engines almost exclusively use 131 Some states, particularly those in the Diesel fuel consumed by highway
No. 2 distillate fuel. No. 2 distillate fuel Northeast, limit the sulfur content of No. 2 fuel oil vehicles/engines comprised about 56
is a class of fuel defined by its boiling to 2000–3000 ppm. percent of all No. 2 distillate fuel.
Heating oil comprised about 19 percent hydrotreater to meet the 15 ppm specific refiner’s situation should be
of No. 2 distillate. Because of limitations standard in 2010 and 2012. EPA relatively short.
in the fuel distribution system and other therefore projects that the 500 ppm Twenty-six out of the 36 refineries
factors, about 18 percent of all non- sulfur cap NRLM standard will be met projected to produce 500 ppm NRLM
highway distillate met the 500 ppm using conventional hydrotreating diesel fuel in 2007 have indicated that
highway diesel fuel cap. Thus, about 64 technology. We made this same they will produce highway diesel fuel in
percent of No. 2 distillate pool met the projection in the NPRM and no their highway diesel fuel pre-
500 ppm sulfur cap, not just the 56 comments to the contrary were received. compliance reports, see RIA section
percent used in highway vehicles. We In some cases, refiners will also need 7.2.1.3.4.1, Table 7.2.1–38 and following
project that this spillover of highway to install or expand several ancillary discussion for description of these
fuel to the NRLM diesel fuel market will processes related to sulfur removal (e.g., refineries. Thus, roughly 70% of the
continue under the highway diesel fuel hydrogen production and purification, refiners likely to produce 500 ppm
program. Thus, today’s rule will only sulfur processing, and sour water sulfur NRLM diesel fuel in 2007 are
materially affect about 19 percent of treatment). These technologies are all already well into their planning for
today’s distillate market. The remaining commercially demonstrated, as nearly meeting the 15 ppm highway diesel fuel
17 percent of No. 2 distillate which is all refineries already have such units. standard, effective June 1, 2006. It is
high sulfur heating oil is estimated to likely that these refiners have already
remain at higher sulfur levels. 3. Is the Leadtime Sufficient To Meet chemically characterized their high
This rule will also affect any No. 1 the 2007 500 ppm NRLM Sulfur sulfur diesel fuel blendstocks, as well as
distillate which is blended into Standard? their highway diesel fuel, in assessing
wintertime NRLM fuel. Because gelling After the highway diesel fuel program how to meet produce 15 ppm fuel. They
can also be prevented through the use is implemented, we project that 92 will also have already assessed the
of pour point additives, the current and refineries in U.S. will be producing high various technologies for producing 15
future level of this of No. 1 distillate sulfur distillate fuel. We project that 36 ppm diesel fuel. This provides an
blending is uncertain. However, the of these refineries will likely produce extensive base of information on how to
feasibility of desulfurizing and 500 ppm sulfur NRLM diesel fuel in design a hydrotreater to produce 500
distributing this No. 1 distillate will also 2007. Of those 36, 30 will have to build ppm NRLM fuel, as well as how to
be addressed below. new hydrotreaters while the other 6 are revamp this hydrotreater to produce 15
expected to use existing hydrotreaters to ppm NRLM diesel fuel in 2010 and
2. What Technology Will Refiners Use
produce 500 ppm NRLM diesel fuel.132 2012. Those refiners only producing
To Meet the 500 ppm Sulfur Cap?
The remaining 56 refineries are high sulfur distillate fuel today will be
Refiners currently hydrotreat most or projected to continue to produce high able to take advantage of the significant
all of their distillate blendstocks using sulfur distillate fuel, with 26 of the 56 experience that technology vendors
what is commonly referred to as refineries producing heating oil. The have obtained in assisting refiners of
‘‘conventional’’ hydrotreating other 30 refineries are owned by small highway diesel fuel meet the 15 ppm
technology to meet the 500 ppm sulfur refiners and will likely produce high cap in 2006.
and cetane limits applicable to highway sulfur NRLM diesel fuel. The 56 We also expect that roughly 20
diesel fuel. This conventional refineries continuing to produce high percent of the 101 refineries in the U.S.
technology has been available and in sulfur distillate will not have to add or and its territories will build a new
use for many years. U.S. refiners have modify any equipment to continue hydrotreater to produce 15 ppm
nearly ten years of experience with this producing this fuel. highway fuel. Those which also produce
technology in producing highway diesel This rule will provide refiners and high sulfur distillate will be able to
fuel. The distillate blendstocks importers 37 months before they will produce 500 ppm NRLM fuel with their
comprising NRLM fuel do not differ have to begin producing 500 ppm existing highway hydrotreater. In 2007,
substantially from those comprising NRLM diesel fuel on June 1, 2007. Our we conservatively assumed that 20% of
highway diesel fuel. Thus, the lead time analysis projects that 27–39 the 500 ppm NRLM production from
technology to produce 500 ppm sulfur months are typically needed to design refineries that produce highway and
NRLM diesel fuel has clearly been and construct a diesel fuel high sulfur distillate could be produced
demonstrated and optimized over the hydrotreater.133 As discussed below, we with these existing treaters at no capital
last decade. Additionally, this believe that 37 months will be sufficient costs (existing highway treater capacity
technology continues to evolve for all refiners of NRLM fuel. available for 500 ppm NRLM production
primarily through the development of Easing the task is the fact that we would be higher if based on highway
more active catalysts and motivated by project that essentially all refiners will treater capacity). Thus, in 2007 we
the 15 ppm cap applicable to most use conventional hydrotreating to project that four refineries will be able
highway diesel fuel starting in 2006. comply with the 500 ppm sulfur NRLM to use their recently idled highway
Several advanced desulfurization diesel fuel cap. This technology has treater due to building a new highway
technologies are being developed and been used extensively for more than 10 treater unit for 2006. Furthermore, the
are discussed in more detail in the next years and its capabilities to process a highway diesel program pre-compliance
section. However, the fact that none of wide range of diesel fuel blendstocks are reports indicate that another 7 refineries
these technologies have been well understood. Thus, the time currently producing 500 ppm highway
demonstrated commercially for a typical necessary to apply this technology for a fuel will likely leave the highway fuel
catalyst life (i.e., two years) makes it market in 2006. We project that 2 of
unlikely that they would be selected by 132 These refiners have said that they will leave these would use their existing treater to
many refiners for use in mid-2007. Also, the highway market in 2006 in their pre-compliance produce 500 ppm NRLM with no
these advanced technologies promise reports for complying with the Highway Diesel investment costs. Another three of these
the greatest cost savings in achieving 15 Rule, thus freeing up their existing hydrotreaters to 101 refineries produce relatively small
produce 500 ppm NRLM diesel fuel.
ppm levels, rather than 500 ppm. These 133 ‘‘Highway Diesel Progress Review,’’ USEPA, volumes of high sulfur distillate
advanced technologies can also be EPA420–R–02–016, June 2002. The leadtime compared to highway diesel fuel today.
combined with a conventional analysis in the RIA can be found in section 5.3. We project that they will be able to
produce 500 ppm sulfur NRLM fuel ppm diesel fuel. Thus, we continue to Dynamics IsoTherming, improves the
from their high sulfur distillate with believe that advanced technologies will contact between hydrogen, diesel fuel
only minor modification to their be used to produce a large percentage of and the desulfurization catalyst. The
existing highway diesel fuel 15 ppm NRLM fuel. However, the IsoTherming process dissolves the
hydrotreater. number of advanced technologies used hydrogen in the liquid fuel phase prior
Refiners not planning on producing may be smaller. Because of the more to passing the liquid over the catalyst,
100 percent highway fuel in 2006 will limited choices, we project that the eliminating the need for a two-phase
also need some time to assess which penetration of advanced technologies (gas and liquid) reactor. The liquid, plug
distillate market in which to participate will be only 60 percent. The remainder flow reactor design also avoids the poor
starting in 2007, NRLM or heating oil. of this section discusses the production liquid distribution over the catalyst bed
While this is a decision which requires of 15 ppm diesel fuel using often present in a two-phase reactor
some amount of time for analysis, conventional and advanced design. Process Dynamics projects that
refiners also needed to assess what technologies. their IsoTherming process could reduce
market they would participate in for the One approach to produce 15 ppm the hydrotreater volume required to
1993 500 ppm highway diesel fuel NRLM fuel would be to revamp the achieve sub-15 ppm sulfur levels by
sulfur cap. In all, we project that the conventional hydrotreater built to roughly a factor of two.
task of producing 500 ppm sulfur NRLM produce 500 ppm NRLM fuel in 2007. Process Dynamics has already built a
fuel in 2007 will be less difficult than Knowing that the 500 ppm NRLM cap commercial-sized demonstration unit
the task refiners faced with the will only be in effect for three years for (5000 barrels per day) at a refinery in
implementation of the 500 ppm nonroad refiners and five years for New Mexico. They have been operating
highway diesel fuel cap in 1993. locomotive and marine refiners (four the unit since September 2002, and
Refiners had just over three years of lead years for small refiners), we expect that demonstrating the capability to meet a
time for complying with the 1993 500 refiners will design their 500 ppm 15 ppm cap since the spring of 2003.
ppm highway diesel fuel cap, as is the hydrotreater to allow the production of Thus, refiners will have 4–5 years of
case here, and this proved sufficient. 15 ppm fuel through the addition of operating data on this process before
No explicit comments were made by reactor volume or a second they would have to select a technology
refiners on the lead time needed for hydrotreating stage. Refiners might also to produce 15 ppm nonroad diesel fuel
complying with the proposed NRLM shift to a more active catalyst in the in 2010, and 6–7 years before producing
500 ppm sulfur standard. However, existing reactor, as the life of that 15 ppm locomotive and marine diesel
their comments supported the two step catalyst might be nearing its end. fuel in 2012. This should be more than
approach, preferring it over a one step, Equipment to further purify its sufficient for essentially all refiners to
15 ppm NRLM cap starting in 2008. hydrogen supply could also be added. consider this process for 2010 or 2012.
4. What Technology Will Refiners Use Producing 15 ppm NRLM fuel via these Based on information received from
To Meet the 15 ppm Sulfur Cap? steps will be feasible as they are Process Dynamics, we estimate that this
essentially the same steps refiners will technology could reduce the cost of
In the highway diesel rule, we be using in 2006 to produce 15 ppm meeting the 15 ppm cap for many
projected that refiners producing 15 highway diesel fuel. refiners by about 30 percent. This
ppm fuel in 2006 would utilize EPA recently reviewed the progress savings arises from a smaller reactor,
extensions of conventional being made by refining technology less catalyst and avoiding the need for
hydrotreating technology. We also vendors and refiners in meeting the a recycle gas compressor and reactor
projected that refiners first producing 15 2006 highway diesel sulfur cap.134 All distributor. Refineries facing poorer
ppm fuel in 2010 would use a mix of evidence available confirms EPA’s economies of scale, such as small
extensions of conventional and projection that conventional refineries, would particularly benefit
advanced technologies. Based on the hydrotreating will be capable of from this desulfurization process.
refiners’ highway pre-compliance producing diesel fuel containing less A second process being developed to
reports, it appears that 95% of highway than 10 ppm sulfur. Furthermore, as produce 15 ppm diesel fuel is the
fuel could meet the 15 ppm cap in 2006. part of the highway program’s reporting Unipure oxidation process. This process
We expect that virtually all of this 15 requirements, refiners are required to oxidizes the sulfur in distillate
ppm fuel will be produced with report their progress in complying with molecules, facilitating its removal.
conventional hydrotreating. Thus, it the 15 ppm highway diesel fuel Unipure Corporation installed a small
appears that conventional hydrotreating standard. In those reports they indicated (50 barrels per day), continuous flow
will be used to produce the vast that they primarily will be applying demonstration unit at Valero’s Krotz
majority of 15 ppm highway diesel fuel. extensions of conventional Spring refinery in the spring of 2003. It
In the nonroad NPRM, we projected hydrotreating. NRLM fuel refiners will appears that this technology could
that refiners would use advanced have the added advantage of being able reduce the cost of producing 15 ppm
desulfurization technologies to produce to design their 500 ppm hydrotreater diesel fuel for some refiners compared
80 percent of 15 ppm nonroad diesel with the production of 15 ppm fuel in to conventional hydrotreating. However,
fuel in 2010, with the balance using mind. Additionally, refiners producing the small size of the demonstration unit
conventional hydrotreating. At the time 15 ppm NRLM fuel will be able to take may make the risk associated with a
of the NPRM, all of the advanced advantage of the experience gained from new technology too large. Thus, we
technologies appeared to be progressing those producing 15 ppm highway fuel. believe that this technology needs be
rapidly. Since the proposal, we have As mentioned above, several demonstrated further before most
learned that a couple of these advanced technologies are presently refiners will seriously considered it for
technologies, Unipure and S-Zorb, are being developed to produce 15 ppm commercial application. This
not going to be commercially diesel fuel at lower cost. One of these technology, however, may be ideal for
demonstrated as soon as expected. advanced technologies, Process use at transmix processing plants or
However, one refiner is already using large terminals to reprocess 15 ppm
Process Dynamics’ IsoTherming 134 ‘‘Highway Diesel Progress Review,’’ USEPA, diesel fuel which have become
technology to commercially produce 15 EPA420–R–02–016, June 2002. contaminated during shipment. We
discuss this distillate downgrade in 5. Is the Leadtime Sufficient To Meet IsoTherming process before having to
greater detail in Section VI.A.2 of this the 2010 and 2012 15 ppm NRLM Sulfur make their technology selections for
preamble. This oxidation process avoids Cap? 2010 and 2012 . This should be more
the need for high pressure hydrogen, We project that 32 refineries will than adequate to fully access the costs
which is usually not economically produce 15 ppm nonroad diesel fuel in and capabilities of this technology for
available at these smaller facilities. 2010, with two of these being owned by all but the most cautious refiners.
Considering the amount of leadtime
Finally, Conoco-Phillips has adapted small refiners. In 2012, we project that
available and the desulfurization
their S–Zorb adsorption technology 15 refineries will produce 15 ppm
technologies which will be available
which was originally designed for locomotive and marine diesel fuel. We
and proven for complying with a 15
gasoline desulfurization, for diesel fuel project that an additional 15 refineries
ppm sulfur standard, we do not expect
desulfurization. At the time of the will produce 500 ppm nonroad diesel
that the leadtime for complying with the
NPRM, Conoco-Phillips had signed 23 fuel in 2010 under the small refiner
15 ppm NRLM cap standard in 2010 and
licensing agreements with refiners in provisions included in the today’s final
2012 will be an issue for refiners.
North America regarding the use of S- rule. Then in 2014, we project that the
Zorb to comply with the Tier 2 gasoline 15 refineries exempted under the small 6. Feasibility of Distributing 500 and 15
sulfur standards. Furthermore, Conoco- refiner provisions will begin producing ppm NRLM Fuel
Phillips had plans for the quick 15 ppm NRLM diesel fuel in 2014. There are two considerations with
installation of an S-Zorb unit to The timing of this rule provides respect to the feasibility of distributing
demonstrate the production of 15 ppm refiners and importers with more than non-highway diesel fuels meeting the
diesel fuel. However, we have since six years before they will have to sulfur standards in today’s rule. The
learned that Conoco-Phillips has produce 15 ppm nonroad diesel fuel, first pertains to whether sulfur
and two years more for producing 15 contamination can be adequately
dropped its plans to build a commercial
ppm locomotive and marine diesel fuel. managed throughout the distribution
demonstration unit for desulfurizing
Our leadtime analysis, which is system so that fuel delivered to the end-
diesel fuel. Without a commercial unit
presented in Section 5.4.2 of the Final user does not exceed the specified
operating in the 2006 time frame, we do
RIA, projects that 30–39 months are maximum sulfur concentration. The
not believe that many refiners will
typically needed to design and construct second pertains to the physical
seriously consider S-Zorb to produce 15 a diesel fuel hydrotreater, perhaps less
ppm NRLM diesel fuel in 2010 and limitations of the system to
if it is a Process Dynamics unit. Thus, accommodate any additional
2012. refiners will have about three years segregation of product grades.
Due to the fact that the Process before they would have to begin
Dynamics IsoTherming process is detailed design and construction for a. Limiting Sulfur Contamination
already operating commercially and 2010, and five years before 2012. This With respect to limiting sulfur
operational data indicate a 30 percent will allow sufficient time to consult contamination during distribution, the
reduction in the cost of producing 15 with vendors, test their diesel fuel in physical hardware and distribution
ppm fuel relative to conventional pilot plants to assess the difficulty of its practices for non-highway diesel fuel do
hydrotreating, we project that 60 desulfurization via a variety of not differ significantly from those for
percent of the new volume of 15 ppm technologies, and to select its highway diesel fuel. Therefore, we do
NRLM diesel fuel will be produced technology for 2010 and 2012. In not anticipate any new issues with
using this technology. We project that addition, these refiners will also have respect to limiting sulfur contamination
the remaining 40 percent of 15 ppm the chance to observe the performance during the distribution of non-highway
NRLM diesel fuel will use extensions of of the hydrotreaters being used to fuel that would not have already been
conventional hydrotreating. We assume produce 15 ppm highway diesel fuel for accounted for in distributing highway
this 60/40 mix of Isotherming and at least one year for those complying in diesel fuel. Highway diesel fuel has
extensions of conventional 2010, and two years more for those been required to meet a 500 ppm sulfur
hydrotreating, respectively, for 2010, complying in 2012. While not a full standard since 1993. Thus, we expect
2012 and even for 2014 when the small catalyst cycle, any unusual degradation that limiting contamination during the
refiners exemptions expire. in catalyst performance should be distribution of 500 ppm non-highway
apparent within the first year. Based on diesel engine fuel can be readily
API commented that the advanced the pre-compliance reports, some accomplished by the industry. This
desulfurization technologies have not refineries in the U.S. will be producing applies to locomotive and marine diesel
been commercially demonstrated and 15 ppm sulfur highway diesel fuel fuel as well as nonroad diesel fuel.
thus should not be used as the basis for earlier than 2006. Some refineries are In the highway diesel rule, EPA
estimating the cost of desulfurizing expected to produce complying fuel acknowledged that meeting a 15 ppm
NRLM diesel fuel to 15 ppm. While this earlier than the compliance date in sulfur specification would pose a
is true for the Unipure oxidation and Europe as well. The refineries which are substantial new challenge to the
Conoco-Phillip’s S-Zorb processes, the complying early will accrue experience distribution system. Refiners, pipelines,
Process Dynamics IsoTherming process earlier and longer providing refiners a and terminals would have to pay careful
has been commercially demonstrated. It better sense of the reliability of attention to and eliminate any potential
is therefore appropriate for use as a producing 15 ppm diesel fuel. Thus, we sources of contamination in the system
partial basis for the refining costs project that the 2010 and 2012 start (e.g., tank bottoms, deal legs in
associated with today’s final rule. To dates will allow refiners to be quite pipelines, leaking valves, interface cuts,
indicate the effect that this projection certain that the designs they select in etc.). In addition, bulk plant operators
for the use of IsoTherming has on the mid-2007 will perform adequately in and delivery truck operators would have
rule’s cost, in Section 7.2.2 of the Final 2010 and 2012. to carefully observe recommended
RIA, we estimate the cost of producing In addition, refiners will have three to industry practices to limit
15 ppm NRLM fuel with only the use of four years or more to observe the contamination, including practices as
conventional hydrotreating technology. performance of the Process Dynamics simple as cleaning out transfer hoses,
proper sequencing of fuel deliveries, product segregation. This is not to say in areas outside of the Northeast (where
and parking on a level surface when that additional steps will not have to be most heating oil is used). If the market
draining the storage tank. Due to the taken. However, this program will result for this fuel was limited, it would have
need to prepare for compliance with the in only a limited number of entities in to be trucked back to a refinery to be
highway diesel program, we anticipate the distribution system choosing to add desulfurized which could raise
that issues related to limiting sulfur new tankage due to new product significant logistical and cost issues.
contamination during the distribution of segregation. Bulk plants in areas of the Consequently, today’s rule provides that
15 ppm NRLM diesel fuel will be country where heating oil is expected to 500 ppm sulfur diesel fuel produced
resolved well in advance of the 2010 remain in the market will have to decide due to interface mixing can continue to
and 2012 implementation dates . We are whether to add tankage to distribute be used in nonroad equipment until
not aware of any additional issues that both heating oil and 500 ppm sulfur 2014 (subject to specific sulfur
might arise unique to NRLM diesel fuel. NRLM fuel. Terminal operators requirements for new equipment), and
If anything we anticipate limiting commented that the proposed presence in locomotive and marine engines
contamination will become easier as of a fuel marker in heating oil would indefinitely.139 These provisions ensure
batch sizes are allowed to increase and make it impossible for them to blend that there will be a sufficient market for
potential sources of contamination 500 ppm sulfur diesel from 15 ppm such 500 ppm sulfur diesel fuel.
decrease as more and more of the diesel sulfur and high sulfur fuels. They
pool turns over to 500 and 15 ppm G. What Are the Potential Impacts of the
related that this ability would be
sulfur. Industry representatives 15 ppm Sulfur Diesel Program on
important to certain terminal operators
acknowledge that the task can be Lubricity and Other Fuel Properties?
who would not have the storage
accomplished. However, they are still in facilities available for three grades of 1. What Is Lubricity and Why Might It
the process of identifying all of the diesel fuel, but would still not wish to Be a Concern?
measures that will need to be taken. forgo selling 500 ppm diesel fuel.136 Engine manufacturers and owner/
b. Potential Need for Additional Product Today’s rule allows the required marker operators depend on diesel fuel
Segregation to be added to heating oil before it lubricity properties to lubricate and
leaves the terminal (see section IV.D of protect moving parts within fuel pumps
As discussed in section IV.D, we have this preamble). Therefore, terminals will
designed the NRLM diesel fuel program and injection systems for reliable
be able to blend 500 ppm diesel from 15 performance. Unit injector systems and
to minimize the need for additional ppm and high sulfur diesel fuels,
product segregation and the feasibility in-line pumps, commonly used in diesel
provided they fulfill all of the engines, are actuated by cams lubricated
and cost issues associated with it. This responsibilities associated with acting
final rule allows for the fungible with crankcase oil, and have minimal
as a fuel refiner (see section V of this sensitivity to fuel lubricity. However,
distribution of 500 ppm highway and preamble).137 However, because this
500 ppm sulfur NRLM diesel fuel in rotary and distributor type pumps,
will be a relatively costly way of commonly used in light and medium-
2007, and 15 ppm highway and 15 ppm producing 500 ppm diesel fuel, we do
NR diesel fuel in 2010 and 15 ppm duty diesel engines, are completely fuel
not expect that the practice will be lubricated, resulting in high sensitivity
NRLM diesel fuel in 2012, up until the
widespread. In all other cases we to fuel lubricity. The types of fuel
point where NRLM, LM, or nonroad fuel
anticipate segments of the distribution pumps and injection systems used in
must be dyed for IRS excise tax
system will choose to avoid any fuel nonroad diesel engines are the same as
purposes. We proposed that heating oil
segregation costs by limiting the range those used in highway diesel vehicles.
would be required to be segregated
of sulfur grades they choose to carry, Consequently, nonroad and highway
throughout the distribution system by
just as they do today. Regardless, diesel engines share the same need for
the use of a marker added at the refiners
however, the costs and impacts of these adequate fuel lubricity to maintain fuel
from 2007 through 2010. We received
choices are small. A more detailed pump and injection system durability.
comments that addition of the marker at
explanation of this assessment can be Diesel fuel lubricity concerns were
the refinery would cause significant
concerns regarding potential marker found in chapter 7 of the RIA. first highlighted for private and
A limited volume of 500 ppm sulfur commercial vehicles during the initial
contamination in the jet fuel. In
diesel fuel is projected to be produced implementation of the federal 500 ppm
responding to these and other
downstream due to interface mixing in sulfur highway diesel program and the
comments, we have chosen to adopt a
the distribution system (see section state of California’s diesel program. The
designate and track system of ensuring
IV.A).138 Fuel from these sources is Department of Defense (DoD) also has a
refiner compliance with desulfurization
currently sold into the NRLM and longstanding concern regarding the
requirements (see IV.D.). This allows the
heating oil markets. The lubricity of distillate fuels used in its
point of marker addition to be moved
downstream to the terminal where such implementation of the 15 ppm sulfur equipment as evidenced by the
contamination concerns are minimal. As standard for NR diesel fuel in 2010 and implementation of its own fuel lubricity
a result heating oil and high-sulfur for LM diesel fuel in 2012 raises the improver performance specification in
NRLM will also be fungible in the concern that the heating oil market 1989.140 The diesel fuel requirements in
distribution system up to the point might be insufficient to absorb all such the state of California differed from the
where the fuel marker must be added at downstream 500 ppm sulfur diesel fuel
the terminal.135 136 15
139 While today?s rule does not contain an end
ppm diesel fuel and high sulfur heating oil date for the downstream distribution of 500 ppm
The design of today’s fuel program will be the largest volume products at such sulfur locomotive and marine fuel, we will review
eliminates any potential feasibility terminals. the appropriateness of allowing this flexibility
issues associated with the need for 137 The definition of a refiner includes persons based on experience gained from implementation of
who produce highway or NRLM diesel fuel by the 15 ppm sulfur NRLM diesel fuel standard. We
135 The fuel marker requirements only apply blending. expect to conduct such an evaluation in 2011.
138 This fuel will be produced by transmix 140 DoD Performance Specification, Inhibitor,
outside of the Northeast/Mid-Atlantic area. Inside
the Northeast/Mid-Atlantic area, high sulfur NRLM processors and at terminals by segregating the Corrosion/Lubricity Improver, Fuel Soluble, MIL–
cannot be sold to end users. See section IV.D for pipeline interface between 15 ppm diesel fuel and PRF–25017F, 10 November 1997, Superseding MIL–
a detailed discussion of the fuel marker provisions. jet fuel. I–25017E, 15 June 1989.
federal requirements by substantially the lubricity of conventional diesel fuel. highway and nonroad engines are the
restricting the aromatic content of diesel Indications are that low concentrations same, and the potential decrease in
fuel which requires more severe of biodiesel might be sufficient to raise lubricity from desulfurization of NRLM
hydrotreating than reducing the sulfur the lubricity to acceptable levels. diesel fuel would be no greater than that
content to meet a 500 ppm standard.141 Biodiesel is a renewable fuel made from experienced in desulfurizing highway
Consequently, concerns regarding diesel agricultural sources such as soybean oil, diesel fuel, we estimate that the
fuel lubricity have primarily been peanut oil and other vegetable oils as potential need for lubricity additives in
associated with California diesel fuel well as rendered and animal fats and NRLM diesel fuel under today’s action
and some California refiners treat their recycled cooking oils. Biodiesel would be the same as that for highway
diesel fuel with a lubricity additive as generally contains very low amounts of diesel fuel meeting the same sulfur
needed. Outside of California, sulfur, which is an attractive standard.
hydrotreating to meet the current 500 characteristic for use in diesel engines
ppm sulfur specification does not using advanced aftertreatment systems. a. Farm and Mining Equipment
typically result in a substantial Additionally, biodiesel, by virtue of its The types of fuel pumps and injection
reduction of lubricity. Diesel fuels lubricity properties, may be a good systems used in the nonroad diesel
outside of California seldom require the alternative to additives currently used to engines found in farm and mining
use of a lubricity additive. Therefore, we ensure adequate fuel lubricity. equipment are similar to those used in
anticipate only a marginal increase in According to the U.S. Department of highway diesel vehicles.144 The
the use of lubricity additives in NRLM Agriculture, there is a current capacity hydrotreating process for generating 500
diesel fuel meeting the 500 ppm sulfur to produce 100 million gallons ppm diesel fuel will not adversely effect
standard for 2007.142 Today’s action annually. Thus, we believe that fuel injection equipment in farm and
requires diesel fuel used in nonroad, biodiesel is a feasible technology that mining equipment based on the use of
locomotive, and marine diesel engines could help support today’s clean diesel comparable injection systems in
to meet a 15 ppm sulfur standard in fuel program. highway diesel vehicles. We believe that
2010 and 2012, respectively. Based on Research remains to be performed to the use of lubricity additives in 15 ppm
the following discussion, we believe better understand which fuel sulfur NRLM diesel fuel will be required
that the increase in the use of lubricity components are most responsible for and result in adequate protection of fuel
additives in 15 ppm sulfur NRLM diesel lubricity. Consequently, it is unclear injection equipment and is similar to
fuel would be the same as that estimated whether and to what degree the sulfur that needed for 15 ppm sulfur highway
for 15 ppm highway diesel fuel. standards for NRLM diesel fuel will diesel fuel.
The state of California currently impact fuel lubricity. Nevertheless,
requires the same standards for diesel there is evidence that the typical b. Locomotives
fuel used in nonroad equipment as in process used to remove sulfur from One of the locomotive manufacturers
highway equipment. Outside of diesel fuel ‘‘hydrotreating’’ can impact expressed concern in its comments that
California, highway diesel fuel is often lubricity depending on the severity of low sulfur fuel might damage existing
used in nonroad equipment when the treatment process and locomotives. However, the manufacturer
logistical constraints or market characteristics of the crude. We expect provided no evidence to show that such
influences in the fuel distribution that hydrotreating will be the damage would likely occur.
system limit the availability of high predominant process used to reduce the Locomotives already use a significant
sulfur fuel. Thus, for nearly a decade sulfur content of NRLM diesel fuel to amount of low sulfur fuel, especially in
nonroad equipment has been using meet the 500 ppm sulfur standard California, and we have not seen any
federal 500 ppm sulfur diesel fuel and during the first step of the program. evidence of sulfur-related problems. The
California diesel fuel, some of which Similarly, we project that both railroads expressed a similar concern,
may have been treated with lubricity conventional hydrotreating and the but acknowledged that any potential
additives. During this time, there has Linde Isotherming process will be used problems would be manageable with
been no indication that the level of to meet the 15 ppm sulfur standard for sufficient lead time. At this time, we see
diesel lubricity needed for fuel used in NRLM diesel fuel. no reason for any special concern
nonroad engines differs substantially Based on our comparison of the related to locomotives using low sulfur
from the level needed for fuel used in blendstocks and processes used to fuel.
highway diesel engines. manufacture non-highway diesel fuels,
Blending small amounts of lubricity- we believe that the potential decrease in 2. A Voluntary Approach on Lubricity
enhancing additives increases the the lubricity of these fuels from In the United States, there is no
lubricity of poor-lubricity fuels to hydrotreating that might result from the government or industry standard for
acceptable levels. These additives are sulfur standards should be diesel fuel lubricity. Therefore,
available in today’s market, are approximately the same as that specifications for lubricity are
effective, and are in widespread use experienced in desulfurizing highway determined by the market. Since the
around the world. Among the available diesel fuel.143 To provide a beginning of the 500 ppm sulfur
additives, biodiesel has been suggested conservative, high cost estimate, we highway diesel program in 1993,
as one potential means for increasing assumed that the potential impact on refiners, engine manufacturers, engine
141 Chevron Products Diesel Fuel Technical
fuel lubricity from the use of the new component manufacturers, and the
Review provides a discussion of the impacts on fuel
desulfurization processes would be the military have been working with ASTM
lubricity of current diesel fuel compositional same as that experienced when
requirements in California versus the rest of the hydrotreating diesel fuel to meet a 15 144 Nonroad and highway diesel engines meeting
nation; see http://www.chevron.com/prodserv/ ppm sulfur standard. Given that the similar emissions standards use similar fuel
fuels/bulletin/diesel/l2%5F7%5F2%5Frf.htm. systems provided by common suppliers. For
142 The cost from the increased use of lubricity requirements for fuel lubricity in example, a nonroad engine meeting the 2001 Tier
additives in 500 ppm NRLM diesel fuel in 2007 and 2 nonroad diesel engine emission standards would
in 15 ppm nonroad diesel fuel in 2010 and 143 See chapter 5 of the RIA for a discussion of have the same fuel system as a highway diesel
locomotive and marine diesel fuel in 2012 is the potential impacts on fuel lubricity of this engine meeting the 1998 highway diesel engine
discussed in section VI of this preamble. proposal. emissions standards.
to develop protocols and standards for diesel fuel specifications, and benefits lead many pipelines to discontinue
diesel fuel lubricity in its D 975 from the considerable experience gained carrying high sulfur heating oil as a
specifications for diesel fuel. ASTM is since 1993. It would also include any separate grade. In areas served by these
working towards a single lubricity new specifications and test procedures pipelines, heating oil users will likely
specification that is applicable to all that we expect would be adopted by switch to 500 ppm sulfur diesel fuel.
diesel fuel used in any type of engine. ASTM regarding lubricity of NRLM This will reduce emissions of SO2 and
Although ASTM has not yet adopted diesel fuel quality. sulfate PM from furnaces and boilers
specific protocols and standards, In any event, this is an issue that will fueled with heating oil. The primary
refiners that supply the U.S. market be resolved to meet the demands of the exception to this will likely be the
have been treating diesel fuel with highway diesel market, and whatever Northeast, where a distinct higher sulfur
lubricity additives on a batch by batch resolution is reached for highway diesel heating oil will still be distributed as a
basis, when poor lubricity fuel is fuel could be applied to NRLM diesel separate fuel. Also, we expect that a
produced. ASTM’s target fuel with sufficient advance notice. We small volume of moderate sulfur
implementation date for this are continuing to participate in the distillate fuel will be created during
specification is January 1, 2005. ASTM Diesel Fuel Lubricity Task distribution from the mixing of low
The potential need for lubricity Force 145 and will assist their efforts to sulfur diesel fuels and higher sulfur
additives in diesel fuel meeting a 15 finalize a lubricity standard. We are fuels, such as jet fuel in the pipeline
ppm sulfur specification was evaluated hopeful that ASTM can reach a interface. Such moderate sulfur
during the development of EPA’s consensus this summer at the next distillate will often be sold by the
highway diesel rule. In response to the meeting of the ASTM’s Lubricity Task terminal as high sulfur heating oil, but
proposed highway diesel rule, all Force. If for some reason ASTM does in fact its sulfur level will be lower than
comments submitted regarding lubricity not take action to set a lubricity that normally sold as heating oil.
either stated or implied that the specification, EPA will consider taking
proposed sulfur standard of 15 ppm appropriate action to ensure 15 ppm H. Refinery Air Permitting
would likely cause the refined fuel to sulfur diesel fuel has adequate lubricity. Prior to beginning diesel
have lubricity characteristics that would desulfurization projects, some refineries
3. What Other Impact Would Today’s
be inadequate to protect fuel injection may be required to obtain a
Actions Have on the Performance of
equipment, and that mitigation preconstruction permit, under the New
Diesel and Other Fuels?
measures such as lubricity additives Source Review (NSR) program, from the
would be necessary. However, the We do not expect that the fuel applicable state/local air pollution
commenters suggested varied program finalized today will have any control agency.146 We believe that
approaches for addressing lubricity. For negative impacts on the performance of today’s program provides sufficient lead
example, some suggested that we need diesel engines in the existing fleet time for refiners to obtain any necessary
to establish a lubricity requirement by which would use the fuels regulated NSR permits well in advance of the
regulation while others suggested that today. applicable compliance dates.
the current voluntary, market based While the process of lowering sulfur Given that today’s diesel sulfur
system would be adequate. The levels to 500 ppm does lower program provides roughly three years of
Department of Defense recommended polynuclear aromatic hydrocarbons lead time before the 500 ppm standard
that we encourage the industry (ASTM) (PNAs) and total aromatics in general, it takes effect, we believe refiners will
to adopt lubricity protocols and does not achieve the near-zero levels have time to obtain any necessary
standards before the 2006 previously seen in California. The 15 preconstruction permits. In addition,
implementation date of the 15 ppm ppm sulfur standard will further reduce the experience gained by many
sulfur standard for highway diesel fuel. PNAs, however, in most diesel fuel, refineries to obtain the preconstruction
The final highway diesel rule did not there will still be PNAs present. permits needed to comply with the Tier
establish a lubricity standard for Furthermore, since the 1990’s, diesel 2 and highway diesel fuel programs
highway diesel fuel. We believe the engine manufacturers have switched to should benefit them in obtaining the
issues related to the need for diesel alternative materials (such as Viton), necessary permits to comply with
lubricity in fuel used in nonroad diesel which do not experience leakage when today’s new diesel fuel requirements.
engines are substantially the same as PNAs are reduced. We believe that there Nevertheless, we believe it is reasonable
those related to the need for diesel will be no issues with leaking fuel to continue our efforts under the Tier 2
lubricity for highway engines. pump O-rings with the changes in diesel and highway diesel fuel programs, to
Consequently, we expect the same fuel sulfur levels required by this help states in facilitating the issuance of
industry-based voluntary approach to rulemaking. permits under the NRLM diesel fuel
ensuring adequate lubricity in nonroad The moderate reduction in PNAs and sulfur program whenever such
diesel fuels that we recognized for total aromatics associated with the assistance may be needed and
highway diesel fuel. We believe the best hydrotreating of diesel fuel will tend to requested. We anticipate that such
approach is to allow the market to increase the cetane index and number of assistance may include both technical
address the lubricity issue in the most diesel fuel. This will improve the
economical manner, while avoiding an driveability of vehicles operating on this 146 Hydrotreating diesel fuel involves the use of
additional regulatory scheme. A higher cetane diesel fuel. process heaters, which have the potential to emit
voluntary approach should provide We do not expect any negative pollutants associated with combustion, such as
adequate customer protection from impacts on other fuels, such as jet fuel NOX, PM, CO and SO2. In addition, reconfiguring
refinery processes to add desulfurization equipment
engine failures due to low lubricity, or heating oil. We do expect that the could increase fugitive VOC emissions. The
while providing the maximum sulfur levels of heating oil may decrease emissions increases associated with diesel
flexibility for the industry. This because of this rulemaking. Beginning desulfurization would vary widely from refinery to
approach would be a continuation of in mid-2007, we expect that controlling refinery, depending on many source-specific
factors, such as crude oil supply, refinery
current industry practices for diesel fuel NRLM diesel fuel to 500 ppm sulfur will configuration, type of desulfurization technology,
produced to meet the current federal amount of diesel fuel produced, and type of fuel
and California 500 ppm sulfur highway 145 ASTM sub committee D02.E0. used to fire the process heaters.
and procedural assistance as would be A. Special Fuel Provisions and vehicles, engines, or equipment with a
provided by the appropriate EPA Exemptions national security exemption. Use of JP–
Regional and Headquarters offices. As discussed in section IV.A.1 above, 5, JP–8, F76, or any other fuel not
Finally, to facilitate the processing of the sulfur standards in today’s rule meeting NRLM diesel fuel standards in
permits, we encourage refineries to generally cover all the diesel fuel that is a motor vehicle or NRLM diesel engine
begin discussions with permitting intended for use in or used in nonroad, or equipment other than the those
agencies and to submit permit locomotive, and marine (NRLM) described above is prohibited under
applications as early as possible. applications that is not already covered today’s rule.
EPA and the Department of Defense
V. Nonroad, Locomotive and Marine by the standards for highway diesel fuel.
have developed a process to address the
Diesel Fuel Program: Details of the For the purposes of this preamble, this
tactical vehicles, engines, and
Compliance and Enforcement fuel is defined primarily by the type of
equipment covered by the diesel fuel
Provisions engine which it is used to power: Land-
exemption and are discussing whether
based nonroad, locomotive, and marine changes to it might be appropriate.
As with earlier fuel programs, we
diesel engines. Section IV.A.1 above Based on data provided by the
have developed a comprehensive set of
also describes several types of Department of Defense to date in the
compliance and enforcement provisions
petroleum distillate that are not covered context of implementing a similar
designed to promote effective and
by the sulfur standards promulgated exemption provision in the highway
efficient implementation of this fuel
today, including jet fuel and heating oil, program, EPA believes that providing an
program and thus to achieve the full
provided they are not used in NRLM exemption for military fuel used in
environmental potential of the program.
engines. The following paragraphs tactical nonroad engines and equipment
The compliance provisions under
discuss several provisions and will not have any significant
today’s final rule are designed to ensure
exemptions for NRLM diesel fuel that environmental impact.
that nonroad, locomotive, and marine
will apply in special circumstances. The Department of Defense (DoD)
diesel fuel sulfur content requirements
are met throughout the distribution 1. Fuel Used in Military Applications commented that EPA should reconsider
system, from the refiner or importer its determination that the definition of
NRLM diesel fuel used in military diesel fuel includes JP8 and JP5. DoD
through to the end user, subject to applications is treated in the same
certain provisions applicable during the cited a 1995 letter from EPA which
manner as under the recent highway stated that there was insufficient reason
early transition years. Section IV above diesel rule. Refiners are not required to
describes our program for the reduction to conclude that JP–8 is commonly and
produce these fuels to the NRLM commercially known as diesel fuel
of sulfur in nonroad, locomotive and standards. However, at the same time,
marine (NRLM) diesel fuel including the under the then applicable definition of
their use is limited only to certain motor vehicle diesel fuel. Since the time
standards and basic design of the military applications. NRLM diesel fuel
compliance and enforcement program. of this letter, EPA has become aware of
is defined so that JP–5, JP–8, F76, and a substantial number of cases of the
This section contains additional details any other military fuel that is used or
regarding the compliance and assurance misuse of aviation turbine fuel in
intended for use in NRLM diesel highway engines. The potential for
program. The provisions discussed in engines or equipment is initially subject
this section fall into several broad misuse of JP–8 or similar fuels in NRLM
to all of the requirements applicable to equipment where no national security
categories: NRLM diesel fuel. However, today’s rule exemption exists would remain. To
—Special fuel provisions and also exempts these military fuels from ensure that NRLM equipment is
exemptions; the diesel fuel sulfur content and other
—Additional provisions applicable to properly fueled with low sulfur fuel, the
requirements in certain circumstances. definition of NRLM diesel fuel has been
refiners and importers; First, these fuels are exempt if they are
—Additional provisions applicable to written to encompass all diesel or other
used in tactical military motor vehicles distillate fuels used or intended for use
parties downstream of the refinery or or nonroad engines, or equipment that
importer; in NRLM engines, which would include
have a national security exemption from JP–8 and JP–5. Furthermore, the
—Special provisions regarding
the vehicle or engine emissions provisions in today’s rule allow
additives, kerosene, and the
standards. Due to national security vehicles, engines, and equipment to be
prohibition against the use of motor
considerations, EPA’s existing fueled with military specification fuels
oil in fuel;
—Fuel testing and sampling regulations allow the military to request that are exempt from the sulfur
requirements; and receive national security standards when needed for national
—Records required to be kept, including exemptions (NSE) for their motor security. We believe that this provides
those applying under the designate vehicles and NRLM diesel engines and DoD with the needed flexibility to meet
and track, credit provisions, small equipment from emissions regulations if its goals of keeping vehicles, engines,
refiner, and refiner hardship the operational requirements for such and equipment ready for quick
provisions; vehicles, engines, or equipment warrant deployment overseas.
—Reporting requirements; such an exemption. This final rule does
not change these provisions. Fuel used 2. Fuel Used in Research, Development,
—Exemptions from the program;
—Provisions concerning liability, in these applications is exempt. Second, and Testing
defenses, and penalties for these fuels are also exempt if they are Today’s final rule permits parties to
noncompliance; and used in tactical military vehicles, request an exemption from the sulfur or
—The selection of the marker for engines, or equipment that are not other standards for NRLM diesel fuel
heating oil and 500 ppm sulfur LM covered by a national security used for research, development and
diesel fuel. (The specific requirements exemption but, for national security testing purposes (‘‘R & D exemption’’).
with respect to heating oil and 500 reasons (such as the need to be ready for We recognize that there may be
ppm sulfur LM diesel fuel inside and immediate deployment overseas), these legitimate research programs that
outside of the Northeast/Mid-Atlantic vehicles, engines, and equipment need require the use of diesel fuel with higher
Area are discussed in section IV.D.) to be fueled on the same fuel as sulfur levels than allowed under today’s
rule. As a result, this final rule contains nonroad diesel fuel requirements for addition, both the seller and purchaser
provisions for obtaining an exemption fuel used in racing vehicles or of invalid credits must adjust their
from the prohibitions for persons, equipment. credit calculations to reflect the proper
producing, distributing, transporting, credits and either party (or both) can be
4. Fuel for Export
storing, selling, or dispensing NRLM deemed in violation if the adjusted
diesel fuel that exceeds the standards, Fuel produced for export, and that is calculations demonstrated
where such diesel fuel is necessary to actually exported for use in a foreign noncompliance. We expect that the
conduct a research, development, or country, is exempt from the fuel content parties to such a credit transaction will
testing program. standards and other requirements of this develop contractual provisions to
Parties seeking an R & D exemption final rule. Such fuel will be considered address these circumstances.
must submit an application for as intended for use in the U.S. and Nevertheless, in a situation where
exemption to EPA that describes the subject to the standards in today’s rule invalid credits are transferred, our
purpose and scope of the program, and unless it is designated by the refiner as strong preference will be to hold the
the reasons why higher-sulfur diesel for export only and PTDs state that the credit seller liable for the violation,
fuel is necessary. Upon presentation of fuel is for export only. Fuel intended for rather than the credit purchaser. As a
the required information, an exemption export must be segregated from all fuel general matter we expect to enforce a
can be granted at the discretion of the intended for use in the U.S., and shortfall in credit compliance
Administrator, with the condition that distributing or dispensing such fuel for calculations against the credit seller,
EPA can withdraw the exemption in the domestic use is illegal. and we expect to enforce a compliance
event the Agency determines the B. Additional Requirements for Refiners shortfall (caused by the good faith
exemption is not justified. In addition, and Importers purchase of invalid credits) against a
an exemption based on false or good faith purchaser only in cases
inaccurate information will be The primary requirements for refiners where we are unable to recover
considered void ab initio. Fuel subject and importers under today’s final rule sufficient valid credits from the seller to
to an exemption is exempt from certain are discussed in section IV above. In cover the shortfall. Moreover, in
provisions of this rule, including the that section, we discuss the general settlement of such cases we will
sulfur standards, provided certain structure of the compliance and strongly encourage the seller to
requirements are met. These enforcement provisions applicable to purchase credits to cover the good faith
requirements include the segregation of refiners and importers, including fuel purchaser’s credit shortfall. EPA will
the exempt fuel from non-exempt NRLM content standards, fuel volume consider the covering of a credit deficit
and highway diesel fuel, identification designation and tracking provisions, through the purchase of valid credits a
of the exempt fuel on PTDs, pump and credit provisions. In this very important factor in mitigation of
labeling, and where appropriate, the subsection, we discuss several any case against a good faith purchaser,
replacement, repair, or removal from additional requirements for refiners and whether the purchase of valid credits is
service of emission systems damaged by importers that are not addressed in made by the seller or by the purchaser.
the use of the high sulfur fuel. section IV. In addition, sections V.G,
V.H, and V.I below discuss several 2. Additional Provisions for Importers
3. Fuel Used in Racing Equipment provisions that apply to all parties in and Foreign Refiners Subject to the
There are no provisions for an the diesel fuel production and Credit Provisions or Hardship
exemption from the sulfur or other distribution system, including refiners Provisions
content standard and other and importers. Since this final rule includes several
requirements for diesel fuel used in compliance options that can be used by
1. Transfer of Credits
racing in today’s final rule. Under NRLM diesel fuel importers and foreign
certain conditions, racing vehicles are This final rule includes provisions for refiners, we are also finalizing specific
not considered nonroad vehicles. See, NRLM diesel sulfur credit transfers that compliance and enforcement provisions
for example, 40 CFR § 89.2, definition of are essentially identical to other fuels to ensure compliance for imported
‘‘nonroad vehicle.’’ The fuel used by rules that have credits provisions. As in NRLM diesel fuel. These additional
such racing vehicles would not other fuels rules, NRLM diesel sulfur foreign refiner provisions are similar to
necessarily be considered nonroad credits can only be transferred between those under the gasoline anti-dumping
diesel fuel. However, we believe that the refiner or importer generating the regulations, the gasoline sulfur
there is a realistic chance that such fuel credits and the refiner or importer using regulations and the highway diesel fuel
also could be used in NRLM equipment, the credits. If a credit purchaser can not regulations (see 40 CFR 80.94, 80.410,
and therefore, should be considered use all the credits it purchased from the and 80.620).
NRLM diesel fuel. We received no refiner who generated them, the credits Under today’s final rule, the per
comments supporting the need for an can be transferred one additional time. gallon standards for NRLM diesel fuel
exemption for racing fuel. We are not We recognize that there is potential for produced by refineries owned by foreign
aware of any advantage for racing credits to be generated by one party and refiners must be met by the importer,
vehicles or racing equipment to use fuel subsequently purchased and used in unless the foreign refiner has been
having higher sulfur levels than are good faith by another party, where the approved to produce NRLM diesel fuel
required by this rule, and we are credits are later found to have been under the credit provisions, small
concerned about the potential for calculated or created improperly, or refiner provisions or hardship
misfueling of nonroad equipment and otherwise found to be invalid. As with provisions of this final rule. If the
motor vehicles that could result from the reformulated gasoline rule, the Tier foreign refiner is approved under any of
having a high sulfur (e.g., 3,000 ppm) 2/Gasoline Sulfur rule, and the highway these provisions, the volume and other
fuel for vehicle or nonroad equipment diesel sulfur rule, invalid credits requirements must be met by the foreign
available in the marketplace. purchased in good faith are not valid for refiner for its refinery(s) and the foreign
Consequently, as was the case with the use by the purchaser. To allow such use refiner must be the entity(s) generating,
highway diesel rule, this final rule does would not be consistent with the using, banking or trading any credits for
not provide an exemption from the environmental goals of the regulation. In the NRLM diesel fuel produced for and
imported into the U.S. Importers for application to 15 ppm sulfur ensure that the sulfur level of fuels
themselves are not eligible for small highway diesel fuel. supplied to the various end-users
refiner or hardship relief as they do not Where diesel fuel that has been covered by today’s rule complies with
face the same capital cost and lead-time previously designated by a refiner is the requirements in today’s rule. At
issues faced by refiners. Importers may used to reduce the sulfur level of the certain points in the distribution
participate in the credit programs, DTAB to 15 ppm or less, the party, in system, such parties must keep the
however, an importer and a foreign its refiner capacity, is required to report various grades of fuel having different
refiner may not generate credits for the only the volume of the imported DTAB sulfur specifications physically
same fuel. as the amount of diesel fuel separate,150 and ensure that the fuel is
Any foreign refiner that produces produced.147 This avoids the double properly designated and labeled. In
NRLM diesel fuel subject to the credit counting that would result if the same other words, fuel represented as 15 ppm
provisions, small refiner provisions or diesel fuel is reported twice (i.e., once sulfur must comply with the 15 ppm
the hardship provisions will be subject by the refiner who originally produced sulfur standard, and fuel represented as
to the same requirements as domestic it and again by the refiner using it to 500 ppm sulfur must meet the 500 ppm
refiners operating under the same blend with DTAB). If the product that is sulfur standard. At other points in the
provisions. Additionally, provisions for blended with the DTAB is not distribution system, certain fuels may be
foreign refiners exist that are similar to previously designated diesel fuel, but is commingled provided that the fuel
the provisions at 40 CFR 80.94, 80.410, also blendstock, the total combined volumes are appropriately designated
and 80.620, which include: volume of the DTAB and other and accounted for in the custody
—Segregation of NRLM diesel fuel blendstock constitutes the batch holders volume account balance.
produced at the foreign refinery until produced. Owners and operators of NRLM diesel
it reaches the U.S. and separate When an importer classifies diesel equipment must also use fuels meeting
tracking of volumes imported into fuel as DTAB, that DTAB does not count specific sulfur content standards. The
each PADD; toward the importer’s calculations following paragraphs discuss several
—Controls on product designation; under the highway diesel rule’s provisions that apply to these parties:
—Load port and port of entry testing; temporary compliance option, toward Distribution of various fuel sulfur
and credit generation or use, or for volume grades; diesel fuel pump labeling; use of
—Requirements regarding bonds and account balance compliance used motor oil in diesel fuel; use of
sovereign immunity. calculations (see section IV).148 The kerosene in diesel fuel; use of additives
same party, however, must include the in diesel fuel; requirements for end
These provisions will aid the Agency users; and provisions covering
DTAB in such calculations in its
in tracking NRLM diesel fuel from the downgrading of undyed diesel fuel to
capacity as a refiner. We believe such an
foreign refinery to its point of import different grades of fuel. These
approach will increase the supply of 15
into this country. We believe these provisions are analogous to similar
ppm sulfur fuel by reducing the volume
provisions are necessary and sufficient provisions that apply to highway diesel
of near-compliant fuel that is
to ensure that foreign refiners’ fuel under the highway program.
downgraded to higher sulfur
compliance can be monitored and that Section IV discusses in detail the
designations. In essence, it allows
the diesel fuel requirements in today’s provisions applicable to downstream
importers the same flexibility that
rule can be enforced against foreign parties under the designate and track
refiners have within their refinery gate.
refiners. Similar to the provisions discussed program.
3. Diesel Fuel Treated as Blendstock above regarding the manufacture of 15 1. Product Segregation and End Use
(DTAB) ppm sulfur diesel fuel using DTAB, 500 Requirements
ppm sulfur NRLM and highway diesel
Under today’s program, a situation The main requirements for
fuel can also be manufactured using
could arise for importers where fuel that compliance with the fuel sulfur
DTAB provided that this is
was expected to comply with the 15 standards under today’s rule, including
appropriately reflected in the importer’s
ppm sulfur NRLM standard is found to the designate and track provisions, are
compliance calculations.
be slightly higher in sulfur than the discussed in section IV of today’s
standard. Rather than require that C. Requirements for Parties Downstream preamble. The sulfur content of all fuels
importer to account for, and report, that of the Refinery or Import Facility subject to the sulfur requirements in
fuel as 500 ppm sulfur fuel, an importer In order for the environmental today’s rule must be appropriately
will be able to designate the non- benefits of the NRLM diesel program to
complying fuel as blendstock—‘‘diesel be realized, parties in the fuel retail outlet is not limited to stationary facilities.
fuel treated as blendstock’’ or DTAB— distribution system downstream of the EPA proposed specific textual changes to the
rather than as NRLM diesel fuel. In its definition of retail outlet to clarify this, but has
refinery (including pipelines, terminals, decided there is no need to change the definition,
capacity as a refiner, the party can then bulk plants, wholesale purchaser- as it has always had this plain meaning. The owner/
blend this DTAB fuel with lower sulfur consumers, and retailers 149) must operator of such a tanker truck may also be subject
diesel fuel or with other blendstocks to to distributor requirements and prohibitions, or
carrier responsibilities if the trucker company does
cause the sulfur level of the combined 147 Volumes of previously designated diesel fuel
not take title to the fuel. As the definitions in 40
product to meet the 15 ppm sulfur would be reported as volumes received under the CFR 80.2 make clear, it is the functions performed
NRLM diesel fuel standard prior to designate and track provisions of Section IV.D. by the owner/operator that determine whether they
148 Importer/refiners availing themselves of the
delivery to another entity. The same come within the scope of the applicable definitions,
DTAB provisions are still subject to the and the resulting obligations or requirements that
situation exists with respect to downgrading provisions, and other provisions apply. Mobile refuelers are not subject to the
compliance with the 15 ppm sulfur applicable to any importer or refiner. labeling requirements applicable to other retailers
highway standard. However, no 149 An owner/operator of a tanker truck that but are required to provide PTDs to their customers.
provision was made in the 2007 delivers fuel directly from the tanker truck tank into 150 For example: Once the required marker is
motor vehicles or nonroad equipment of another added to heating oil at the terminal, heating oil
highway final rule for this. business entity (i.e. a mobile refueler) would be must be segregated from all other fuel grades. Once
Consequently, we are also finalizing acting as a retailer, and the truck would be red dye is added to NRLM it must be segregated
these DTAB provisions in this final rule operating as a retail outlet. In other words, the term from highway diesel fuel.
represented (designated/classified/ the 15 ppm sulfur standard or the 500 it maintains its designation, or it must
labeled) at all times through to the ppm sulfur standard, as applicable, and be redesignated and labeled to its
retailer or wholesale purchaser if so identified must meet such downgraded specification.154
consumer. Furthermore, the designation standard. Distributors and retailers must Because of the sulfur sensitivity of the
and classification information on the avoid contaminating fuel represented by expected engine emission control
label and PTD, and the actual sulfur them on PTDs or pump labels as 15 ppm systems beginning in model year 2011
content of any subject fuel must be sulfur fuel or 500 ppm sulfur fuel with for nonroad diesel engines, it is
consistent with the requirements higher sulfur fuels. End users are imperative that the distribution system
detailed in section IV. Section IV also required to use only the fuel grades segregate nonroad diesel fuel subject to
details how to accurately redesignate, identified as appropriate for use on the the 15 ppm sulfur standard from higher
reclassify, and re-label fuel volumes. label affixed to their NRLM equipment. sulfur distillate products, such as 500
This subsection discusses the various ppm sulfur LM fuel, 500 ppm sulfur
b. The Period From June 1, 2010
grades and uses of NRLM fuel under the nonroad diesel fuel produced by small
Through May 31, 2012
NRLM diesel program. In later refiners or through the use of credits,
subsections, we discuss related Beginning June 1, 2010, all fuel used heating oil, and jet fuel. End users are
requirements for PTDs to identify fuels in nonroad equipment must meet a 15 required to use only the fuel grades
throughout the distribution system and ppm sulfur standard except for 500 ppm identified as appropriate for use on the
provisions relating to the liability that sulfur fuel produced or imported under label affixed to their NR and LM
all parties in the distribution face for the hardship, small refiner, and credit equipment.
failing to maintain the standards of provisions, or downstream flexibility We are also concerned about potential
these different fuel sulfur grades. provisions which may continue to be misfueling of engines requiring 15 ppm
used in nonroad engines produced prior sulfur fuel at retail or wholesale
a. The Period From June 1, 2007 to 2011. Locomotive and marine fuel
Through May 31, 2010 purchaser-consumer facilities (as
will continue to be subject to the sulfur defined under this program), or other
From June 1, 2007 through May 31, requirements applicable beginning June end-user facilities, even when
2010, all fuel used in NRLM equipment 1, 2007, until May 31, 2012. segregation of 15 ppm sulfur fuel from
must meet a 500 ppm sulfur standard During this time period, we will not the higher-sulfur grades of diesel fuel
except for fuel produced or imported be able to rely upon the measurement of has been maintained in the distribution
under the hardship, small refiner, and sulfur content alone to enforce the system. Thus, downstream compliance
credit provisions.151 Outside of the segregation requirements for LM fuel and enforcement provisions of this rule
Northeast/Mid-Atlantic Area and and NR 500 ppm sulfur fuel outside of are aimed at both preventing
Alaska, we will not be able to rely upon the Northeast/Mid-Atlantic Area and contamination of nonroad diesel fuel
the measurement of sulfur content alone Alaska, and are therefore requiring that subject to the 15 ppm sulfur standard
to enforce the segregation requirements LM fuel produced or imported for use (i.e., fuel represented to meet that
for heating oil, and are therefore outside of the Northeast/Mid-Atlantic standard) and preventing misfueling of
requiring that heating oil be marked Area and Alaska be marked before it new nonroad equipment.
before it leaves the terminal by the leaves the terminal by the addition of 6
addition of 6 mg/L of SY–124. Fuel mg/L of SY–124. Fuel containing more c. The Period From June 1, 2012
containing more than 0.1 mg/L of the than 0.1 mg/L of the marker will be Through May 31, 2014
marker will be deemed to be heating oil deemed to be either LM fuel or heating Beginning June 1, 2012, all fuel used
and may not be used as nonroad, oil and may not be used as nonroad fuel. in locomotive and marine equipment
locomotive or marine fuel. Fuel containing the marker that meets a must meet a 15 ppm sulfur standard
NRLM fuel designated or labeled as 500 ppm sulfur standard will be deemed except for 500 ppm sulfur fuel produced
500 ppm sulfur must meet the 500 ppm to be LM fuel, whereas fuel containing or imported under the hardship, small
sulfur standard and any fuel designated the marker with a sulfur content above refiner, and credit provisions, or
or labeled as 15 ppm must meet the 15 500 ppm will be deemed to be heating downstream flexibility provisions. As
ppm sulfur standard.152 If a fuel meeting oil. discussed in section IV above, small
these standards is mixed or As discussed in section IV above, refiners will be able to continue to
contaminated with a higher sulfur fuel small refiners will be able to continue produce 500 ppm sulfur LM fuel,
it must be downgraded to the higher to produce 500 ppm sulfur nonroad through May 31, 2014. Other refiners
sulfur product and new documentation fuel, through May 31, 2014. Other may use credits through May 31, 2014
(e.g., PTD, label) must be created to refiners may use credits through May to continue to produce fuel to the 500
reflect the downgrade. During this 31, 2014 to continue to produce fuel to ppm sulfur LM diesel fuel standard.
period there will also be nonroad the 500 ppm sulfur nonroad diesel fuel Locomotive, and marine diesel fuel
equipment that is expected to be standard. Nonroad diesel fuel meeting a meeting a 500 ppm sulfur standard may
equipped with sulfur sensitive 500 ppm sulfur standard may also be also be produced due to interface
emissions control technology that needs produced due to interface mixing in the mixing in the distribution system
to operate on 500 ppm sulfur or less fuel distribution system.153 In any case, 15 indefinitely.
in order to meet the NRLM program’s ppm sulfur diesel fuel must be The marker requirement for 500 ppm
emission standards in-use. Fuels sold segregated from 500 ppm sulfur NRLM sulfur LM diesel fuel expires on June 1,
for use in, or dispensed into, these diesel fuel throughout the distribution 2012. After June 1, 2012, only heating
engines must be identified as meeting system including the end user, such that oil must continue to be marked and any
LM diesel fuel distributed from the
151 Fuel produced in the distribution system that 153 Such 500 ppm sulfur downstream flexibility
meets a 500 ppm sulfur specification may be used
terminal must not contain the marker.
nonroad diesel fuel may be also be used in LM
in NRLM equipment through June 1, 2014, and in equipment since it complies with the LM sulfur To allow marked LM diesel fuel
locomotive and marine equipment thereafter. standard applicable during this time period. Thus,
152 This requirement becomes effective June 1, both marked and unmarked 500 ppm sulfur fuel 154 These flexibilities do not exist in the
2006 to support the anti-downgrade requirements in may be used in LM equipment during this time Northeast/Mid-Atlantic Area, and only the small
the highway diesel rule. period. refiner option exists in Alaska.
distributed prior to June 1, 2012 to be and properly fuel their nonroad non-highway labeling requirement
consumed by end-users, the equipment. Section III.N above effective June 1, 2006 under the
downstream prohibition against LM fuel describes the labels that manufacturers highway diesel rule from the non-
containing the marker will not become are required to place on nonroad highway labeling requirements of this
effective until October 1, 2012. equipment, and the information that rule that are effective in 2007.
Beginning October 1, 2012, LM diesel must be provided to nonroad equipment Alternate labels to those specified in
fuel at any location must contain no owners. Section VI discusses the likely today’s rule may be used if they are
more than 0.1 mg/L of the marker.155 benefit for many nonroad engines to approved by the Administrator.
We believe that allowing four months utilize 500 ppm sulfur diesel fuel as Today’s rule also finalizes labeling
for downstream parties to blend down soon as it becomes available in 2007. requirements for pumps in Alaska that
their stocks of marked LM diesel fuel Today’s final rule includes requirements dispense NRLM diesel fuel and heating
with receipts of unmarked LM diesel for labeling fuel pump stands used to oil which is exempt from the red dye
fuel will be sufficient for such parties to fuel NRLM equipment and highway and fuel marker requirements which
comply with the prohibition against diesel vehicles. differ from the labeling requirements
possessing LM fuel with a marker To help prevent misfueling of discussed in this section. Please refer to
concentration greater than 0.1 mg/L. nonroad, locomotive and marine § 69.52(e) of the regulatory text to
The requirements that became engines, and to thus ensure that the today’s rule for these pump labeling
effective for fuel used in nonroad environmental benefits of the program requirements applicable in Alaska.
equipment on June 1, 2010, will remain are realized, we are finalizing pump
effective until May 31, 2014. labeling requirements similar to those a. Pump Labeling Requirements that
adopted in the highway diesel rule (40 Become Effective June 1, 2006
d. After May 31, 2014
CFR 80.570). Today’s pump dispenser The pump labeling requirements
After the small refiner, credit, and off- labeling requirements are discussed described in this section become
specification fuel flexibilites have separately according to the date they effective June 1, 2006.
expired, the remaining sulfur grades of become effective: June 1, 2006, June 1,
diesel fuel will be 15 ppm sulfur 2007, June 1, 2010, and June 1, 2014. i. Pumps Dispensing Highway Diesel
highway and NRLM fuel, 500 ppm Today’s final rule also amends the Fuel Subject to the 15 ppm Sulfur
sulfur LM diesel fuel (produced due to pump dispenser labeling language in the Standard
interface mixing in the distribution highway diesel regulations for The label on pumps dispensing
system outside of the Northeast/Mid- consistency with the NRLM program. highway diesel fuel subject to the 15
Atlantic Area and Alaska), and heating Because existing highway diesel ppm sulfur standard must read as
oil, some of which may meet a 500 ppm regulations prohibit highway diesel fuel follows:
sulfur standard. Product transfer with sulfur levels above 500 ppm, the
documents are required to accompany ULTRA LOW-SULFUR HIGHWAY DIESEL
highway diesel final rule and this
the batches of such fuels which must FUEL (15 ppm Sulfur Maximum)
program have different meanings for the
contain the specified identifying terms ‘‘low sulfur’’ and ‘‘high sulfur,’’ Required for use in all model year 2007
information. Highway and NRLM diesel and later highway diesel vehicles and
and the highway diesel final rule does
fuel meeting a 15 ppm sulfur engines.
not use the term ‘‘ultra low-sulfur.’’ Recommended for use in all diesel vehicles
specification must be segregated from Further, because the highway diesel and engines.
500 ppm sulfur LM diesel fuel, and final rule did not need to categorize the
heating oil. Today’s rule contains different uses of non-highway diesel The above labeling requirement for 15
provisions for the fungible shipment of fuel, the highway diesel final rule and ppm sulfur highway diesel fuel
LM diesel fuel with any heating oil this program have different meanings continues through May 31, 2010, after
meeting a 500 ppm sulfur cap up to the for the term ‘‘nonroad.’’ 156 The which time different pump label
point where the fuel leaves the terminal amendments to the highway pump requirements for this fuel become
that are similar to the provisions that dispenser labeling language finalized by effective as described in section
allow the fungible shipment of high today’s rule are meant to avoid V.C.2.c.3. of this preamble.
sulfur NRLM diesel fuel and high sulfur confusion at the fuel pumps caused by ii. Pumps Dispensing Highway Diesel
heating oil discussed in the previous labels that would have different Fuel Subject to the 500 ppm Sulfur
section. Under such circumstances the meanings depending on whether the Standard
designate and track and heating oil pump is dispensing highway or non-
account balance requirements must be highway diesel fuel. Today’s final rule The label on pumps dispensing
satisfied. adds effective dates to each paragraph of highway diesel fuel subject to the 500
the labeling provisions of the highway ppm sulfur standard must read as
2. Diesel Fuel Pump Labeling To follows:
Discourage Misfueling diesel rule for consistency with the
additional pump labeling sections of LOW-SULFUR HIGHWAY DIESEL FUEL
For any multiple-fuel program like the this program, and to distinguish the (500 ppm Sulfur Maximum)
two-step program we are finalizing
today, we believe that the clear labeling WARNING
156 In the highway diesel rule, the term ‘‘high-
of nonroad diesel fuel pumps is vital so sulfur’’ means diesel fuel with a sulfur level greater Federal law prohibits use in model year
that end users can readily distinguish than 15 ppm, whereas in this rule it means diesel 2007 and later highway vehicles and engines.
between the several grades of fuel that fuel with a sulfur level greater than 500 ppm. In the Its use may damage these vehicles and
highway diesel rule, the term ‘‘low-sulfur’’ means engines.
may be available at fueling facilities, diesel fuel with a sulfur level less than or equal to
15 ppm, whereas in this rule it means diesel fuel Dispensing highway diesel fuel that
155 Allowing four months for the LM fuel with a sulfur level less than or equal to 500 ppm. has a sulfur content above 15 ppm is
distribution system to sufficiently purge itself of In addition, the term ‘‘nonroad’’ as used in the prohibited into any highway vehicle
marked fuel is consistent with the time allowed for highway diesel rule means ‘‘non-highway’’ (i.e., all
LM diesel fuel to comply with a 500 ppm sulfur fuel that is not highway fuel), but the term
after September 30, 2010. Hence no
standard after the refinery gate 15 ppm sulfur ‘‘nonroad’’ as used in this rule does not include pumps may display the above label after
standard for LM fuel becomes effective. locomotive diesel, marine diesel and heating oil. September 30, 2010.
iii. Pumps Dispensing Diesel Fuel for LOW-SULFUR NON-HIGHWAY DIESEL iv. Pumps Dispensing Heating Oil
Non-Highway Equipment That Does Not FUEL (500 ppm Sulfur Maximum)
As discussed in section IV.B.2.b, it is
Meet the Standards for Motor Vehicle WARNING necessary to segregate heating oil from
Diesel Fuel Federal law prohibits use in any highway NRLM diesel fuel to ensure that the fuel
vehicle or engine used in nonroad, locomotive, and
The label on pumps dispensing diesel
marine equipment is compliant with the
fuel for non-highway equipment that The above labeling requirement sulfur standards in today’s rule. The
does not meet the standards for motor remains effective until May 31, 2010, label on pumps dispensing non-
vehicle diesel fuel must read as follows: after which it is superceded by the highway diesel fuel for use other than
NON-HIGHWAY DIESEL FUEL (May Exceed requirements described below. in nonroad, locomotive or marine
500 ppm Sulfur) ii. Pumps Dispensing NRLM Diesel Fuel engines, such as for use in stationary
WARNING Subject to the 15 ppm Sulfur Standard diesel engines or as heating oil, must
read as follows:
Federal law prohibits use in any highway It is also likely that prior to June 1,
vehicle or engine 2010 some 15 ppm sulfur (maximum) HEATING OIL (May Exceed 500 ppm Sulfur)
Its use may damage these vehicles and diesel fuel will be introduced into the WARNING
engines. nonroad market early. Both the engine Federal law prohibits use in highway
and fuel credit provisions envision such vehicles or engines, or in nonroad,
This labeling requirement is effective early introduction of 2011–compliant locomotive, or marine engines.
until May 31, 2007, after which high engines and 15 ppm sulfur diesel fuel. Its use may damage these diesel engines.
sulfur non-highway diesel fuel must be Thus, it is important that nonroad end
labeled according to the provisions The above labeling will remain
users be able to know when they are effective indefinitely.
described in section V.C.2.b.iii and 500 purchasing diesel fuel with 15 ppm or
ppm sulfur non-highway diesel fuel less sulfur.157 The label on pumps c. Pump Labeling Requirements That
must be labeled according to the dispensing 15 ppm sulfur diesel fuel for Become Effective June 1, 2010
provisions described in section use in NRLM engines must read as Beginning October 1, 2010, all diesel
V.C.2.b.1. of today’s preamble. follows: fuel introduced into highway diesel
b. Pump Labeling Requirements That ULTRA-LOW SULFUR NON-HIGHWAY
vehicles, regardless of the year of
Become Effective June 1, 2007 DIESEL FUEL (15 ppm Sulfur Maximum) manufacture, must meet the 15 ppm
sulfur standard. Furthermore, with
As discussed in section IV, between Required for use in all model year 2011
and newer nonroad diesel engines.
certain exceptions, fuel introduced into
June 1, 2007 and September 30, 2010, Recommended for use in all nonroad, any nonroad engine must meet the 15
end users are not always required to locomotive and marine diesel engines. ppm sulfur standard. The exceptions are
dispense fuel meeting the 500 ppm fuel allowed to meet the 500 ppm sulfur
sulfur standard into nonroad, WARNING standard for use only in pre-model year
equipment, locomotives or marine Federal law prohibits use in any highway 2011 nonroad engines and locomotive
vessels. During this time period, small vehicle or engine. and marine engines, for example, small
refiner fuel and fuel produced under the The above labeling requirement refiner nonroad diesel fuel and credit
credit provisions with sulfur levels continues until May 31, 2014, after nonroad diesel fuel, as well as
exceeding 500 ppm will continue to which it is superceded by the labeling downgraded 15 ppm sulfur diesel fuel
exist in the distribution system. During provisions described in section V.C.2.e.i from the distribution system. This use of
this time period, there will also be of today’s preamble. 500 ppm sulfur diesel fuel in nonroad
nonroad equipment with engines engines will continue through
certified as meeting the Tier 4 emission iii. Pumps Dispensing Diesel Fuel With September 30, 2014,158 after which all
standards (i.e., engines equipped with a Sulfur Content Greater Than 500 ppm nonroad diesel fuel must meet the 15
emission controls that allow them to for Use in Older NRLM Equipment ppm sulfur standard. The following
meet the Tier 4 standards earlier than pump labeling requirements become
The label on pumps dispensing diesel
required). Some of this equipment is effective June 1, 2010:
fuel having a sulfur content greater than
expected to be equipped with sulfur
500 ppm (for use in older nonroad, i. Pumps Dispensing NRLM Diesel Fuel
sensitive technology that will need to
locomotive, and marine diesel engines) Subject to the 500 ppm Sulfur Standard
operate on fuel with a sulfur content of
must read as follows: The label on pumps dispensing 500
500 ppm or less to function properly.
For this reason, it is important that HIGH-SULFUR NON-HIGHWAY DIESEL ppm (maximum) nonroad, locomotive,
NRLM end users be able to know the FUEL (May Exceed 500 ppm Sulfur) and marine diesel fuel, as discussed in
sulfur level of the fuel they are WARNING section IV.B.3.b, must read as follows:
purchasing and dispensing. Therefore, Federal law prohibits use in highway LOW-SULFUR NON-HIGHWAY DIESEL
fuel pump dispensers for the various vehicles or engines FUEL (500 ppm Sulfur Maximum)
sulfur grades must also be properly May damage nonroad, diesel engines WARNING
labeled. The following pump labeling required to use low-sulfur or ultra-low sulfur
requirements become effective from diesel fuel. Federal law prohibits use in all model year
2011 and newer nonroad engines.
June 1, 2007:
The above labeling requirement May damage model year 2011 and newer
i. Pumps Dispensing NRLM Diesel Fuel remains effective until September 30, nonroad engines.
Subject to the 500 ppm Sulfur Standard 2010. After September 30, 2010 no
158 Production of 500 ppm sulfur fuel under the
pump may display this label.
The label on pumps dispensing 500 credit provisions is allowed until June 1, 2012, but
small refiner fuel subject to the 500 ppm sulfur
ppm (maximum) sulfur content diesel 157 The IRS requires that 15 ppm sulfur non- standard can continue to be produced until June 1,
fuel for use in NRLM engines must read highway diesel fuel must contain red dye after it 2014 and will be available to end users until
as follows: leaves the terminal. September 1, 2014.
Federal Law Prohibits Use in any Highway WARNING Although in the highway diesel fuel
Vehicle or Engine. Federal law prohibits use in any highway rule we did not finalize any provisions
Recommended for use in all locomotive vehicle or engine. beyond fuel pump labeling
and marine equipment.
The above labeling requirement requirements, we recognized that some
The above labeling requirement potential for misfueling could still exist.
continues indefinitely.
remains effective until September 30, Consequently, we expressed a desire to
2014. After September 30, 2014, no ii. Pumps Dispensing Locomotive and continue to explore with industry
pump may display this label. Marine Diesel Fuel Subject to the 500 simple, cost-effective approaches that
ii. Pumps Dispensing Marked LM Fuel ppm Sulfur Standard could further minimize misfueling
For pumps dispensing locomotive or potential such as color-coded nozzles/
The label on pumps dispensing 500 scuff guards. Since the highway diesel
ppm sulfur locomotive, and marine marine diesel fuel, the label must read
as follows: rule was promulgated, we have had
diesel fuel, as discussed in section discussions with fuel retailers,
IV.B.3.b., must read as follows: LOW-SULFUR LOCOMOTIVE OR MARINE wholesale purchaser-consumers, vehicle
DIESEL FUEL (500 ppm Sulfur Maximum) manufacturers, and nozzle
LOW-SULFUR LOCOMOTIVE AND
MARINE DIESEL FUEL (500 ppm Sulfur WARNING manufacturers, and continue to examine
Maximum) different methods for preventing
Federal law prohibits use in nonroad
WARNING engines or in highway vehicles or engines. accidental or intentional misfueling
Its use may damage these engines. under the highway diesel fuel sulfur
Federal law prohibits use in nonroad
engines or in highway vehicles or engines. program. To date, the affected
The above labeling requirement will
stakeholders, including engine and
The above labeling requirement remain effective indefinitely. truck manufacturers, truck operators,
remains effective until September 30, f. Nozzle Size Requirements or other fuel retailers, and fuel nozzle
2012. After September 30, 2012, no Requirements To Prevent Misfueling manufacturers have not reached any
pump may display this label. common view that the concerns over
Like the highway diesel fuel program,
iii. Pumps Dispensing Highway Diesel misfueling warrant any additional
the NRLM diesel fuel program does not
Fuel Subject to the 15 ppm Sulfur prevention measures.
include a nozzle size requirement. In
Standard part this is because we are not aware of 3. Prohibition Against the Use of Used
The label on pumps dispensing an effective and practicable scheme to Motor Oil in New Nonroad Diesel
highway diesel fuel subject to the 15 prevent misfueling through the use of Equipment
ppm sulfur standard of § 80.520(a)(1) different nozzle sizes or shapes, and in We understand that used motor oil is
must read as follows: part because we do not believe that sometimes blended with diesel fuel
ULTRA LOW-SULFUR HIGHWAY DIESEL
improper fueling will be a significant today for use as fuel in nonroad diesel
FUEL (15 ppm Sulfur Maximum) enough problem to warrant such an equipment. Such practices include
action. In the preamble to the highway blending used motor oil directly into the
Required for use in all highway diesel
vehicles and engines. diesel fuel rule, we stated our belief that equipment fuel tank, blending it into the
Recommended for use in all diesel vehicles the use of unique nozzles, color-coded fuel storage tanks, and blending small
and engines. scuff-guards, or dyes to distinguish the amounts of motor oil from the engine
The above labeling requirement for 15 grades of diesel fuel may be useful in crank case into the fuel system as the
ppm sulfur highway diesel fuel preventing accidental use of the wrong equipment is operated.
continues indefinitely. fuel. (See 66 FR 5119, January 18, 2001.) However, motor oil normally contains
However, we did not finalize any such high levels of sulfur. Thus, the addition
d. Pump Labeling Requirements That requirements, for the reasons described of used motor oil to nonroad diesel fuel
Become Effective June 1, 2014 in the RIA for that final rule (section could substantially impair the sulfur-
Beginning October 1, 2014, all IV.E). sensitive emissions control equipment
nonroad fuel distributed to end-users is Similar reasoning applies to the expected to be used by engine
required to meet the 15 ppm sulfur NRLM diesel fuel program. For manufacturers to meet the emissions
standard, without exception. example, 15 ppm sulfur diesel fuel will standards in today’s final rule.
Locomotive and marine fuel be the dominant fuel in the market by Depending on how the oil is blended, it
downstream of the refinery or importer 2010, likely comprising more than 80 could increase the sulfur content of the
is still subject to the 500 ppm sulfur percent of all number 2 distillate. fuel by as much as 200 ppm sulfur. As
standard. The pump labels for heating Further, we believe that 500 ppm sulfur a result, we believe blending used motor
oil will continue to be the same as for diesel fuel will have limited availability oil into nonroad diesel fuel could render
the period 2010 through 2014. The between 2010 and 2014. High-sulfur inoperative the expected emission
following pump labeling requirements distillate for heating oil uses will control technology and potentially
become effective beginning June 1, remain, but will only exist in significant cause driveability problems.
2014: volumes in certain parts of the country. Consequently, it would violate the
In addition, as with highway diesel tampering prohibition in the Act. See
i. Pumps Dispensing NRLM Diesel Fuel engines, there is currently no CAA sections 203(a)(3), and 213(d).
Subject to the 15 ppm Sulfur Standard standardization of fuel tank openings Therefore, like the highway diesel
For pumps dispensing nonroad diesel and filler necks that would allow for a rule, today’s rule prohibits any person
fuel the label must read as follows: simple, inexpensive, standardization of from introducing or causing or allowing
ULTRA-LOW SULFUR NON-HIGHWAY nozzles. In any event, we believe that the introduction of used motor oil, or
DIESEL FUEL (15 ppm Sulfur Maximum) most owners and operators of new diesel fuel containing used motor oil,
Required for use in all nonroad diesel nonroad diesel engines and equipment into the fuel delivery systems of
engines. will not risk voiding the general nonroad equipment engines
Recommended for use in all locomotive warranty and the emissions warranty by manufactured in model year 2011 and
and marine diesel engines. misfueling. later. The only exception to this will be
where the engine was explicitly not need to meet the 80/20 requirements No. 1 highway diesel fuel, and will
certified to the emission standard with under the highway diesel program. This simply need to meet all of the
used motor oil added and the oil was activity is treated the same way under requirements of highway diesel fuel. It
added in a manner consistent with the the final highway diesel rule. Parties is also possible, though less likely that
certification. Furthermore, as discussed that blend kerosene into diesel fuel are kerosene meeting the 500 ppm sulfur
in section IV, today’s rule includes subject to the downstream designate and standard will be designated as No. 1
certain sunset dates when all NRLM track provisions applicable to other highway diesel fuel. However, if it is, it
diesel fuel in the distribution system downstream parties. would also merely need to comply with
must meet the applicable sulfur In order to ensure the continued all the requirements applicable to
standard, and before that date any compliance of 15 ppm sulfur fuel with highway diesel fuel.
NRLM designated, classified, or labeled the 15 ppm sulfur standard,
as 15 ppm sulfur fuel must meet that downstream parties choosing to blend 5. Use of Diesel Fuel Additives
sulfur standard. Blending of used motor kerosene into 15 ppm sulfur NRLM Diesel fuel additives include lubricity
oil into NRLM could cause these diesel fuel are required to either have a improvers, corrosion inhibitors, cold-
standards to be exceeded in violation of PTD for that kerosene indicating operability improvers, and static
today’s rule. Any party who causes the compliance with the 15 ppm sulfur dissipaters. Use of such additives is
sulfur content of nonroad diesel fuel standard, or to have test results for the distinguished from the use of kerosene
subject to the 15 ppm sulfur standard to kerosene establishing such compliance. or biodiesel by the low concentrations at
exceed 15 ppm by blending motor oil Further, downstream parties choosing to which they are used (defined to be one
into nonroad diesel fuel, or by using blend kerosene into 15 ppm sulfur percent or less) and their relatively more
motor oil as nonroad diesel fuel, is NRLM diesel fuel are entitled to the two complex chemistry.159 The suitability of
subject to liability for violating the ppm adjustment factor discussed in diesel fuel additives for use in diesel
sulfur standard. Similarly, parties who section V.D.2. for both the kerosene and fuel meeting a 500 ppm sulfur
cause the sulfur level of nonroad diesel the diesel fuel into which it is blended specification has been well established
fuel subject to the 500 ppm sulfur at downstream locations, provided that due to the existence of 500 ppm sulfur
nonroad diesel fuel standard to exceed the kerosene had been transferred to the highway diesel fuel in the marketplace
that standard by blending motor oil into party with a PTD indicating compliance since 1993. The suitability of additives
the fuel, are also subject to liability. with that standard. Sulfur test results for use in 15 ppm sulfur diesel fuel was
from downstream locations of parties first addressed by EPA in the highway
4. Use of Kerosene in Diesel Fuel who do not have such a PTD for their diesel program, which requires highway
As we discussed in the highway kerosene will not be subject to this diesel fuel to meet a 15 ppm sulfur
diesel final rule, kerosene is commonly adjustment factor, either for the standard beginning in 2006. At the time
added to diesel fuel to reduce fuel kerosene itself, or for the NRLM diesel of the finalization of the highway diesel
viscosity in cold weather (see 66 FR fuel into which it is blended. final rule and during our development
5120, January 18, 2001). This final rule Any party who causes the sulfur of the proposed NRLM diesel rule, our
does not limit this practice with regard content of NRLM diesel fuel represented review of data submitted by additive
to 15 ppm sulfur or 500 ppm sulfur as meeting the 15 ppm sulfur standard and fuel manufacturers to comply with
NRLM diesel fuel. However the to exceed 15 ppm sulfur by blending EPA’s Fuel and Fuel Additive
resulting blend will still be subject to kerosene into NRLM diesel fuel, or by Registration requirements indicated that
the 15 ppm sulfur or 500 ppm sulfur using greater than 15 ppm sulfur additives to meet every purpose,
standard. Kerosene that is used, kerosene as NRLM diesel fuel, is subject including static dissipation, are
intended for use, or made available for to liability for violating the sulfur currently in common use which meet a
use as, or for blending with, 15 ppm standard. Similarly, parties who cause 15 ppm cap on sulfur content.160
sulfur or 500 ppm sulfur diesel fuel is the sulfur level of NRLM diesel fuel
itself required to meet the 15 ppm sulfur subject to the 500 ppm sulfur diesel fuel a. Additives Used in 15 ppm Sulfur
or 500 ppm sulfur standard. standard to exceed that standard by Diesel Fuel
As a general matter, any party who blending kerosene into the fuel, are also Similar to the highway diesel rule,
blends kerosene, or any blendstock, into subject to liability. today’s rule allows the bulk addition of
NRLM diesel fuel, or who produces Today’s rule does not require refiners diesel fuel additives with a sulfur
NRLM diesel fuel by mixing or importers of kerosene to produce or content greater than 15 ppm in NRLM
blendstocks, will be treated as a refiner import kerosene meeting the 15 ppm diesel fuel under certain
and will be subject to the requirements sulfur standard. However, we believe circumstances.161 However, NRLM
and prohibitions applicable to refiners that refiners will produce ultra low
under today’s rule. For example, the sulfur kerosene in the same refinery 159 Diesel fuel additives are used at
fuel that they manufacture must meet processes that they use to produce ultra concentrations commonly expressed in parts per
the sulfur standards established in this low sulfur diesel fuel, and that the million. Diesel fuel additives can include specially-
rule, and represented on the PTD. market will drive supply of ultra low formulated polymers and other complex chemical
components. Kerosene is used at much higher
However, in deference to the sulfur kerosene for those areas where, concentrations, expressed in volume percent.
longstanding and widespread practice of and during those seasons when, the Unlike diesel fuel additives, kerosene is a narrow
blending kerosene into diesel fuel at product is needed for blending with distillation fraction of the range of hydrocarbons
downstream locations, downstream NRLM, as well a highway, diesel fuel. normally contained in diesel fuel.
160 See Chapter IV.D. of the RIA for the highway
parties who only blend kerosene into As discussed in section IV.D,
diesel fuel rule for more information on diesel fuel
NRLM and highway diesel fuel will not kerosene blending also factors into the additives, EPA Air docket A–99–06, docket item V–
be subject to the requirements designate and track provisions finalized B–01. Also see 40 CFR part 79.
applicable to other refiners, provided today from June 1, 2006 until June 1, 161 Most diesel fuel additives are added at the
that they do not alter the fuel in any 2010. During this time period it is terminal to bulk fuel volumes before sale to the
consumer. These additives are referred to as bulk
other way, and do not violate the possible, and in fact likely, that additives. End users and wholesale purchaser
volume balance requirements discussed kerosene meeting the 15 ppm sulfur consumers sometimes also add additives to diesel
in section IV.D. For example, they will standard will instead be designated as Continued
diesel fuel containing such additives The specific requirements regarding needed for such additives, their use will
will continue to be subject to the 15 the use of bulk diesel fuel additives in raise the sulfur content of the finished
ppm sulfur cap. We believe that it is NRLM fuel subject to the 15 ppm sulfur fuel by no more than 0.02 ppm.
most appropriate for the market to standard are as follows: Commenters stated that because of the
determine how best to accommodate —Bulk additives that have a sulfur extremely low potential contribution to
increases in fuel sulfur content from the content at or below 15 ppm must be the sulfur level of the finished diesel
refinery gate to the end user, while accompanied by a PTD that states: fuel which might result from the use of
maintaining the 15 ppm sulfur cap, and ‘‘The sulfur content of this additive static dissipater additives, there was
whether such increases result from does not exceed 15 ppm.’’ little risk that use of such additives
contamination in the distribution —Bulk additives that exceed 15 ppm would result in noncompliance with the
system or bulk diesel additive use. By sulfur could continue to be used in 15 ppm sulfur cap.
providing this flexibility, we anticipate diesel fuel subject to the 15 ppm We contacted all of the additive
that market forces will encourage an sulfur standard provided that they are manufactures that have registered static
optimal balance between the competing used at a concentration of less than dissipater additives in EPA’s Fuel and
demands of manufacturing fuel lower one volume percent and their transfer Fuel Additive Database.162 All of these
than the 15 ppm sulfur cap, limiting is accompanied by a PTD that lists the manufactures stated that there are no
contamination in the distribution following: fully-effective static dissipater additives
system, and limiting the bulk additive available that have a sulfur content
(1) A warning that the additive’s
contribution to fuel sulfur content. below 15 ppm. They further stated that
sulfur content may exceed 15 ppm and
Thus, as in the highway diesel sulfur is an essential component in
that improper use of the additive may
program, additive manufacturers that static dissipater additives, and that it is
result in non-complying fuel,
market bulk diesel additives with a currently unclear how to formulate a
(2) The additive’s maximum sulfur
sulfur content higher than 15 ppm and static dissipater additive that would
concentration,
blenders that use them in nonroad have a sulfur content below 15 ppm.
(3) The maximum recommended
diesel have additional requirements to Because of this input, we now recognize
concentration for use of the additive in
ensure that the 15 ppm sulfur cap for that static dissipater additives are in a
diesel fuel, and
NRLM diesel fuel is not exceeded. unique category with respect to the
(4) The contribution to the sulfur level
The 15 ppm sulfur cap on highway ability to comply with a 15 ppm sulfur
of the fuel that would result if the
diesel fuel that becomes effective in cap. Additive manufactures stated that
additive is used at the maximum
2006 may encourage the gradual reformulation of static dissipater
recommended concentration.
retirement of additives that do not meet additives to meet a 15 ppm sulfur cap
We proposed that the affirmative
a 15 ppm sulfur cap. The 15 ppm sulfur will likely be a lengthy undertaking.
defenses to presumptive liability for It is unclear which of the naturally-
cap for NR fuel in 2010 and for LM fuel blenders of bulk additives with a sulfur
in 2012 may further this trend. occurring components in diesel fuel act
content greater than 15 ppm must to dissipate static electricity. However,
However, we do not anticipate that this include periodic sulfur tests after the
will result in disruption to additive certain batches of fuel are periodically
addition of the additive showing that found which do not have adequate static
users and producers or a significant the finished fuel does not exceed the 15
increase in cost. Additive manufacturers dissipating qualities. In such cases,
ppm sulfur cap. We are adopting this static dissipater additives are necessary
commonly reformulate their additives proposed requirement for additives
on a periodic basis as a result of to prevent a static discharge from
other than static dissipater additives. occurring during the transfer of fuel into
competitive pressures. We anticipate
that any reformulation that might need b. Static Dissipater Additives a storage tank which might cause an
to occur to meet a 15 ppm sulfur cap, explosion. Therefore, it is essential that
Comments from diesel fuel
will be accomplished prior to the today’s rule is structured in such a way
distributors and additive manufactures
implementation of the 15 ppm sulfur so as to not impede the use static
stated that static dissipater additives are
cap on highway diesel fuel in 2006. dissipater additives. Because of the lack
unique among the various types of
Like the highway diesel fuel rule, this of static dissipater additives meeting a
diesel fuel additives in that there are
rule will limit the continued use in 15 15 ppm sulfur specification, the unique
currently none available with a sulfur
ppm sulfur fuel of a bulk additive that difficulty in reformulating them to meet
content below 15 ppm which are fully
exceeds 15 ppm sulfur to a a 15 ppm sulfur standard, the fact that
effective. Considering the lack of static
concentration of less than one volume they are essential to the safety of the
dissipater additives meeting a 15 ppm
percent. We believe that this limitation fuel distribution system, and the
sulfur cap, and the inability to add static
is appropriate and will not cause any impracticability for them to be added at
dissipater (S–D) additives prior to
undue burden because the diesel fuel the refinery, today’s rule includes
shipment by pipeline, commenters
additives for which this flexibility was special affirmative defense provisions to
stated that the prohibitive cost of testing
included are always used today at reduce the sulfur testing burden
fuel batches after the addition of static
concentrations well below one volume associated with the use of static
dissipater additives could discourage
percent. Further, one volume percent is dissipater additives that have a sulfur
their use. To avoid the potential adverse
the threshold above which the blender content greater than 15 ppm.
impact on the safety of the fuel
of an additive becomes subject to all the Commenters suggested an alternative
distribution industry which could
requirements applicable to a refiner. See mechanism to demonstrate an
result, commenters requested that we
40 CFR 79.2(d)(1) and 40 CFR part 80. affirmative defense to presumptive
provide an alternative method for use in
liability for blenders of static-dissipater
demonstrating their affirmative defense
(S–D) additives which would avoid the
fuel by hand blending into the vehicle fuel tank or to presumptive liability when they use
fleet fuel storage tanks. Such additives are referred need to test every batch of fuel at the
static dissipater additives with a sulfur
to as aftermarket additives. As discussed at the end
of this section, today’s rule contains different
content above 15 ppm. Manufacturers of 162 All additives must be registered with EPA
requirements regarding the use of aftermarket static dissipater additives stated that Fuel and Fuel Additive Database prior to their use
additives. due to very low treatment rates that are in motor vehicle diesel fuel.
terminal after additization. Under this which shows that the contribution to subject to the 15 ppm sulfur
approach, blenders of S–D additives the sulfur level of the finished diesel specification when used at the
would be required to provide volume fuel from the use of the additive at the maximum recommended treatment level
accounting reconciliation (VAR) records treatment level at which it was are required to conduct a sulfur test on
similar to those under EPA’s deposit injected would not cause any such the fuel batch after the addition of the
control additive rule (40 CFR part 80, batch of fuel to exceed the 15 ppm additive. Blenders of additives other
subpart G) which would show whether sulfur specification than S–D additives which have a sulfur
the S–D additive is being added at the • Quality assurance records which content greater than 15 ppm into diesel
appropriate rate on average over a show that the precision of the additive fuel subject to the 15 ppm sulfur
course of a monthly accounting period. injection equipment has been standard are also required to conduct a
Today’s rule finalizes the approach maintained in such a manner as to sulfur test on the fuel batch after the
suggested by commenters with certain prevent malfunctions which could addition of the additive for affirmative
modifications. In cases where a result in the injection of the S–D defense purposes.
violation of the 15 ppm sulfur cap for additive at a higher concentration than EPA may require additive
diesel fuel is discovered on a batch of that reported. manufactures to supply samples of the
fuel downstream of a blender of S–D The additive blender must also be additive packages (or the components
additives that have a sulfur content able to meet its normal diesel fuel additives in such packages) that are
above 15 ppm, the S–D additive blender defense elements: That the additive used in 15 ppm sulfur diesel fuel, or
must provide the following information blender-fuel distributor did not cause may sample from additive batches
to EPA in order to meet their affirmative the violation; that PTDs account for all already in the distribution system. In
defense to presumptive liability the fuel and show apparent compliance; such cases, we may test the sulfur
regarding the potential that the use of S– and that quality assurance sampling and content of these additives to evaluate
D additive might have caused or testing has occurred, as modified by the whether they are in compliance with the
contributed to the violation: discussion above. information provided on the PTDs or
• A sulfur test on the diesel batch In addition, the ratio of the amount of other relevant documentation. In cases
prior to the addition of the S–D additive additive used to the amount of fuel into where a violation is discovered, any
package that indicates that the additive, which the additive was injected over party in the distribution system that had
when added, will not cause the fuel to any given monthly VAR period must not custody of the additive batch found to
exceed 15 ppm exceed the maximum treatment rate be in violation may be held
• A product transfer document that which could be added to any batch of presumptively liable for the violation.
accompanied the transfer of the S–D fuel additized during the period. If not, Today’s rule amends the highway
additive package to the additive blender the blender could be liable for any batch diesel regulation so that the provisions
which contains the following: of diesel fuel found that exceeded the 15 finalized today regarding the use of S–
—A statement that the S–D additive ppm sulfur cap which had been in their D additives with a sulfur content above
package exceeds 15 ppm in sulfur possession. The above provisions are 15 ppm in NRLM diesel fuel also apply
content and that special requirements only relevant for establishing affirmative to the use of such additives in highway
apply if it is to be used in diesel fuel defense to presumptive liability diesel fuel subject to a 15 ppm sulfur
subject to the 15 ppm sulfur cap. regarding the potential that the use of S– standard. However, we continue to be
—The maximum sulfur level of the S– D additives might have caused a concerned about the use of additives
D additive package including other violation. Under no circumstances may having a sulfur content greater than 15
additive components such as diesel an additive blender cause the sulfur ppm. We will continue to monitor this
detergents and carrier fluid to the level of any batch of finished fuel to issue and may initiate an additional
extent that they are part of the exceed the 15 ppm sulfur cap. Blenders rulemaking in the future to consider
package. Each component of the of S–D additives must meet all other further limiting or prohibiting the use of
additive package other than the S–D requirements for distributors of 15 ppm greater than15 ppm sulfur additives in
additive itself must comply with the sulfur diesel fuel. Regardless of the diesel fuel subject to a 15 ppm sulfur
15 ppm sulfur cap. cause of a violation of the 15 ppm sulfur cap.
—The maximum recommended standard, any party that had custody or The special provisions for static-
concentration for the S–D additive title of off-specification fuel is dissipater additives finalized in today’s
package. potentially liable and responsible for rule will ensure that the unique
—The contribution to the final sulfur their affirmative defense elements. challenges regarding the manufacture
content of a finished fuel when the These provisions may only be used and use of such additives do not present
additive is added at the maximum for static dissipater additives which a barrier to their continued use.
recommended concentration. The have the potential to raise the sulfur Additive manufactures have stated that
maximum recommended content of the finished fuel by no more they are working on reformulation of
concentration must result in a than 0.050 ppm when used at their their S–D additives to meet a 15 ppm
potential increase in the sulfur maximum recommended treatment sulfur limit.
content of the finished fuel of no more level. Based on the input from additive We recently learned that industry is
than 0.05 ppm. manufacturers noted above, this will beginning to develop a standardized test
• Monthly volume accounting allow the use of S–D additives that are to quantify the concentration of static-
reconciliation (VAR) records that fully effective for this purpose. The use dissipater additives in finished fuel.163
include: of S–D additives that might have a If such a test were available, it might be
—The amount of S–D additive package higher contribution to the sulfur content useful for establishing an additive
used during the month of the finished fuel, therefore, is blender’s affirmative defense to
—The volume of the fuel into which the unnecessary. To establish affirmative presumptive liability in place of some of
additive was injected during the defense to presumptive liability, the VAR provisions described above. If
month blenders that use S–D additives that
—The measured sulfur level of each fuel could contribute more than 0.050 ppm 163 Phone conversation with Eon McMullen, Octel
batch prior to injection of the additive to the sulfur content of a finished fuel additives, February 12, 2004.
a batch of fuel was found to exceed the sulfur standard. We believe that the (3) Beginning December 1, 2010, no
15 ppm sulfur cap, the use of such a test requirement that NRLM fuel comply person may introduce, or permit the
would allow for the measurement of the with a 500 ppm sulfur cap throughout introduction of any fuel exceeding 500
contribution to the sulfur level of the the distribution system to the end-user ppm sulfur content into any nonroad,
finished fuel which resulted from the will be sufficient to ensure that entities locomotive, and marine engine; and
addition of the static dissipater additive. who introduce additives into such fuel
(4) Beginning December 1, 2014, no
If the contribution was below the take into account the potential increase
person may introduce, or permit the
permissible level given the sulfur in fuel sulfur content.
introduction of any fuel exceeding 15
measurements on each batch of fuel
d. Aftermarket Additives ppm sulfur content into any nonroad
additized with the greater than 15 ppm
S–D additive, it might be useful in We believe that more stringent diesel engine regardless of year of
association with other blender records requirements are needed for aftermarket manufacture.
to demonstrate that the additive blender additives than for bulk additives due to D. Diesel Fuel Sulfur Sampling and
was not at fault for the violation. If such the lack of practical safeguards to ensure Testing Requirements
a standardized test becomes available, that the use of such additives do not
EPA will work with the appropriate cause a violation of the sulfur standards 1. Testing Requirements
industry parties to evaluate its in today’s rule. Also, the presence of
applicability for affirmative defense multiple grades of aftermarket additives, Today’s action provides a new
purposes, and conduct a rulemaking if some suitable for use in engines approach for fuel sulfur measurement.
appropriate to amend the elements equipped with sulfur sensitive The details of this approach are
required to establish affirmative defense emissions control equipment as well as described below, followed by a
to presumptive liability under the pre-control engines, and some suitable description of who will be required to
NRLM and highway diesel programs. for use only in pre-control engines conduct fuel sulfur testing as well as
would raise significant concerns what fuel must be tested. The diesel fuel
c. Additives Used in 500 ppm Sulfur regarding the misuse. The misuse of a sulfur sampling and testing provisions
Diesel Fuel high sulfur additive in an engine with described below are similar to those that
The 1993 and 2007 highway diesel sulfur sensitive emissions control were proposed. Adjustments we made
programs did not contain any equipment could damage this to the proposed provisions were in
requirements regarding the maximum equipment. Therefore, today’s rule response to comments we received
sulfur content of additives used in requires that all aftermarket additives during the public comment period.
highway diesel fuel subject to a 500 sold for use in nonroad, locomotive, and
ppm sulfur cap.164 Our experience marine equipment must meet a 500 ppm a. Test Method Approval, Record-
under the highway program indicates sulfur cap beginning June 1, 2007, and keeping, and Quality Control
that application of the 500 ppm sulfur that all aftermarket additives sold for Requirements
cap throughout the distribution system use in nonroad equipment must meet a Most current and past EPA fuel
to the end-user has been sufficient to 15 ppm sulfur specification beginning programs designated specific analytical
prevent the use of additives from June 1, 2010. After June 1, 2010,
methods which refiners, importers, and
jeopardizing compliance with the 500 aftermarket additives with a sulfur
downstream parties 165 use to analyze
ppm sulfur standard. The potential content less than 500 ppm may continue
fuel samples at all points in the fuel
increase of several ppm in the sulfur to be used in locomotive and marine
distribution system for regulatory
content of diesel fuel which might result engines. This approach is consistent
from the use of some diesel additives with that taken in the highway diesel compliance purposes. Some of these
raises substantial concerns regarding the rule which requires all aftermarket programs have also allowed certain
impact on compliance with a 15 ppm additives to meet a 15 ppm sulfur specific alternative methods which may
sulfur cap. However, this is not the case specification beginning June 1, 2006. be used as long as the test results are
with respect to the potential impact on correlated to the designated test method.
6. End User Requirements The highway diesel rule (66 FR 5002,
compliance with a 500 ppm sulfur cap.
The current average sulfur content of In light of the importance of ensuring January 18, 2001), for example, specifies
highway diesel fuel of 340 ppm that the proper fuel is used in nonroad, one designated test method and three
provides ample margin for the minimal locomotive, and marine engines covered alternative methods for measuring the
increase in the fuel sulfur content which by this program, any person is sulfur content of highway diesel fuel
might result from the use of additives. prohibited from fueling such an engine subject to the 15 ppm sulfur standard.
We expect that this will also be the case with fuel not meeting the applicable The rule also specifies one designated
for NRLM fuel subject to the 500 ppm sulfur standard. method and three alternative methods
sulfur standard. Therefore, we are not Specifically: for measuring the sulfur content of
finalizing any requirements regarding (1) No person may introduce, or highway diesel fuel subject to the 500
the sulfur content of additives used in permit the introduction of fuel ppm sulfur standard.
NRLM fuel subject to the 500 ppm containing the heating oil marker into
nonroad, locomotive, marine or 165 Other EPA fuels regulations have allowed
164 The 500 ppm sulfur highway diesel final rule highway diesel engines; downstream parties conducting periodic quality
contains the requirement that highway diesel fuel (2) No person may introduce, or assurance testing for defense purposes to use
not exceed 500 ppm sulfur at any point in the fuel permit the introduction of, fuel that methods other than the designated method, so long
distribution system including after the blending of as the method is an ASTM method appropriate for
additives. Fuel Quality Regulations for Highway
exceeds 15 ppm sulfur content into testing for the applicable fuel property, and so long
Diesel Fuel Sold in 1993 and Later Calendar Years, nonroad equipment with a model year as the instrument is correlated to the designated
Final Rule, 55 FR 34120, August 21, 1990. 2011 or later engine; method.
TABLE V.H–1.—D ESIGNATED AND ALTERNATIVE SULFUR TEST METHODS ALLOWED UNDER THE HIGHWAY DIESEL
PROGRAM
Sulfur Test Method 500 ppm 15 ppm
ASTM D 2622–03, as modified, Standard Test Method for Sulfur in Petroleum Products Designated ....................... Alternative.
by Wavelength Dispersive X-ray Fluorescence Spectrometry.
ASTM D 3120–03a, Standard Test Method for Trace Quantities of Sulfur in Light Liquid ..................................... Alternative.
Petroleum Hydrocarbons by Oxidative Microcoulometry.
ASTM D 4294–03, Standard Test Method for Sulfur in Petroleum and Petroleum Prod- Alternative ........................
ucts by Energy-Dispersive X-ray Fluorescence Spectrometry.
ASTM D 5453–03a, Standard Test Method for Determination of Total Sulfur in Light Hy- Alternative ........................ Alternative.
drocarbons, Motor Fuels and Motor Oils by Ultraviolet Fluorescence.
ASTM D 6428–99, Test Method for Total Sulfur in Liquid Aromatic Hydrocarbons and Alternative ........................ Designated.
Their Derivatives by Oxidative Combustion and Electrochemical Detection.
The highway diesel fuel rule also government-unique standards where this issue, we are also clarifying that the
announced the Agency’s intention to such consensus standards would test results must in general be a
adopt a performance-based test method suffice. Under the performance criteria sequential record of the analyses with
approach in the future, as well as our approach in today’s rule, methods no omissions. A laboratory facility may
intention to continue working with the developed by consensus bodies as well exclude a given sample or test result
industry to develop and improve sulfur as methods not yet approved by a only if (1) the exclusion is for a valid
test methods. Today’s action adopts consensus body qualify for approval reason under good laboratory practices
such a performance-based test method provided they meet the specified and (2) it maintains records regarding
approach for both highway and NRLM performance criteria as well as the the sample and test results and the
diesel fuel subject to the 15 ppm and record-keeping and reporting reason for excluding them. Using the
500 ppm sulfur standards. In addition, requirements for quality control test results167 of ASTM D 3120 for
the current approach for measuring the purposes. diesel fuel subject to the 15 ppm sulfur
sulfur content of diesel fuel subject to standard, the precision must be less
i. How Can a Given Method Be
the 500 ppm sulfur standard, i.e., using than 0.72 ppm.168 Similarly, using the
Approved?
the designated sulfur test method or one test results of ASTM D 2622 for diesel
of the alternative test methods with A given test method can be approved fuel subject to the 500 ppm sulfur
correlation will remain applicable. for use under today’s program by standard, the precision must be less
meeting certain precision and accuracy than 9.68 ppm.
Under the performance-based
criteria. Approval applies on a The second criterion, accuracy, refers
approach, a given test method can be
laboratory/facility-specific basis. If a to the closeness of agreement between a
approved for use in a specific laboratory
company chooses to employ more than measured or calculated value and the
by meeting certain precision and
one laboratory for fuel sulfur testing actual or specified value. To
accuracy criteria specified in the
purposes, then each laboratory must demonstrate the accuracy of a given test
regulations. The method can be
separately seek approval for each method under the performance-based
approved for use by that laboratory as
method it intends to use. Likewise, if a approach, a laboratory facility is
long as appropriate quality control laboratory chooses to use more than one required to perform 10 repeat tests on a
procedures are followed. Properly sulfur test method, then each method
selected precision and accuracy values must be approved separately. Separate 167 Sulfur Repeatability of Diesel by Method at 15
allow multiple methods and multiple approval is not necessary for individual ppm, ASTM Report on Low Level Sulfur
commercially available instruments to operators or laboratory instruments Determination in Gasoline and Diesel
be approved, thus providing greater Interlaboratory Study—A Status Report, June 2002.
within a given laboratory facility. 168 0.72 ppm is equal to 1.5 times the standard
flexibility in method and instrument The specific precision and accuracy deviation of ASTM D 3120, where the standard
selection while also encouraging the criteria were derived from existing deviation is equal to the repeatability of ASTM D
development and use of better methods sulfur test methods that are either 3120 (1.33) divided by 2.77. 9.68 ppm is equal to
and instrumentation in the future. 1.5 times the standard deviation of ASTM D 2622,
required or allowed under the highway where the standard deviation is equal to the
Under today’s rule, there is no diesel fuel sulfur program. The first repeatability of ASTM D 2622 (17.88) divided by
designated sulfur test method as criterion, precision, refers to the 2.77. In the proposal, we stated that the
specified under previous regulations. consistency of a set of measurements repeatability of ASTM D 2622 was 26.81. While that
reported value was incorrect due to either a
Since any test method that meets the and is used to determine how closely typographical or a computational error, the
specified performance criteria may analytical results can be duplicated resulting precision value that we are finalizing
qualify, this type of approach does not based on repeat measurements of the today was correctly calculated and reported as 9.68
conflict with the ‘‘National Technology ppm. The ‘‘sample standard deviation’’ should be
same material under prescribed used for this purpose. By its use of N–1 in the
Transfer and Advancement Act of 1995’’ conditions. To demonstrate the denominator, this measure applies a correction for
(NTTAA), section 12(d) of Public Law precision of a given sulfur test method the small sample bias and provides an unbiased
104–113, and the Office of Management under the performance-based approach, estimate of the standard deviation of the larger
population from which the sample was drawn.
and Budget (OMB) Circular A–119. Both a laboratory facility must perform 20 Since the conditions of the precision qualification
of these are designed to encourage the repeat tests over 20 days on samples test admit more sources of variability than the
adoption of standards developed by taken from a homogeneous supply of a conditions under which ASTM repeatability is
‘‘voluntary consensus standards bodies’’ commercially available diesel fuel. determined (longer time span, different operators,
environmental conditions, etc.) the repeatability
(VCSB) 166 and to reduce reliance on Based on the comments we received on standard deviation derived from the round robin
was multiplied by what we believe to be a
166 These are standard-setting organizations, like all interested stakeholders and make decisions by reasonable adjustment factor, 1.5, to compensate for
ASTM, and ISO that have broad representation of consensus. the difference in conditions.
standard sample, the mean of which for are required to retain the fuel samples the initial quality of a method and a
diesel fuel subject to the 15 ppm sulfur used for precision and accuracy company may have invested significant
standard can not deviate from the demonstration for 90 days. While we resources in developing a method.
Accepted Reference Value (ARV) of the proposed a 30 day sample retention However, if after a reasonable time a test
standard by more than 0.54 ppm and for period, commenters stated that the method fails to gain consensus body
diesel fuel subject to the 500 ppm sulfur sample retention period for fuel samples approval, EPA believes approval of the
standard can not deviate from the ARV that are used for precision and accuracy method should be withdrawn because of
of the standard by more than 7.26 demonstrations should be equivalent to the absence of ongoing consensus
ppm 169. These tests must be performed the length of EPA’s review period (i.e., oversight. Accordingly, a non-VCSB
using commercially available 90 days). We agree with the commenters method will cease to be qualified five
gravimetric sulfur standards. Ten tests and are thus finalizing a 90 day sample years from the date of its original
are required using each of two different retention period in today’s rule. This approval by EPA in the absence of VCSB
sulfur standards. For 15 ppm fuel, one sample retention requirement also approval.
must be in the range of 1–10 ppm sulfur applies to non-VCSB methods which are To assist the Agency in determining
and the other in the range of 10–20 ppm described below. the performance of a given sulfur test
sulfur. For 500 ppm fuel, one must be For test methods that have not been method, non-VCSB methods, in
in the range of 100–200 ppm sulfur and approved by a VCSB, full test method particular, we reserve the right to send
the other in the range of 400–500 ppm documentation, including a description samples of commercially available fuel
sulfur for 500 ppm sulfur diesel fuel. of the technology/instrumentation that to laboratories for evaluation. Such
Therefore, a minimum of 20 total tests makes the method functional, as well as samples are intended for situations in
is required for sufficient demonstration subsequent EPA approval of the method which the Agency has concerns
of accuracy for a given sulfur test is also required. These submissions will regarding a test method and, in
method at a given laboratory facility. As also be subject to the Agency’s review particular, its ability to measure the
with the requirement for precision for 90 days, and the method will be sulfur content of a random
demonstration described above, the test considered approved in the absence of commercially available diesel fuel.
results must be a sequential record of EPA comment. Submission of VCSB Laboratory facilities are required to
the analyses with no omissions. Finally, methods is not required since they are report their results from tests of this
any known interferences for a given test available in the public domain. In material to the Agency.
method must be mitigated. addition, industry and the Agency will
iii. What Quality Control Provisions Are
Some commenters remarked that the likely have had substantial experience
Required?
ARV of the standards does not account with such methods.
As described above, federal We are requiring ongoing Quality
for any uncertainty given that all
government and EPA policy is to use Control (QC) procedures for sulfur
commercially available standards have
standards developed by voluntary measurement instrumentation. These
an uncertainty associated with the
consensus bodies when available. The are procedures used by laboratory
certified value. The commenters added
purpose of the NTTAA, at least in part, facilities to ensure that the test methods
that EPA should specify what maximum
is to foster consistency in regulatory they have qualified and the instruments
value in the uncertainty associated with
requirements, to take advantage of the on which the methods are run are
the ARV is allowed.
collective industry wisdom and wide- yielding results with appropriate
These requirements are not intended
spread technical evaluation required accuracy and precision, e.g., that the
to be overly burdensome. Indeed, we
before a test method is approved by a results from a particular instrument do
believe these requirements are
consensus body, and to take advantage not ‘‘drift’’ over time to yield
equivalent to what a laboratory would
of the ongoing oversight and evaluation unacceptable values. It is our
do during the normal start up procedure
of a test method by the consensus body understanding that most laboratories
for a given test method. In addition, we
that results from wide-spread use of an already employ QC procedures, and that
believe this approach will allow
approved method e.g., the ongoing these are commonly viewed as
regulated entities to know that they are
round-robin type analysis and typical important good laboratory practices.
measuring diesel fuel sulfur levels
annual updating of the method by the Laboratories will be required, at a
accurately and within reasonable site
consensus body. These goals are not met minimum, to abide by the following QC
reproducibility limits.
where the Agency allows use of a non- procedures for each instrument used to
ii. What Information Must Be Reported consensus body test method in test batches of diesel fuel under these
to the Agency? perpetuity. Moreover, it is not possible regulations even where a laboratory
For test methods that have already to realize many of the advantages that elects to use the test method used to
been approved by a VCSB, such as result from consensus status where a establish the precision and accuracy
ASTM or the International Standards test method is used by only one or a few criteria finalized in today’s rule:
Organization (ISO), each laboratory companies. It will not have the practical (1) Follow the mandatory provisions
facility must report to the Agency the scrutiny that comes from ongoing wide- of ASTM D 6299–02, Standard Practice
precision and accuracy results as spread use, or the independent scrutiny for Applying Statistical Quality
described above for each method for of the consensus body and periodic Assurance Techniques to Evaluate
which it is seeking approval. Such updating. In addition, EPA does not Analytical Measurement System
submissions to EPA, as described have the resources to conduct the degree Performance. Laboratories are required
elsewhere, are subject to the Agency’s of initial scrutiny or ongoing scrutiny to construct control charts from the
review for 90 days, and the method will that are practiced by consensus bodies. mandatory QC sample testing prescribed
be considered approved in the absence Nevertheless, EPA believes it is in paragraph 7.1, following the
of EPA comment. Laboratory facilities appropriate to allow limited use of a guidelines under A 1.5.1 for individual
proprietary test method for a limited observation charts and A 1.5.2 for
169 0.54 and 7.26 are equal to 0.75 times the time, even though the significant moving range charts.
precision values of 0.72 for 15 ppm sulfur diesel advantages of consensus test methods (2) Follow ASTM D 6299–02
and 9.68 for 500 ppm sulfur diesel, respectively. are absent, because EPA can evaluate paragraph 7.3.1 (check standards) using
a standard reference material. Check this batch testing requirement to15 ppm this compliance provision. We also
standard testing is required to occur at sulfur highway diesel fuel beginning in received comments that a test tolerance
least monthly and should take place 2006. should be provided in determining
following any major change to the In order to address situations where compliance with the 500 ppm sulfur
laboratory equipment or test procedure. refiners produce NRLM diesel fuel using standards for NRLM fuel. We believe
Any deviation from the accepted computer-controlled inline blending that such a tolerance is not needed for
reference value of the check standard equipment and do not have storage fuels subject to a 500 ppm sulfur
greater than 1.44 ppm for diesel fuel tanks from which to withdraw samples, standard because of the flexibility that
subject to the 15 ppm sulfur standard we are including in today’s final rule a refiners possess to produce fuel with a
and 19.36 ppm for diesel fuel subject to provision to allow refiners to test a sufficiently low sulfur content to
the 500 ppm sulfur standard170 must be composited sample of a batch of diesel accommodate test variability.
investigated. fuel for its sulfur content after the diesel
fuel has been shipped from the refinery. 3. Sampling Requirements
(3) Upon discovery of any QC testing
violation of A 1.5.2.1 or A 1.5.3.2 or This inline blending provision is similar Today’s rule adopts the same
check standard deviation greater than to the provision that exists under the sampling methods adopted by the
1.44 ppm and 19.36 ppm for 15 ppm reformulated gasoline and gasoline highway diesel rule (66 FR 5002,
sulfur diesel and 500 ppm sulfur diesel, sulfur programs and applies to both January 18, 2001). These sampling
respectively, as provided in item 2 highway and NRLM diesel fuel under methods are American Society for
above, any measurement made while today’s action. Testing and Materials (ASTM) D 4057–
the system was out of control must be Today’s rule does not require 95 (manual sampling) and D 4177–95
tagged as suspect and an investigation downstream parties to conduct every- (automatic sampling from pipelines/in-
conducted into the reasons for this batch testing. However, we believe that line blending). The requirement to use
anomalous performance. Refiners and most downstream parties will these methods becomes effective for
importers are required to retain batch voluntarily conduct ‘‘periodic’’ NRLM diesel fuel on June 1, 2007.
samples for 30 days or the period equal sampling and testing for quality These same methods were also adopted
to the interval between QC sample tests, assurance purposes if they want to for use in the Tier 2/Gasoline Sulfur
whichever is longer. If an instrument is establish a defense to presumptive rule.171
found to be out of control, all of the liability, as discussed in section V.H.
below. 4. Alternative Sampling and Testing
retained samples since the last time the Requirements for Importers of Diesel
instrument was shown to be in control 2. Two Part-Per-Million Downstream Fuel Who Transport Diesel Fuel by
must be retested. Sulfur Measurement Adjustment Tanker Truck
(4) QC records, including We believe that it is appropriate to
investigations under item 3 above must We understand that importers who
recognize sulfur test variability in transport diesel fuel into the U.S. by
be retained for five years and must be determining compliance with the 15
provided to the Agency upon request. tanker truck are frequently relatively
ppm sulfur NRLM diesel fuel standards
small businesses that could be subject to
b. Requirements To Conduct Fuel Sulfur downstream of a refinery or import
a substantial burden if they were
Testing facility. Thus, today’s rule provides that
required to sample and test each batch
for all 15 ppm sulfur NRLM diesel fuel
Given the importance of assuring that of NRLM or highway diesel fuel
at locations downstream of a refinery or
NRLM diesel fuel designated to meet the imported by truck, especially where a
import facility, sulfur test results can be
15 ppm sulfur standard in fact meets trucker imports many small loads of
adjusted by subtracting two ppm. In the
that standard, we are requiring that diesel fuel. Therefore, today’s rule
same manner as finalized for 15 ppm
refiners, importers, and transmix provides that truck importers may
sulfur highway diesel fuel, the sole
processors test each batch of NRLM purpose of this downstream compliance comply with an alternative sampling
diesel fuel designated to meet the 15 provision is to address test variability and testing requirement, involving a
ppm sulfur standard and maintain concerns (see the highway diesel fuel sampling and testing program of the
records of such testing. Requiring that rule). We received comments suggesting foreign truck loading terminal, if certain
refiners, importers, and transmix that a higher downstream test tolerance conditions are met. For an importer to
processors test each batch of fuel subject is needed based on the current values be eligible for the alternative sampling
to the 15 ppm sulfur NRLM standard for test method variability. However, we and testing requirement, the terminal
assures that compliance can be anticipate that the reproducibility of must conduct sampling and testing of
confirmed through testing records, and sulfur test methods is likely to improve the NRLM or highway diesel fuel
even more importantly, assures that to two ppm or even less by the time the immediately after each receipt into its
diesel fuel exceeding the 15 ppm 15 ppm sulfur standard for highway terminal storage tank but before loading
standard is not introduced into diesel fuel is implemented—four years product into the importer’s tanker truck
commerce as fuel for use in nonroad before implementation date of the 15 storage compartments or immediately
equipment having sulfur-sensitive ppm standard for NRLM diesel fuel. prior to loading product into the
emission control devices. Batch testing With this provision, we anticipate that importer’s tanker truck if it hasn’t tested
was not required under the highway refiners will be able to produce diesel after each receipt. Moreover, the
diesel fuel rule. Instead, such testing fuel with an average sulfur level of importer will be required to conduct
was expected to be performed to approximately 7–8 ppm and some periodic quality assurance testing of the
establish a defense to potential liability. contamination could occur throughout terminal’s diesel fuel, and the importer
However, for the same reasons the distribution system, without fear of will be required to assure EPA that we
discussed above, today’s rule extends causing a downstream violation due will be allowed to make unannounced
170 1.44 ppm is equal to two times the precision

solely to test variability. As test methods 171 65 FR 6833–34 (Feb. 10, 2000). Today’s rule
value of 0.72 ppm for 15 ppm diesel and 19.36 is

improve in the future, we will also provides that these methods be used under the
equal to two times the precision value of 9.68 ppm reevaluate whether two ppm is the RFG and CG rules. See 62 FR 37337 et seq. (July
for 500 ppm diesel. appropriate allowance for purposes of 11, 1997).
inspections and audits, to sample and NRLM diesel fuel generated under the heating oil dealers, retailers, and even
test fuel at the foreign terminal facility, downstream flexibility provisions in end-users with storage tanks such as
to assure that the terminal maintained today’s rule could be sold into the LM farmers. Reporting errors for even a
sampling and testing records, and to market outside of the Northeast/Mid- small fraction would require too many
submit such records to EPA upon Atlantic Area and Alaska. Such 500 resources to track down and correct and
request. ppm sulfur NRLM diesel fuel does not would eliminate the effectiveness of the
need to be marked. Therefore, both system.
E. Selection of the Marker for Heating marked and unmarked 500 ppm sulfur Our proposal envisioned that a fuel
Oil diesel fuel could be used in locomotive marker would be required in heating oil
As discussed in section IV.D, to and marine diesel equipment outside of from June 1, 2006 through May 31,
ensure that heating oil is not shifted into the Northeast/Mid-Atlantic Area and 2010, and that the same marker would
the NRLM market, we need a way to Alaska from 2010 through 2012.173 be required in locomotive and marine
distinguish heating oil from high sulfur As discussed in section IV.D., use of fuel from June 1, 2010 through May 31,
or 500 ppm sulfur NRLM diesel fuel the same marker in heating oil and 500 2014. As a consequence of finalizing the
produced under the small refiner and ppm sulfur LM fuel is feasible because 15 ppm sulfur standard for locomotive
credit provisions in today’s rule. the underlying goal is the same, i.e., and marine fuel in 2012, we no longer
Currently, there is no differentiation keeping 500 ppm sulfur diesel fuel need to require that LM diesel fuel be
today between fuel used for NRLM uses produced as heating oil or LM fuel from marked after June 1, 2012. The 2010–
and heating oil. Both are typically begin shifted into the nonroad diesel 2012 marking requirement for 500 ppm
produced to the same sulfur market from 2010 through 2012. We will sulfur LM diesel fuel does not apply to
specification, and both are required to be able to determine whether heating oil 500 ppm sulfur LM fuel produced by a
have the same red dye added prior to with a sulfur content greater than 500 refiner or imported in the Northeast/
distribution from downstream of the ppm has been shifted into the LM Mid-Atlantic Area or in Alaska. There is
terminal. Based on recommendations market downstream of the terminal by an ongoing need to require the
from refiners, in the NPRM, we testing the sulfur content of LM. 500 continued use of the marker in heating
concluded that the best approach to ppm fuel initially designated as heating oil indefinitely (see section IV of today’s
differentiate heating oil from NRLM oil can be later shifted into the LM preamble).
diesel fuel would be to require that a market, since the sulfur standard for LM We proposed that beginning June 1,
marker be added to heating oil at the diesel fuel during this period is 500 2007 SY–124 must be added to heating
refinery gate. Since the proposal we ppm. oil in the U.S. at a concentration of 6
received additional information which Terminal operators suggested that we milligrams per liter (mg/L). Today’s rule
allows us to rely upon record-keeping might be able to rely on record-keeping adopts this requirement except for
and reporting provisions to differentiate and reporting downstream of the heating oil used in the Northeast/Mid-
heating oil from NRLM up to the point terminal as well as above the terminal Atlantic Area and Alaska.174 The
where it leaves the terminal (see section level, thereby eliminating any need for chemical composition of SY–124 is as
IV.D). Therefore, today’s rule requires a fuel marker. However, we believe such follows: N-ethyl-N-[2-[1-(2
that a marker be added to heating oil record-keeping and reporting methylpropoxy)ethoxyl]-4-phenylazo]
before it leaves the terminal gate rather mechanisms would be insufficient to benzeneamine.175 This concentration is
than the refinery gate as proposed.172 keep heating oil out of the NRLM sufficient to ensure detection of SY–124
Section IV.D of today’s preamble also market and 500 ppm sulfur LM fuel in the distribution system, even if
discusses the need to distinguish 500 produced by a refiner or imported out diluted by a factor of 50. Any fuel found
ppm sulfur locomotive and marine fuel of the nonroad market downstream of with a marker concentration of 0.1
produced by refiners and imported from the terminal under typical milligrams per liter or more will be
2010–2012 from 500 ppm sulfur circumstances. We can rely on such presumed to be heating oil. Below this
nonroad diesel fuel produced during measures before the fuel leaves the level, the prohibition on use in
this time frame under the small refiner, terminal because it is feasible to require highway, nonroad, locomotive, or
credit, and downstream flexibility all of the facilities in the distribution marine applications would not apply.
provisions in today’s rule. Without this system to report to EPA on their fuel There are a number of other types of
ability, it would be possible for 500 ppm transfers. As discussed in section IV.D., dyes and markers. Visible dyes are most
sulfur LM diesel fuel to be shifted into these electronic reports can be common, are inexpensive, and are easily
the nonroad market during this time compared by EPA to identify parties detected. Using a second dye in
period outside of the Northeast/Mid- responsible for shifting heating oil into addition to the red dye required by IRS
Atlantic Area and Alaska. Therefore, the NRLM market from 2007–2014, 500 in all non-highway fuel for segregation
today’s rule requires that from June 1, ppm sulfur LM fuel into the nonroad of heating oil based on visual
2010 through May 31, 2012, the same market from 2010–2012, and heating oil identification raises certain challenges.
marker added to heating oil must also be into the LM market beginning 2014. The marker that we require in heating
added to 500 ppm sulfur LM diesel fuel Downstream of the terminal the parties oil and 500 ppm sulfur LM diesel fuel
produced by a refiner or imported for involved in the fuel distribution system must be different from the red dye
use outside of the Northeast/Mid- become far too numerous for such a currently required by IRS and EPA and
Atlantic Area and Alaska before the fuel system to be implemented and enforced not interfere with the identification of
leaves the terminal. Nonroad diesel fuel (including jobbers, bulk plant operators, red dye in distillate fuels. Invisible
meeting a 500 ppm sulfur standard 174 See section IV.D of today’s preamble for a
173 Inside the Northeast/Mid-Atlantic Area, 500
produced under the small refiner or discussion of the provisions for the Northeast/Mid-
ppm sulfur fuel produced from transmix or
credit provisions, and 500 ppm sulfur segregated interface could be sold into the LM or Atlantic Area and Alaska.
heating oil markets from 2010–2012, and could only 175 Opinion on Selection of a Community-wide
172 Heating oil sold inside the Northeast/Mid- be sold into the heating oil market after 2012. Mineral Oils Marking System, (‘‘Euromarker’’),
Atlantic Area adopted under today’s rule and Outside of the Northeast/Mid-Atlantic Area, such European Union Scientific Committee for Toxicity,
Alaska does not need to contain a marker (see fuel could be sold into the NRLM market from Ecotoxicity and the Environment plenary meeting,
section IV.D.). 2010–2012, and into the LM market thereafter. September 28, 1999.
markers are beginning to see more use concentration of red dye in distillate The American Society of Testing and
in branded fuels and are somewhat fuel. Thus, the use of SY–124 at 6 mg/ Materials (ASTM), the Coordinating
more expensive than visible markers. L in diesel fuel would not interfere with Research Council (CRC), and the Federal
Such markers are detected either by the the use of the red dye by IRS to identify Aviation Administration (FAA)
addition of a chemical reagent or by non-taxed fuels. requested that we delay finalizing the
their fluorescence when subjected to Solvent yellow 124 is chemically selection of a specific marker for use in
near-infra-red or ultraviolet light. Some similar to other additives used in heating oil in today’s rule. They
chemical-based detection methods are gasoline and diesel fuel, and has been requested that selection of a specific
suitable for use in the field. Others must registered by EPA as a fuel additive marker should be deferred until testing
be conducted in the laboratory due to under 40 CFR part 79. Therefore, we could be conducted regarding the
the complexity of the detection process expect that its products of combustion potential impact of SY–124 on jet
or concerns regarding the toxicity of the would not have an adverse impact on engines. The Air Transport Association
reagents used to reveal the presence of emission control devices, such as a stated that EPA should conduct an
the marker. Near-infra-red and ultra- catalytic converter. Extensive evaluation extensive study regarding the potential
violet flourescent markers can be easily and testing of SY–124 was conducted by for contamination, determine the levels
detected in the field using a small the European Commission. This at which the marker will not pose a risk
device and after brief training of the included combustion testing which to jet engines, and seek approval of SY–
operator. There are also more exotic showed no detectable difference 124 as a jet fuel additive. Other parties
markers available such as those based between the emissions from marked and including the Department of Defense
on immunoassay, and isotopic or unmarked fuel. Norway specifically (DoD) also stated that EPA should
molecular enhancement. Such markers evaluated the use of distillate fuel refrain from specifying a heating oil
typically need to be detected by containing SY–124 for heating purposes marker under today’s rule until industry
laboratory analysis. and determined that the presence of the and other potentially affected parties
We selected SY–124, however, for a Euromarker did not cause an increase in can recommend an appropriate marker.
number of reasons: harmful emissions from heating Representatives of the heating oil
(1) There is considerable data and equipment. Based on the European industry stated that they were
experience with it which indicates there experience with SY–124, we do not concerned that EPA had not conducted
are no significant issues with its use; expect that there would be concerns an independent review regarding the
(2) It is compatible with the existing regarding the compatibility of SY–124 safety/suitability of SY–124 for use in
red dye; in the U.S. fuel distribution system or heating oil.
(3) Test methods exist to quantify its We met and corresponded with
for use in motor vehicle engines and
concentration, even if diluted by a factor numerous and diverse parties to
other equipment such as in residential
of 50 to one; evaluate the concerns expressed
(4) It is reasonably inexpensive; and furnaces.
regarding the use of SY–124, and to
(5) It can be produced and provided Our evaluation of the process determine whether it might be more
by a number of sources. conducted by the EU in selecting SY– appropriate to specify a different marker
Effective in August 2002, the 124 for use in the EU convinced us that for use in heating oil. These parties
European Union (EU) enacted the SY–124 was also the most appropriate include IRS, FAA, ASTM, CRC, various
requirement that SY–124 be added at 6 marker to propose for use in heating oil marker/dye manufacturers, European
mg/L to diesel fuel that is taxed at a under today’s program. We received a distributors of fuels containing the
lower rate in all EU member states.176 number of comments expressing Euromarker, marker suppliers, and
Solvent yellow 124 is referred to as the concern about the use of SY–124 in members of all segments in the U.S. fuel
‘‘Euromarker’’ in the EU. The EU has heating oil. Based on our evaluation of distribution system.
found this treatment rate to be sufficient these comments (summarized below We believe that concerns related to
for their enforcement purposes while and in the S&A), we continue to believe potential jet fuel contamination have
not interfering with the identification of that SY–124 is the most appropriate been sufficiently addressed for us to
the various different colored dyes marker to specify for use in heating oil finalize the selection of SY–124 as the
required by different EU member states and 500 ppm sulfur LM diesel fuel required heating oil marker in today’s
(including the same red dye that is under today’s rule. Therefore, today’s rule.178 As discussed in section IV.D of
required in the U.S.). Despite its name, rule requires that beginning June 1, today’s preamble, changes in the
SY–124 does not impart a strong color 2007, SY–124 be added to heating oil, structure of the fuel program finalized
to diesel fuel when used at a and that from June 1, 2010 through May in today’s rule from that in the proposed
concentration of 6 mg/L. Most often it 31, 2012, SY–124 be added to 500 ppm program have allowed us to move the
is reportedly nearly invisible in sulfur LM diesel fuel produced by a point where the marker must be added
distillate fuel given that the slight refiner or imported at a concentration of from the refinery gate to the terminal.
yellow color imparted is similar to the 6 mg/L before such fuel leaves the The vast majority of concerns regarding
natural color of many distillate fuels.177 terminal except in the Northeast/Mid- the potential for contamination of jet
In the presence of red dye, SY–124 can Atlantic Area and Alaska. fuel with SY–124 pertained to the
impart a slight orange tinge to the fuel. The concerns regarding the use of SY– shipment of marked fuel by pipeline.
However, it does not interfere with the 124 in heating oil primarily pertained All parties were in agreement that
visual identification of the presence of to: the potential impact on jet engines if nearly all of the potential for marker
red dye or the quantification of the jet fuel were contaminated with SY– contamination of jet fuel would
124; the potential health effects of SY– disappear if the point of marker
176 The European Union marker legislation, 2001/ 124 when used in fuel for heating addition was moved to the terminal. We
574/EC, document C(2001) 1728, was published in purposes, particularly for unvented
the European Council Official Journal, L203 heaters; the potential cost impact on 178 See the Summary and Analysis of Comments
28.072001. for a more detailed discussion of our response to
177 The color of distillate fuel can range from near fuel distributors and transmix concerns about the possible contamination of jet
water white to a dark blackish brown but is most processors; and the potential conflict fuel with the marker prescribed for use in heating
frequently straw colored. with IRS red dye requirements. oil and 500 ppm sulfur LM fuel under today’s rule.
spoke with terminal operators, both distribution of marked LM diesel fuel impacts from the use of SY–124 do not
large and small, who confirmed that will primarily be by segregated present sufficient cause to delay
they maintain strictly segregated pathways, and the duration of the finalization of the requirement for it’s
distribution facilities for red dyed fuel marker requirement for 500 ppm sulfur use that is contained in today’s rule.
and jet fuel because of jet fuel LM diesel fuel produced by refiners or The European Union intends to
contamination concerns. The same type imported for use outside of the review the use of SY–124 after
of segregation practices will apply to the Northeast/Mid-Atlantic Area and Alaska December 2005, but may undertake the
handling of marked heating oil, marked is only two years. On the whole, we review earlier if any health and safety or
500 ppm sulfur LM diesel fuel, and jet actually expect that today’s rule will environmental concerns about its use
fuel since the marker will only be reduce the potential for jet fuel to are raised. We intend to keep abreast of
present in heating oil and locomotive become contaminated with the azo dyes such activities and may initiate our own
and marine fuel when red dye is also such as the IRS-required red dye and review of the use of SY–124 depending
present. Therefore, these practices will SY–124 since visual evidence will no on the European Union’s findings, or
be equally effective in limiting longer be required leaving the refinery other relevant information. There will
contamination of jet fuel with SY–124. gate in 500 ppm NRLM fuel beginning be nearly four years of accumulated
Downstream of the terminal, the only June 1, 2007, and will no longer be field experience with the use of SY–124
other chance for marker contamination required in any off-highway diesel fuel in Europe at the time of the review by
of jet fuel pertains to bulk plant beginning June 1, 2010. the EU and nearly 5 years by the
operators and jobbers that handle This final rule requires addition of the implementation of the marker
marked heating oil and jet fuel. For the marker at the terminal rather than the requirement under today’s rule. This
most part, these parties also currently refinery gate as proposed. Based on this will provide ample time for any
maintain strict segregation of the change, ASTM withdrew its request to potential unidentified issues with SY–
facilities used to transport jet fuel and delay the finalization of the marker 124 to be identified, and for us to
heating oil. The one exception is that requirements in today’s rule. However, choose a different marker if warranted.
small bulk plant operators that supply ASTM stated that some concern remains Commenters stated that potential
small airports sometimes use the same regarding jet fuel contamination health concerns regarding the use of
tank truck to alternately transport jet downstream of the terminal (due to the SY–124 might be exacerbated with
fuel and heating oil. In such cases, they limited use of the same tank wagons to respect to its use in unvented space
flush the tank compartment prior to alternately transport jet fuel and heating heaters. Commenters further stated that
transporting jet fuel to remove any oil discussed above). Nevertheless, there are prohibitions against the dyeing
residual heating oil left behind after the ASTM related that these concerns need of kerosene (No. 1 diesel) used in such
not delay finalization of the marker heaters. No information was provided to
tank is drained. Since few, if any bulk
requirements in this rule. ASTM intends support these concerns, however, and
plants handle LM fuel, it is unlikely that
to support a CRC program to evaluate we have no information to suggest any
the same tank trucks will be used to
the compatibility of markers with jet health concerns exist regarding the use
alternately transport LM fuel and jet
fuel. The Federal Aviation of SY–124 in unvented heaters.
fuel. Thus, we expect that there will be
Administration is also undertaking an Nevertheless, even if there were such
even less chance for LM fuel containing
effort to identify fuel markers that concerns, today’s rule will not require
the marker to contaminate jet fuel.
would be compatible for use in jet fuel. SY–124 to be used in the fuel used in
Today’s rule requires that heating oil We commit to a review of the use of SY– unvented heaters. Furthermore, today’s
and locomotive and marine fuel which 124 in the future based on the findings rule, does not require that SY–124 be
contains the marker must also contain of the CRC and the FAA, experience added to kerosene. This resolves most of
visible evidence of red dye. Therefore, with the use of SY–124 in Europe, and what concern might remain regarding
the ‘‘white bucket’’ test that distributors future input from ASTM or other this issue, since kerosene is the
currently use to detect red dye concerned parties. If alternative markers predominate fuel used in unvented
contamination of jet fuel can also be are identified that do not raise concerns heaters. However, the DoD stated that
relied upon to detect marker regarding the potential contamination of No. 2 diesel fuel is sometimes used in
contamination of jet fuel. Based on the jet fuel, we will initiate a rulemaking to its tent heaters and expressed concern
above discussion, we concluded that the evaluate the use of one of these markers regarding the presence of SY–124 in fuel
required addition of the marker to in place of SY–124. used for this purpose. We understand
heating oil and 500 ppm sulfur Since the NPRM, no new information that to simplify the DoD fuel
locomotive and marine fuel from 2010– has been provided which indicates that distribution system, it is DoD policy to
2012 would not significantly increase the combustion of SY–124 in heating use a single fuel called JP–8 for multiple
the likelihood of jet fuel contamination, equipment would result in more purposes where practicable, including
and that when such contamination harmful emissions than when space heating. JP–8 used for such a
might occur, it could be readily combusted in engines, or would result purpose would not be subject to today’s
identified without the need for in more harmful emissions than fuel marker requirement. In cases where
additional testing. Our finalization of combustion of unmarked heating oil. JP–8 might not be available for space
the Northeast/Mid-Atlantic Area in (see The European experience with the use heating, DoD could avoid the use of SY–
section IV.D) also minimizes potential of SY–124 and the evaluation process it 124 containing fuel by using kerosene in
concerns regarding the potential that jet underwent prior to selection by the EU, their space heaters.
fuel may become contaminated with the provides strong support regarding the We believe that the concerns
marker, since no marker is required in compatibility of SY–124 in the U.S. fuel expressed regarding the potential
this area. Furthermore, there is expected distribution system, and for use in impact on distributors and transmix
to be little heating oil used outside of motor vehicle engines and other processors from the presence of SY–124
the Northeast/Mid-Atlantic Area, the equipment such as in residential in heating oil and 500 ppm sulfur LM
locomotive and marine market outside furnaces and nonroad, locomotive, and fuel have been addressed by moving the
of the Northeast/Mid-Atlantic Area is marine engines. We believe that point of marker addition to the terminal.
limited. We anticipate that the concerns regarding the potential health Terminal operators stated that they
desire the flexibility to blend 500 ppm We do not expect that the fuel marker to adopt one of the markers from the
diesel fuel from 15 ppm diesel fuel and requirements will result in the need for family of markers that they are
heating oil. This practice would have additional fuel storage tanks or tank investigating. Given the changes to our
been prevented by the proposed trucks in the distribution system. As program in today’s final rule, the marker
addition of the marker at the refinery discussed in section VI.A of today’s provisions will not impose a significant
gate. Under today’s rule, terminal preamble, the implementation of the burden. However, if the IRS program
operators will have access to unmarked NRLM sulfur standards in today’s rule were to develop an alternate marker that
high sulfur fuel with which to is projected to result in the need for would be compatible with jet we will
manufacture 500 ppm diesel fuel by additional storage tanks and tank truck initiate a rulemaking to evaluate the use
blending with 15 ppm diesel fuel.179 de-manifolding at a limited number of of one of these markers in place of SY–
Transmix processors stated that the bulk plant facilities. The marker 124 (see section VIII.H.).
presence of a marker in transmix would requirement does not add another Commenters also expressed concerns
limit the available markets for their criteria apart from the sulfur content of regarding the proprietary rights related
reprocessed distillates. The feed the fuel which would force additional to the manufacture and use of SY–124,
material for transmix processors product segregation. As discussed and stated that EPA should adopt a
primarily consists of the interface above, industry has expressed concern nonproprietary marker if possible. The
mixing zone between batches of fuels about the use of the same tank trucks to proprietary rights related to SY–124
that abut each other during shipment by alternately transport heating oil and jet expire several months after the
pipeline where this mixing zone can not fuel. We do not expect that the addition implementation of the marker
be cut into either of the adjacent of marker to heating oil and 500 ppm requirements finalized in today’s rule.
products. If marked heating oil and sulfur LM diesel fuel will exacerbate Therefore, we do not expect that the
locomotive and marine fuel was these concerns. However, depending on current proprietary rights regarding SY–
shipped by pipeline, the source material the outcome of the aforementioned CRC 124 are a significant concern.
for transmix processors fed by pipelines program, the addition of marker to Commenters also stated that our
that carry marked fuel could contain heating oil may hasten the current trend estimated cost of SY–124 in the NPRM
SY–124.180 Transmix processors stated to avoid the use of tank trucks to (0.2 cents per gallon of treated fuel) was
that it would be prohibitively expensive alternately transport jet fuel and heating high compared to other markers that
to segregate pipeline-generated transmix oil. To the extent that this does occur, cost hundredths of a cent per gallon.
containing the marker from that which we do not expect that it would result in Since the proposal we have obtained
does not contain the marker prior to substantial additional costs since few more accurate information which
processing, and that they could not tank truck operators currently use the indicates that the current cost of bulk
economically remove the marker during same tank truck compartments to quantities of SY–124 is approximately
reprocessing. Thus, in cases where the alternately transport heating oil and jet 0.03 cents per gallon of treated fuel (see
marker would be present in a transmix fuel. section VI.A.). Based on conversations
processor’s feed material, they would be Through our discussions with the IRS, with various marker manufacturers, this
limited to marketing their reprocessed we have confirmed that the presence of cost is comparable to or less than other
distillate fuels into the heating oil SY–124 will not interfere with fuel markers.
market. Since today’s final rule requires enforcement of their red dye F. Fuel Marker Test Method
that the marker be added at the terminal requirement. 181 Although, SY–124 may
As discussed in section V.E above,
gate (rather than at the refinery gate), the impart a slight orange tint to red-dyed
today’s rule requires the use of SY–124
feed material that transmix processors diesel fuel, this will not complicate the
at a concentration of 6mg/L in heating
receive from pipelines will not contain identification of the presence of the IRS
oil beginning in 2007, and in 500 ppm
the marker. Hence, they will not red dye. In fact, IRS has determined that
sulfur LM diesel fuel produced by a
typically need to process transmix the presence of SY–124 may even
refiner or importer from 2010 through
containing the fuel marker prescribed in enhance enforcement of their fuel tax
2012, except for such fuels that used in
today’s rule, and today’s marker program. 182 However, as identified in
the Northeast/Mid-Atlantic Area and
requirement is not expected to the comments, the implementation of
Alaska. There is currently no industry
significantly alter their operations. today’s marker requirement for heating standard test procedure to quantify the
There is little opportunity for marker oil arguably may be in conflict with IRS presence of SY–124 in distillate fuels.
contamination of fuels that are not regulations at 26 CFR 48.4082–1(b) The most commonly accepted method is
subject to the marker requirements to which state that no dye other than the based on the chemical extraction of the
occur at the terminal and further IRS-specified red dye must be present in SY–124 using hydrocloric acid solution
downstream. In the rare instances where untaxed diesel fuel. IRS is evaluating and cycloxane, and the subsequent
this might occur, the fuel contaminated what actions might be necessary to evaluation of the extract using a visual
would likely also be a distillate fuel, clarify that the addition of SY–124 to spectrometer to determine the
and thus could be sold into the heating heating oil would not be in violation of concentration of the marker.183 This test
oil market without need for IRS regulations. is inexpensive and easy to use for field
reprocessing. IRS also related that they are inspections. However, the test involves
investigating new markers for potential reagents that require some safety
179 Terminals that manufacture 500 ppm diesel use either to supplement or to replace precautions and the small amount of
fuel by blending 15 ppm and high sulfur fuel are red dye under their diesel tax program fuel required in the test must be
treated as a refiner under today’s rule. They must which might be compatible with jet fuel. disposed of as hazardous waste.
also comply with all applicable designate and track IRS stated that it might result in a
requirements, anti-downgrading provisions, and the Commenters expressed concerns about
other applicable requirements in today’s rule (see reduced burden on industry if EPA were
section IV.D of today’s preamble). 183 Memorandum to the docket entitled ‘‘Use of
180 We do not expect that there will be sufficient 181 Phone conversation between Carl Dalton and a Visible Spectrometer Based Test Method in
demand for 500 ppm sulfur LM diesel fuel Rick Stiff, IRS and Jeff Herzog and Paul Machiele, Detecting the Presence and Determining the
produced by refiners or importers to justify its EPA, February 19, 2004. Concentration of Solvent Yellow 124 in Diesel
shipment by pipeline after 2010. 182 ibid. Fuel.’’
the use of a test procedure which developed for SY–124 that can avoid the date of the European Union’s marker
involves a hazardous reagent use of reagents and the generation of requirement. However, EPA is aware of
(hydrochloric acid) and which generates hazardous waste that is by product of only limited summary data on the
a waste product that must be disposed the current commonly accepted method. variability of the reference test method
of as hazardous waste. Nevertheless, we Under the performance criteria from a manufacturer of the visible
continue to believe that such safety approach, methods developed by spectrometer apparatus used in the
concerns are manageable here in the consensus bodies as well as methods testing.186 The stated resolution of the
U.S. just as they are in Europe and that not yet approved by a consensus body test method from the materials provided
the small amount of waste generated can will qualify for approval provided they by this equipment manufacturer is 0.1
be handled along with other similar meet the specified performance criteria mg/L, with a repeatability of plus or
waste generated by the company as well as the record-keeping and minus 0.08 mg/L and a reproducibility
conducting the test, and that the reporting requirements for quality of plus or minus 0.2 mg/L.187 Given the
associated effort and costs will be control purposes. There is no designated lack of more extensive data, we have
negligible. marker test method. decided to use these available data as
Changes made in today’s final rule the basis of the precision and accuracy
1. How Can a Given Marker Test
from the proposal will mean that few criteria for the marker test procedure
Method Be Approved?
parties in industry will need to test for under today’s rule (as discussed below).
the marker, thereby minimizing A marker test method can be EPA may initiate a review of the
concerns about the burden of such approved for use under today’s program precision and accuracy criteria finalized
testing. Much of the testing for the fuel by meeting certain precision and in today’s rule should additional test
marker that was envisioned by industry accuracy criteria. Approval will apply data become available.
was associated with detecting marker on a laboratory/facility-specific basis. If Using a similar methodology to that
contamination in other fuels. By moving a company chooses to employ more employed in deriving the sulfur test
the required point of marker addition than one laboratory for fuel marker procedure precision value results in a
downstream to the terminal, today’s rule testing purposes, then each laboratory precision value for the marker test
virtually eliminates these concerns. will have to separately seek approval for procedure of 0.043 mg/L (see section
Where such concerns continue to exist, each method it intends to use. Likewise, V.H).188 However, we are concerned
the presence of the red dye will provide if a laboratory chooses to use more than that the use of this precision value,
a visual means of detecting marker one marker test method, then each because it is based on very limited data,
contamination.184 Therefore, we expect method will have to be approved might preclude the acceptability of test
that the instances where parties will separately. Separate approval will not procedures that would be adequate for
need to test for marker contamination be necessary for individual operators or the intended regulatory use. In addition,
will be rare. Also, the Northeast/Mid- laboratory instruments within a given the lowest measurement of marker
Atlantic Area provisions finalized in laboratory facility. The method will be concentration that will have relevance
today’s rule will exempt the vast approved for use by that laboratory as under the regulations is 0.1 mg per liter.
majority of heating oil used in the U.S. long as appropriate quality control Consequently, today’s rule requires that
from the marker requirement. Based on procedures were followed. the precision of a marker test procedure
the above discussion, we believe that In developing the precision and will need to be less than 0.1 mg/L for
the vast majority of testing for the accuracy criteria for the sulfur test it to qualify.
presence of the fuel marker that will be method, EPA drew upon the results of To demonstrate the accuracy of a
conducted will be that by EPA for an inter-laboratory study conducted by given test method, a laboratory facility
enforcement purposes. the American Society for Testing and will be required to perform 10 repeat
Similar to the approach proposed Materials (ASTM) to support ASTM’s tests, the mean of which can not deviate
regarding the measurement of fuel standardization of the sulfur test from the Accepted Reference Value
sulfur content discussed in section V.H method. Unfortunately, there has not (ARV) of the standard by more than 0.05
above, we are finalizing a performance- been sufficient time for industry to mg/L. We believe that this accuracy
based procedure to measure the standardize the test procedure used to level is not overly restrictive, while
concentration of SY–124 in distillate measure the concentration of SY–124 in being sufficiently protective considering
fuel. Section V.H above describes our distillate fuels or to conduct an inter- that the lowest marker level of
rationale for finalizing performance- laboratory study regarding the
based test procedures. Under the variability of the method. Nevertheless, 186 Technical Data on Fuel/Dye/Marker & Color
performance-based approach, a given the European Union has been successful Analyzers, as downloaded from the Petroleum
in implementing its marker requirement Analyzer Company L.P. Web site at http://
test method can be approved for use in www.petroleum-analyzer.com/product/PetroSpec/
a specific laboratory or for field testing while relying on the marker test lit_pspec/DTcolor.pdf.
by meeting certain precision and procedures which are currently 187 Repeatability and reproducibility are terms
accuracy criteria. Properly selected available, as noted above. We used, the related to test variability. ASTM defines
precision and accuracy values allow most commonly used marker test repeatability as the difference between successive
procedure to establish the precision and results obtained by the same operator with the same
multiple methods and multiple apparatus under constant operating conditions on
commercially available instruments to accuracy criteria on which a marker test identical test materials that would, in the long run,
be approved, thus providing greater procedure would be approved under the in the normal and correct operation of the test
flexibility in method and instrument today’s rule.185 method be exceeded only in one case in 20.
There has been substantial experience Reproducibility is defined by ASTM as the
selection while also encouraging the difference between two single and independent
development and use of better methods in the use of this reference market test results obtained by different operators working in
and instrumentation in the future. For method since the August 2002 effective different laboratories on identical material that
would, in the long run, be exceeded only in one
example, we are hopeful that with more 185 Memorandum to the docket entitled ‘‘Use of case in twenty.
time and effort a simpler test can be a Visible Spectrometer Based Test Method in 188 See section V.H of this proposal for a
Detecting the Presence and Determining the discussion of the methodology used in deriving the
184 Today’s rule requires that red dye be present Concentration of Solvent Yellow 124 in Diesel proposed precision and accuracy values for the
in heating oil which contains the marker. Fuel.’’ sulfur test method.
regulatory significance would be 0.1 method will be considered approved in by December 31, 2004 and shall include
mg/L. Ten tests will be required using the absence of EPA comment. the following information:
each of two different marker standards, Laboratory facilities are required to • The name and address of each
one in the range of 0.1 to 1 mg/L and retain the fuel samples used for location at which any employee of the
the other in the range of 4 to 10 mg/L precision and accuracy demonstration company, including any parent
of SY–124. Therefore, a minimum of 20 for 30 days. companies, subsidiaries, or joint venture
total tests will be required for sufficient For test methods that have not been partners 190 worked From January 1,
demonstration of accuracy for a given approved by a VCSB, full test method 2002 until January 1, 2003;
marker test method at a given laboratory documentation, including a description
facility. Finally, any known of the technology/instrumentation that • The average number of employees
interferences for a given test method makes the method functional, as well as at each location, based on the number
will have to be mitigated. These tests subsequent EPA approval of the method of employees for each of the company’s
must be performed using commercially is also required. These submissions are pay periods from January 1, 2002 until
available SY–124 standards. Since the subject to the Agency’s review for 90 January 1, 2003;
European Union’s marker requirement days, and the method will be considered • The type of business activities
will have been in effect for nearly 5 approved in the absence of EPA carried out at each location; and
years by the implementation date of comment. Submission of VCSB methods • The total crude oil refining capacity
today’s marker, we believe that such is not required since they are available of the corporation. We define total
standards will be available by the in the public domain. In addition, capacity as the sum of all individual
implementation date for today’s rule. industry and the Agency will likely refinery capacities for multiple-refinery
These requirements are not overly have had substantial experience with companies, including any and all
burdensome. To the contrary, these such methods. subsidiaries, and joint venture partners
requirements are equivalent to what a To assist the Agency in determining as reported to the Energy Information
laboratory would do during the normal the performance of a given marker test Administration (EIA) for 2002, or in the
start up procedure for a given test method (non-VCSB methods, in case of foreign refiners, a comparable
method. In addition, we believe the particular), we reserve the right to send reputable source, such as professional
performance based approach finalized samples of commercially available fuel publication or trade journal.191 Refiners
in today’s rule will allow regulated to laboratories for evaluation. Such do not need to include crude oil
entities to know that they are measuring samples are intended for situations in capacity used in 2002 through a lease
fuel marker levels accurately and within which the Agency has concerns agreement with another refiner in which
reasonable site reproducibility limits. regarding a test method and, in it has no ownership interest.
particular, its ability to measure the
2. What Information Would Have To Be marker content of a random The crude oil capacity information
Reported to the Agency? commercially available diesel fuel. reported to the EIA is presumed to be
As noted above, the European Union’s Laboratory facilities are required to correct. However, in cases where a
(EU) marker requirement will have been report the results from tests on this company disputes this information, we
in effect for nearly five years prior to the material to the Agency. will allow 60 days after the company
effective data for the proposed marker submits its application for small refiner
G. Requirements for Recordkeeping, status for that company to petition us
requirements and we expect the EU
Reporting, and PTDs with detailed data it believes shows that
requirement to continue indefinitely.
Thus, we anticipate that the European 1. Registration Requirements the EIA’s data was in error. We will
testings standards community will consider this data in making a final
As discussed in section IV.D, by determination about the refiner’s crude
likely have standardized a test December 31, 2005, or six months prior
procedure to measure the concentration oil capacity.
to handling fuels subject to the
of SY–124 in distillate fuels prior to the designation requirements of today’s Finally, applications for small refiner
implementation of the marker rule, each entity in the fuel distribution status must also include information on
requirement in today’s final rule. The system, up through and including the which small refiner option the refiner
United States testing standards point where fuel is loaded onto trucks expects to use at each of its refineries.
community may also enact such a for distribution to retailers or wholesale 3. Applications for Refiner Hardship
standardized test procedure. To the purchaser-consumers, must register Relief
extent that marker test methods that each of its facilities with EPA.
have already been approved by a An entity’s registration must include As discussed above in section IV.C, a
voluntary consensus standards body 189 the following information: refiner seeking general hardship relief
(VCSB), such as the International • Corporate name and address under today’s program will apply to
Standards Organization (ISO) or the —Contact name, telephone number, and EPA and provide several types of
American Society for Testing and e-mail address financial and technical information,
Materials (ASTM), each laboratory such as internal cash flow data and
• For each facility operated by the
facility would be required to report to information on bank loans, bonds, and
entity:
the Agency the precision and accuracy assets as well as detailed engineering
results as described above for each —Type of facility (e.g. refinery, import
and construction plans and permit
method for which it is seeking approval. facility, pipeline, terminal)
status. Applications for general
Such submissions to EPA, as described —Facility name
—Physical location hardship relief are due June 1, 2005.
elsewhere, will be subject to the —Contact name, telephone number, and
Agency’s review for 30 days, and the e-mail address 190 ‘‘Subsidiary’’ here covers entities of which the
parent company has 50 percent or greater

189 These are standard-setting organizations, like
2. Applications for Small Refiner Status ownership.
ASTM, and ISO that have broad representation of 191 We will evaluate each foreign refiner?s
all interested stakeholders and make decisions by An application of a refiner for small documentation of crude oil capacity on an
consensus. refiner status must be submitted to EPA individual basis.
4. Pre-Compliance Reports for Refiners numbers of credits to be earned and/or reported over the quarterly compliance
used; period;
We believe that an early general • Information on project schedule by • Calculations showing that the
understanding of the refining industry’s known or projected completion date (by volume of highway diesel fuel
progress in complying with the quarter) by the stage of the project. For distributed from the facility relative to
requirements in today’s rule will be example, following the five project the volume received did not increase
valuable to both the industry and EPA. phases described in EPA’s June 2002 since June 1, 2007; and
As with the highway diesel program, we Highway Diesel Progress Review report
are requiring that each refiner and • Calculations showing that the
(EPA420–R–02–016): (1) Strategic volume of high sulfur NRLM diesel fuel
importer provide annual reports on the planning, (2) planning and front-end
progress of compliance and plans for did not increase by a greater proportion
engineering, (3) detailed engineering than the volume of heating oil over the
compliance for each of their refineries and permitting, (4) procurement and
or import facilities. These pre- quarterly compliance period (not
construction, and (5) commissioning applicable in the Northeast/Mid-
compliance reports are due June 1 of and startup.
each year beginning in 2005 and Atlantic Area or Alaska).
• Basic information regarding the
continuing through 2011, or until the The quarterly compliance periods and
selected technology pathway for
production of 15 ppm sulfur NR and LM dates by which the reports are due for
compliance (e.g., conventional
diesel fuel commences, whichever is each period are as follows.
hydrotreating vs other technologies,
later. revamp vs grassroots, etc.);
EPA will maintain the confidentiality • Whether capital commitments have TABLE V.G–1. Q UARTERLY COMPLI-
of information submitted in pre- been made or are projected to be made; ANCE PERIODS AND REPORTING
compliance reports to the full extent and DATES a
authorized by law. We will report • The pre-compliance reports in 2006
generalized summaries of this data and later years must provide an update Quarterly compliance pe- Report due date
of the progress in each of these areas. riod
following receipt of the pre-compliance
reports. We recognize that plans may 5. Compliance Reports for Refiners, July 1 through September November 30.
change for many refiners or importers as Importers, and Distributors of 30.
the compliance dates approach. Thus, Designated Diesel Fuel October 1 though Decem- February 28.
submission of the reports will not ber 31.
impose an obligation to follow through a. Designate and Track Reporting January 1 through March May 31.
on plans projected in the reports. Requirements 31.
April 1 through June 30 ..... August 31.
Pre-compliance reports can, at the i. Quarterly Reports
discretion of the refiner/importer, be From June 1, 2007 and through Notes: a The first quarterly reporting period
submitted in conjunction with the will be from June 1, 2007 though September
September 1, 2010, all entities who are 30, 2007 and the last quarterly compliance pe-
annual compliance reports discussed required to maintain records must riod will be from April 1, 2010 through May 31,
below and/or the pre-compliance and report the following information by 2010.
annual compliance reports required facility to EPA on a quarterly basis: ii. Annual Reports
under the highway diesel program, as • The total volume in gallons of each
long as all of the information that is type of designated diesel fuel for which Beginning June 1, 2007, all entities
required in all reports is clearly custody was transferred by the entity to that are required to maintain records for
provided. Based on experience with the any other entity, and the EPA entity and batches of fuel must report by facility on
first pre-compliance reports for the facility identification number(s), as an annual basis (due August 31)
highway diesel program, we are applicable, of the transferee; and information on the total volumes
clarifying the information request for • The total volume in gallons of each received of each fuel designation as well
the pre-compliance reports as shown type of designated diesel fuel for which as the results of all compliance
below. This should provide responses in custody was received by the entity from calculations including the following:
a more standardized format which will any other entity and the EPA entity and • The total volumes transferred of
allow for better aggregation of the data, facility identification number(s), as each fuel designation;
as well as eliminate reporting of applicable, of the transferor. • Beginning and ending inventories
unnecessary information. If a facility receives fuel from another of each fuel designation;
Pre-compliance reports must include facility that does not have an EPA
• In Alaska, for diesel fuel designated
the following information: facility identification number then that
as high sulfur NRLM delivered from
• Any changes in the basic corporate batch of fuel must be designated and
June 1, 2007 through May 31, 2010 and
or facility information since registration; reported as (1) heating oil if it is
for diesel fuel designated as 500 ppm
marked, (2) highway diesel fuel if taxes
• Estimates of the average daily sulfur NRLM delivered from June 1,
have been assessed, (3) NRLM diesel
volumes (in gallons) of each sulfur grade 2010 through May 31, 2014, refiners
fuel if the fuel is dyed but not marked.
of highway and NRLM diesel fuel Terminals must also report the results must report all information required
produced (or imported) at each refinery of all compliance calculations including under their individual compliance plan,
(or facility). These volume estimates the following: including the end-users to whom each
must be provided both for fuel produced • The total volumes received of each batch of fuel was delivered and the total
from crude oil, as well as any fuel fuel designation required to be reported delivered to each end-user for the
produced from other sources, and must over the quarterly compliance period; compliance period;
be provided for the periods of June 1, • The total volumes transferred of • Ending with the report due August
2010–December 31, 2010, calendar years each fuel designation required to be 31, 2010, calculations showing that the
2011–13, January 1, 2014–May 31, 2014, reported over the quarterly compliance volume of highway diesel fuel
and June 1, 2014–December 31, 2014; period; distributed from the facility relative to
• For entities expecting to participate • Beginning and ending inventories the volume received did not increase
in the credit program, estimates of of each fuel designation required to be since June 1, 2007;
• Ending with the report due August credits. Credit transfer information must track transfers are somewhat more
31, 2010, calculations showing that the include the identification of the number straightforward.
volume of highway diesel fuel of credits obtained from, or transferred We believe this additional
distributed from the facility relative to to, each entity. Reports must also show information on commercial PTDs is
new volume received did not increase the credit balance at the start of the necessary to maintain the integrity of
over the annual compliance period by period, and the balance at the end of the the various grades of diesel fuel in the
more than two percent of the total period. NRLM or nonroad diesel sulfur distribution system. Parties in the
volume of highway diesel fuel received; credit information is required to be system will be better able to identify
• Ending with the report due August stated separately from highway diesel which type of fuel they are dealing with
31, 2010, calculations showing that the credit information since the two credit and more effectively ensure that they
volume of high sulfur NRLM diesel fuel programs are treated separately. are meeting the requirements of today’s
did not increase by a greater proportion • For a small refiner that elects to program. This in turn will help to
than the volume of heating oil over the produce 15 ppm sulfur NRLM diesel ensure that misfueling of sulfur
annual compliance period (not fuel by June 1, 2006 and therefore is sensitive engines does not occur and
applicable in the Northeast/Mid- eligible for a limited relaxation in its that the program results in the needed
Atlantic Area or Alaska); interim small refiner gasoline sulfur emission reductions.
• Calculations showing that the standards, the annual reports must also Today’s rule allows the use of product
volume of heating oil did not decrease include specific information on gasoline codes to convey the required
over the annual compliance period, sulfur levels and progress toward information, except for transfers to truck
beginning June 1, 2010 (not applicable highway and NRLM diesel fuel carriers, retailers and wholesale
in the Northeast/Mid-Atlantic Area or desulfurization. purchaser-consumers. We believe that
Alaska); and more explicit language on PTDs to these
• From June 1, 2010 through August 6. PTDs parties is necessary since employees of
1, 2012, calculations showing that the Refiners, importers, and other parties such parties are less likely to be aware
volume of 500 ppm sulfur NR diesel in the distribution system must provide of the meaning of product codes. PTDs
fuel did not increase by a greater information on commercial PTDs that will not be required for transfers of
proportion than the volume of 500 ppm identify diesel fuel distributed by use product into nonroad, locomotive, or
sulfur LM diesel fuel over the annual designation and sulfur content; i.e., for marine equipment at retail outlets or
compliance period (not applicable in use in or motor vehicles, nonroad wholesale purchaser-consumer facilities
the Northeast/Mid-Atlantic Area and equipment, locomotive and marine with the exception of mobile refuelers.
Alaska. equipment, or nonroad, locomotive, and Mobile refuellers are required to provide
marine diesel equipment, as a separate PTD to their customers for
b. Other Reporting Requirements appropriate, and the sulfur standard to each type of fuel (e.g., 500 ppm sulfur
After the NRLM diesel fuel sulfur which the fuel is subject. The PTD must NRLM diesel fuel, 15 ppm sulfur NRLM
requirements begin on June 1, 2007, indicate whether the fuel is diesel fuel, diesel fuel, or 15 ppm highway diesel
refiners and importers will be required heating oil, kerosene, exempt fuel, or fuel) that they dispense from tanker
to submit annual compliance reports for other. It must further state whether it is trucks or other vessels into motor
each refinery or import facility. If a No. 1 or No. 2, dyed or undyed, marked vehicles, nonroad diesel engines or
refiner produces 15 ppm sulfur or 500 heating oil, marked LM fuel, or nonroad diesel engine equipment, for
ppm sulfur fuel early under the credit unmarked. The specific designations on each instance when they refuel such
provisions, its annual compliance PTDs will change during the course of equipment at a given location.192
reporting requirement will begin on the program. For example, the highway
designation for 500 ppm sulfur fuel a. Kerosene and Other Distillates To
June 1 following the beginning of the
ends after 2010. Where a party delivers Reduce Viscosity
early fuel production. These reporting
requirements will sunset after all or receives a particular load of fuel that To ensure that downstream parties
flexibility provisions end (i.e., after May has a uniform sulfur content but that can determine the sulfur level of
31, 2014). Annual compliance reports has two different designations, the kerosene or other distillates that may be
will be due on August 31. parties must utilize two different PTDs. distributed for use for blending into 15
A refiner’s or importer’s annual For example, if, in 2007 a refiner moves ppm sulfur highway or NRLM diesel
compliance report must include the 1,000 gallons of 500 ppm sulfur diesel fuel, for example, to reduce viscosity in
following information for each of its into a pipeline, and the refiner’s cold weather, we are requiring that
facilities: designation is that half of that product PTDs identify distillates specifically
• Batch reports for each batch is highway 500 and half is nonroad 500, distributed for such use as meeting the
produced or imported providing the parties would utilize one PTD for 15 ppm sulfur standard.
information regarding volume, 500 gallons of highway 500 ppm sulfur b. Exported Fuel
designation (e.g., 500 highway), sulfur diesel fuel and another for 500 gallons
level and whether the fuel was dyed of nonroad 500 diesel fuel. Consistent with other EPA fuel
and/or marked. Each batch can only As in other fuels programs, PTDs programs, NRLM diesel fuel exported
have one designation. Therefore, if a must accompany each transfer of either from the U.S. is not required to meet the
refiner ships 100 gallons of 500 ppm title or custody of fuel. However, only sulfur standards of today’s regulations.
sulfur fuel in 2007 and wants to custody transfers are relevant to For example, where a refiner designates
designate 50 gallons as highway 500 and compliance with the designation and a batch of diesel fuel for export, and can
50 gallons as NR 500, the refiner must tracking requirements and the demonstrate through commercial
report two separate batches and there downgrade limitations, and transfers to documents that the fuel was exported,
must be two PTDs—one for 50 gallons retail outlets and wholesale purchaser- such fuel would not be required to
of highway 500 and one for 50 gallons consumers of fuel by distributors below 192 Only one PTD is required for each fuel
of NR 500). the truck rack are not covered by the designation or classification regardless of the
• Report on the generation, use, designate and track scheme. Therefore, number of motor vehicles or the number of diesel-
transfer and retirement of diesel sulfur the PTDs for these non-designate and powered NRLM equipment that are fueled.
comply with the NRLM sulfur standards described below for the various periods • 15 ppm sulfur NRLM diesel fuel;
in today’s rule. Product transfer of the program.193 • No. 1 500 ppm sulfur highway
documents accompanying the transfer of • Batch number (including whether it diesel fuel;
custody of the fuel at each point in the is an incoming or out-going batch for • No. 2 500 ppm sulfur highway
distribution system are required to state refineries that also handle previously diesel fuel; or
that the fuel is for export only and may designated fuel); • 500 ppm sulfur NRLM diesel fuel.
not be used in the United States. • Batch designation;
• Volume in gallons; b. June 1, 2007 Through May 31, 2010
c. Additives • Date/time of day of custody Refiners and importers must maintain
transfer; and the records listed above for each batch
Today’s rule requires that PTDs for • Name and EPA entity and facility of distillate fuel that they designate and
additives for use in NRLM diesel fuel identification number of the facility to transfer custody of during the time
state whether the additive complies which the batch was transferred. period from June 1, 2007 through May
with the 15 ppm sulfur standard. Like For highway diesel fuel, the records 31, 2010 with the following fuel types:
the highway diesel rule, this program must also identify whether the batch • No. 1 15 ppm sulfur highway diesel
allows the sale of additives, for use by was received or delivered with or fuel;
fuel terminals or other parties in the without taxes assessed. For NRLM • No. 2 15 ppm sulfur highway diesel
diesel fuel distribution system, that diesel fuel, the records must also fuel;
have a sulfur content greater than 15 identify whether the batch was received • 15 ppm sulfur NRLM diesel fuel;
ppm under specified conditions. or delivered with or without the IRS red • No. 1 500 ppm sulfur highway
dye. For heating oil, the records must diesel fuel;
For additives that have a sulfur
indicate whether the batch was received • No. 2 500 ppm sulfur highway
content less than 15 ppm, the PTD must or delivered with or without the fuel
state: ‘‘The sulfur content of this diesel fuel; or
marker. From June 1, 2010, through May • 500 ppm sulfur NRLM diesel fuel;
additive does not exceed 15 ppm.’’ For 31, 2012, the records for LM fuel
additives that have a sulfur content • High sulfur NRLM diesel fuel; or
batches must also indicate whether the • Heating oil.
greater than 15 ppm, the additive batch was received or delivered with or
manufacturer’s PTD, and PTDs without the fuel marker. c. June 1, 2010 Through May 31, 2012
accompanying all subsequent transfers, In addition to the designate and track
must provide a warning that the Refiners and importers must maintain
records, refiners and importers must the records listed above for each batch
additive’s sulfur content exceeds 15 maintain the following records on the of diesel fuel that they designate and
ppm; the maximum sulfur content of the highway and NRLM diesel fuel that they transfer custody of during the time
additive; the maximum recommended produce and/or import: period from June 1, 2010 through May
concentration for use of the additive in • PTDs;
• Sampling and testing results for 31, 2012, with the following fuel types:
diesel fuel (stated as gallon of additive
sulfur content (for highway and NRLM • 500 ppm sulfur NR diesel fuel;
per gallon of diesel fuel); and the
diesel fuel that is subject to either the • 500 ppm sulfur LM diesel fuel; or
increase in sulfur concentration of the
15 ppm or 500 ppm sulfur standards), • Heating oil.
fuel the additive will cause when used
at the maximum recommended as well as sampling and testing results d. June 1, 2012 Through May 31, 2014
concentration. that are part of a quality assurance
Refiners and importers must maintain
program;
Today’s rule contains provisions for • Sampling and testing results for the the records listed above for each batch
aftermarket additives sold to owner/ cetane index or aromatics content, as of distillate fuel that they transfer
operators for use in diesel powered well as sampling and testing results for custody of and designate during the
nonroad equipment. These provisions additives; time period from June 1, 2012 through
are in response to concerns that • Records on credit generation, use, May 31, 2014 with the following fuel
additives designed for engines not transfer, purchase, or termination, types:
requiring 15 ppm sulfur fuel, such as maintained separately for the highway • 15 ppm sulfur highway or NRLM
locomotive or marine engines, could and NRLM diesel fuel credit programs; diesel fuel;
accidentally be introduced into nonroad and • 500 ppm sulfur NRLM diesel fuel;
engines if they had no label stating • Records related to individual or
appropriate use. Beginning June 1, 2010, compliance plans, if applicable, and • Heating oil.
aftermarket additives for use in nonroad annual compliance calculations. d. June 1, 2014 and Beyond
equipment must be accompanied by
a. June 1, 2006 through May 31, 2007 Refiners and importers must maintain
information that states that the additive
complies with the 15 ppm sulfur Refiners and importers must maintain the records listed above for each batch
standard. We believe this information is the records listed above for each batch of heating oil that they transfer custody
necessary for end users to determine if of diesel fuel that they designate and of and designate during the time period
an additive is appropriate for use. transfer custody of during the time from June 1, 2014 and beyond.
period from June 1, 2006 through May 8. Recordkeeping Requirements for
7. Recordkeeping Requirements for 31, 2007, with the following fuel types: Distributors
Refiners and Importers • No. 1 15 ppm sulfur highway diesel
fuel; Distributors of distillate fuel must
Refiners and importers of distillate • No. 2 15 ppm sulfur highway diesel maintain the following designate and
fuel must maintain the following fuel; track records on a facility-specific basis
designate and track records for the for the distillate fuel they distribute.
distillate fuel they produce and/or 193 Transmix processors and terminal operators
The specific distillate fuel designations
import. The specific types of distillate acting as refiners that produce 500 ppm sulfur that are subject to these recordkeeping
diesel fuel for sale into the locomotive and marine
fuel that are subject to these markets are also subject to the recordkeeping requirements are described below for
recordkeeping requirements are requirements. the various periods of the program.
• Batch number (including whether it records. Similarly, if a facility only period from June 1, 2012 through May
is an incoming or out-going batch); receives highway diesel fuel on which 31, 2014. This requirement does not
• Batch designation; taxes have been assessed or NRLM apply to facilities located in Alaska or
• Volume in gallons; diesel fuel which has been dyed the Northeast/Mid-Atlantic Area unless
• Date/time of day of custody pursuant to IRS regulations (i.e., it does they deliver marked heating oil to
transfer; not receive any untaxed highway diesel facilities outside of these areas.
• Name and EPA entity and facility fuel or undyed NRLM diesel fuel), then • 500 ppm sulfur NRLM diesel fuel;
identification number of the facility it does not need to maintain records of and
from which the fuel batch was received the 500 ppm sulfur highway or NRLM • Heating oil.
or to which the fuel batch was diesel fuel that it receives.
delivered; 9. Recordkeeping Requirements for End-
• Beginning and ending inventory a. June 1, 2006 Through May 31, 2007 Users
volumes on a quarterly basis; and Facilities that receive No. 2 15 ppm
• Inventory adjustments. Today’s program also contains certain
sulfur highway diesel fuel and recordkeeping provisions for end-users.
For highway diesel fuel, the records
distribute any No. 2 500 ppm sulfur From June 1, 2007 through October 1,
must also identify whether the batch
highway diesel fuel, must maintain 2010, end-users that receive any batch
was received or delivered with or
records for each batch of diesel fuel of high sulfur NRLM in Alaska must
without taxes assessed. For NRLM
with the following designations that maintain records of each batch of fuel
diesel fuel, the records must also
they receive or deliver during the time received for use in NRLM equipment
identify whether the batch was received
period from June 1, 2006 through May unless otherwise allowed by EPA. From
or delivered with or without the IRS red
31, 2007: June 1, 2010 through October 1, 2012,
dye. For heating oil, the records must • No. 1 15 ppm sulfur highway diesel
indicate whether the batch was received end-users that receive any batch of 500
fuel; ppm sulfur NR in Alaska must maintain
or delivered with or without the fuel • No. 2 15 ppm sulfur highway diesel
marker. From June 1, 2010, through records of each batch of fuel received for
fuel; use in NR equipment unless otherwise
October 1, 2012, the records must • No. 2 500 ppm sulfur highway
indicate whether LM fuel was received allowed by EPA. In addition, from June
diesel fuel; and 1, 2012 through October 1, 2014, end-
or delivered with or without the fuel • 500 ppm sulfur NRLM diesel fuel.
marker.194 In addition to these designate users that receive any batch of 500 ppm
and track records, distributors will be b. June 1, 2007 Through May 31, 2010 sulfur NRLM in Alaska must maintain
required to maintain records related to records of each batch of fuel received for
All facilities must maintain records use in NRLM equipment unless
their quarterly and annual compliance for each batch of diesel fuel or heating
calculations as well as copies of all otherwise allowed by EPA.
oil with the following designations for
PTDs. which they receive or transfer custody 10. Record Retention
If a facility receives fuel from another during the time period from June 1,
facility that does not have an EPA We are adopting a retention period of
2007 through May 31, 2010: five years for all records required to be
facility identification number then that • No. 1 15 ppm sulfur highway diesel
batch of fuel must be designated as (1) kept under today’s rule. This is the same
fuel; period of time required in other fuels
heating oil if it is marked, or from 2010 • No. 2 15 ppm sulfur highway diesel
through 2012, LM diesel fuel if the fuel rules, and it coincides with the
fuel;
is dyed and marked and is not heating applicable statute of limitations. We
• No. 1 500 ppm sulfur highway
oil (2) highway diesel fuel if taxes have believe that most parties in the
diesel fuel;
been assessed, and (3) NRLM diesel fuel distribution system would maintain
• No. 2 500 ppm sulfur highway
if the fuel is dyed but not marked. some or all of these records for this
diesel fuel;
If a facility delivers fuel to other length of time even without the
• 500 ppm sulfur NRLM diesel fuel;
facilities and that fuel is either 500 ppm requirement.
• 15 ppm sulfur NRLM diesel fuel;
sulfur highway diesel fuel on which • High sulfur NRLM diesel fuel; and This retention period applies to PTDs,
taxes have been assessed or 500 ppm • Heating oil. records required under the designate
sulfur NRLM, or LM diesel fuel into and track provisions, records of any test
which red dye has been added pursuant c. June 1, 2010 Through May 31, 2012 results performed by any regulated party
to IRS requirements, then the facility All facilities must maintain records for quality assurance purposes or
does not need to maintain separate for each batch of diesel fuel or heating otherwise (whether or not such testing
records for each of the other facilities to oil with the following designations for was required by this rule), along with
which it delivered fuel. Similarly, if a which they receive or transfer custody supporting documentation such as date
facility delivers batches of marked during the time period from June 1, of sampling and testing, batch number,
heating oil to other facilities, then it 2007 through May 31, 2012. This tank number, and volume of product.
does not need to maintain separate requirement does not apply to facilities Business records regarding actions taken
records for each of the other facilities to located in the Northeast/Mid-Atlantic in response to any violations discovered
which it delivered the marked heating Area or Alaska. must also be maintained for five years.
oil. If a facility only receives marked • 500 ppm sulfur NR diesel fuel; All records that are required to be
heating oil (i.e., it does not receive any • 500 ppm sulfur LM diesel fuel; or maintained by refiners or importers
unmarked heating oil), then it does not • Heating oil. participating in the generation or use of
need to maintain any heating oil credits, hardship options (or by
d. June 1, 2012 Through May 31, 2014 importers of diesel fuel produced by a
194 AfterAugust 1, 2012, LM fuel distributed from Facilities that receive unmarked fuel foreign refiner approved for the
terminals must contain a concentration of the designated as heating oil, must maintain temporary compliance option or a
marker no greater than 0.1 mg/L. After October 1,
2012, LM fuel at any location in the fuel
records for each batch of diesel fuel hardship option), including small
distribution system must contain no more than a with the following designations that refiner options, are also covered by the
trace amount of the marker (0.1 mg/L). they receive or deliver during the time retention period.
H. Liability and Penalty Provisions for when NRLM would otherwise be liability are rebuttable. In general, in
Noncompliance required to meet a 500 ppm sulfur order to rebut the presumption of
standard, and can produce 500 ppm liability, parties will be required to
1. General
sulfur NR or LM diesel fuel when establish that: (1) The party did not
The liability and penalty provisions of nonroad or LM diesel fuel would cause the violation; (2) PTD(s) exist
the today’s NRLM diesel sulfur rule are otherwise be required to meet a 15 ppm which establish that the fuel or diesel
very similar to the liability and penalty sulfur standard. A refiner that produces additive was in compliance while under
provisions found in the highway diesel fuel under the small refiner and credit the party’s control; and (3) the party
sulfur rule, the gasoline sulfur rule, the provisions would be in violation unless conducted a quality assurance sampling
reformulated gasoline rule and other they can demonstrate that they meet the and testing program. As part of their
EPA fuels regulations.195 Regulated definition of a small refiner or have affirmative defense diesel fuel refiners
parties are subject to prohibitions which sufficient credits for the volume of fuel or importers, diesel fuel additive
are typical in EPA fuels regulations, produced. All regulated parties will be manufacturers, and blenders of high
such as prohibitions on selling or liable for a failure to meet certain sulfur additives into diesel fuel, will
distributing fuel that does not comply requirements, such as the record- also be required to provide test results
with the applicable standard, and keeping, reporting, or PTD establishing the conformity of the
causing others to commit prohibited requirements, or causing others to fail to product prior to leaving that party’s
acts. For example, liability will also meet such requirements. control. Blenders of static dissipater
arise under the NRLM diesel rule for Under today’s rule, the party in the additives have alternative defense
violating certain prohibited acts and diesel fuel distribution system that provisions as discussed in section V.C.
requirements, such as: Distributing or controls the facility where a violation Branded refiners have additional
dispensing NR diesel fuel not meeting occurred, and other parties in that fuel affirmative defense elements to
the 15 ppm sulfur standard for use in distribution system (such as the refiner, establish. The defenses under the
model year 2011 or later nonroad reseller, and distributor), will be nonroad diesel sulfur rule are similar to
equipment (and after Dec 1, 2014 into presumed to be liable for the those available to parties for violations
any nonroad diesel equipment); violation.197 As in the Tier 2 gasoline of the highway diesel sulfur,
distributing or dispensing diesel fuel sulfur rule and the highway diesel fuel reformulated gasoline, gasoline
not meeting the 500 ppm sulfur rule, today’s rule explicitly prohibits volatility, and the gasoline sulfur
standard for locomotive and marine causing another person to commit a regulations. Today’s rule also clarifies
engines; distributing fuel containing the prohibited act or causing non- that parent corporations are liable for
marker for use in engines that require conforming diesel fuel to be in the violations of subsidiaries, in a manner
the use of fuel that does not contain the distribution system. Non-conforming consistent with the gasoline sulfur rule
marker; prohibitions and requirements fuels include: (1) Diesel fuel with sulfur and the highway diesel sulfur rule.
under the designate and track content above 15 ppm incorrectly Finally, the NRLM diesel sulfur rule
provisions in today’s rule, including represented as appropriate for model mirrors the gasoline sulfur rule and the
specific prohibitions and requirements year 2011 or later nonroad equipment or highway diesel sulfur rule by clarifying
regarding fuel produced or distributed other engines requiring 15 ppm fuel; (2) that each partner to a joint venture will
in the Northeast/Mid-Atlantic Area or in diesel fuel with sulfur content above be jointly and severally liable for the
Alaska.196 500 ppm incorrectly represented as violations at the joint venture facility or
Small refiners and refiners using appropriate for nonroad equipment or by the joint venture operation.
credits can produce high sulfur NRLM locomotives or marine engines after the As is the case with the other EPA
applicable date for the 500 ppm sulfur fuels regulations, today’s rule will apply
195 See section 80.5 (penalties for fuels
standard for these pieces of equipment; the provisions of section 211(d)(1) of the
violations); section 80.23 (liability for lead
violations); section 80.28 (liability for gasoline
(3) heating oil that is required to contain Clean Air Act (Act) for the collection of
volatility violations); section 80.30 (liability for the marker which does not, LM fuel penalties. These penalty provisions
highway diesel violations); section 80.79 (liability which is required to contain the marker currently subject any person that
for violation of RFG prohibited acts); section 80.80 which does not, or other fuels that are violates any requirement or prohibition
(penalties for RFG/CG violations); section 80.395
(liability for gasoline sulfur violations); section
required to be free of the marker in of the diesel sulfur rule to a civil
80.405 (penalties for gasoline sulfur regulations).; which the marker is present; (4) fuel penalty of up to $32,500 for every day
and section 80.610–614 (prohibited acts, liability designated or labeled as 500 ppm sulfur of each such violation and the amount
for violations, and penalties for highway diesel highway diesel fuel above and beyond of economic benefit or savings resulting
sulfur regulations.
196 Today’s rule, in 40 CFR 80.610, provides that
the volume balance limitations; (5) fuel from the violation.198 A violation of a
no person shall, inter alia, ‘‘dispense, supply, offer designated or labeled as NRLM above NRLM diesel sulfur standard will
for supply, store or transport * * *’’ fuel not in and beyond the volume balance constitute a separate day of violation for
compliance with applicable standards and limitations; or (6) fuels otherwise not each day the diesel fuel giving rise to
requirements starting on a certain date. These complying with the requirements of this the violation remains in the fuel
prohibitions apply at downstream locations such as
retail outlets, wholesale purchaser-consumer rule. Parties outside the diesel fuel distribution system. Under today’s
facilities as well as end-user locations. The act of distribution system, such as diesel regulation, the length of time the diesel
storage or transport refers to storage or transport in additive manufacturers and distributors, fuel in question remains in the
fuel storage tanks from which fuel is dispensed into are also subject to liability for those distribution system is deemed to be
motor vehicles or NRLM engines or equipment. It
does not refer to storing or transporting the fuel that diesel rule violations which could have twenty-five days unless there is
is in the motor vehicle propulsion tank or other been caused by their conduct. evidence that the fuel remained in its
tank that is incorporated in the NRLM equipment Today’s rule also provides affirmative distribution system a lesser or greater
for the purpose of supplying the engine with fuel. defenses for each party presumed liable amount of time. This is the same time
While the prohibition against dispensing
inappropriate fuels does apply as of the applicable for a violation, and all presumptions of presumption that is incorporated in the
date, the motor vehicle or NRLM engine or
equipment may continue to burn any fuel in the 197 An additional type of liability, vicarious 198 This limit is amended periodically pursuant to
motor vehicle fuel tank or NRLM equipment fuel liability, is also imposed on branded refiners under Congressional authority to change maximum civil
tank that was properly dispensed into such tank. today’s rule. penalties to account for inflation.
RFG, gasoline sulfur and highway diesel recognizing that party should primarily today’s rule imposes presumptive
sulfur rules. The penalty provisions in be liable for penalties for the violation. liability on parties in the additive
today rule are also be similar to the distribution system if diesel fuel into
2. What are the Liability Provisions for
penalty provisions for violations of which the additive has been blended is
Additive Manufacturers and
these regulations. determined to have a sulfur level in
Distributors, and Parties That Blend excess of its permitted concentration.
EPA has included in today’s rule two
Additives into Diesel Fuel? This presumptive liability will differ
prohibitions for ‘‘causing’’ violations:
(1) Causing another to commit a a. General depending on whether the blended
violation; and (2) causing non- The final highway diesel rule permits additive was designated as meeting the
complying diesel fuel to be in the the blending of diesel fuel additives 15 ppm sulfur standard (a ‘‘15 ppm
distribution system. These causation with sulfur content in excess of 15 ppm additive’’) or designated as a greater
prohibitions are like similar into 15 ppm highway diesel fuel under than 15 ppm sulfur additive (a ‘‘high
prohibitions included in the gasoline limited circumstances. As more fully sulfur additive’’), as discussed below.
sulfur and the highway diesel sulfur discussed earlier in this preamble, this b. Liability When the Additive Is
regulations, and, as discussed in the rule also permits downstream parties to Designated as Complying with the 15
preamble to those rules, EPA believes blend fuel additives having a sulfur ppm Sulfur Standard
they are consistent with EPA’s content exceeding 15 ppm into 15 ppm
implementation of prior motor vehicle Additives blended into diesel fuel
nonroad diesel, provided that: (1) The downstream of the refinery are required
fuel regulations. See the liability blending of the additive does not cause
discussion in the preamble to the to have a sulfur content no greater than
the diesel fuel’s sulfur content to exceed 15 ppm, and be accompanied by PTD(s)
gasoline sulfur final rule, at 65 FR 6812 the 15 ppm sulfur standard; (2) the
et seq. accurately identifying them as
additive is added in an amount no complying with the 15 ppm sulfur
The prohibition against causing greater than one volume percent of the
another to commit a violation will apply standard, with the sole exception of
blended product; and (3) the diesel additives blended into nonroad
where one party’s violation is caused by downstream party obtained from its
the actions of another party. For diesel fuel at a concentration no greater
additive supplier a product transfer than one percent by volume of the
example, EPA may conduct an document (‘‘PTD’’) with the additive’s
inspection of a terminal and discover blended fuel.
sulfur content and the recommended All parties in the fuel and additive
that the terminal is offering for sale treatment rate, and that it complied with distribution systems will be subject to
nonroad diesel fuel designated as such treatment rate. As discussed in presumptive liability if the blended fuel
complying with the 15 ppm sulfur section V.C, today’s rule includes exceeds the sulfur standard. The two
standard, while the fuel, in fact, had an alternate affirmative defense ppm downstream adjustment will apply
actual sulfur content greater than the requirements for blenders of S–D when EPA tests the fuel subject to the
standard.199 In this scenario, parties in additives that can contribute a 15 ppm sulfur standard. Low sulfur
the fuel distribution system, as well as maximum of 0.050 ppm to the sulfur additives present a less significant
parties in the distribution system of any content of finished fuel subject to the 15 threat to diesel fuel sulfur compliance
diesel additive that had been blended ppm sulfur standard. Today’s rule also than would occur with the use of
into the fuel, will be presumed liable for implements these same alternate additives designated as possibly
causing the terminal to be in violation. defense requirements regarding the exceeding 15 ppm sulfur. Thus, parties
Each party will have the right to present blending of such additives into 15 ppm in the additive distribution system of
an affirmative defense to rebut this highway diesel fuel. the low sulfur additive could rebut the
presumption. Since today’s rule permits the limited presumption of liability by showing the
The prohibition against causing non- use in nonroad diesel fuel of additives following: (1) Additive distributors will
compliant diesel fuel to be in the with high sulfur content, the Agency only be required to produce PTDs
distribution system will apply, for believes it might be more likely that a stating that the additive complies with
example, if a refiner transfers non- diesel fuel sulfur violation could be the 15 ppm sulfur standard; (2) additive
compliant diesel fuel to a pipeline. This caused by the use of high sulfur manufacturers are also be required to
prohibition could encompass situations additives. This could result from the produce PTDs accurately indicating
where evidence shows high sulfur additive manufacturer’s compliance with the regulatory
diesel fuel was transferred from an misrepresentation or inaccurate requirements, as well as producing test
upstream party in the distribution statement of the additive’s sulfur results, or retained samples on which
system, but EPA may not have test content or recommended treat rate on tests could be run, establishing the
results to establish that parties the additive’s PTD, or an additive additive’s compliance with the 15 ppm
downstream also violated a prohibited distributor’s contamination of low sulfur standard prior to leaving the
act with this fuel. sulfur additives with high sulfur manufacturer’s control. Once they meet
The Agency expects to enforce the additives during transportation. The their defense to presumptive liability,
liability scheme of the NRLM diesel increased probability that parties in the these additive system parties will only
sulfur rule in the same manner that we diesel additive distribution system be held responsible for the diesel fuel
have enforced the similar liability could cause a violation of the sulfur non-conformity in situations in which
schemes in our prior fuels regulations. standard warrants the imposition by the EPA can establish that the party actually
As in other fuels programs, we will Agency of increased liability for such caused the violation.
attempt to identify the party most parties. Therefore, today’s rule, like the Under today’s rule, parties in the
responsible for causing the violation, final highway diesel rule, explicitly diesel fuel distribution system will have
makes parties in the diesel additive the typical affirmative defenses of other
199 At downstream locations the violation will
distribution system liable for the sale of fuels rules. For parties blending an
occur if EPA’s test result show a sulfur content of
greater than 17 ppm, which takes into account the
nonconforming diesel fuel additives, additive into their diesel fuel, the
two ppm adjustment factor for testing even if such additives have not yet been requirement to maintain PTDs showing
reproducibility for downstream parties. blended into diesel fuel. In addition, that the product complied with the
regulatory standards will necessarily volume accounting reconciliation to show either compliance or
include PTDs for the additive that was records in lieu of the requirement to noncompliance. Similarly, absent the
used, affirming the compliance of the sample and test each batch of fuel existence of sulfur test results using an
additive and the fuel. subject to the 15 ppm sulfur standard approved method, commercial
after the addition of an additive that documents asserting the sulfur level of
c. Liability When the Additive Is
exceeds the 15 ppm sulfur standard. diesel fuel or additive could be used as
Designated as Having a Possible Sulfur
Today’s rule also implements these some evidence of what the sulfur level
Content Greater than 15 ppm
same alternate defense requirements of the fuel would be if the product
Under today’s rule, a nonroad diesel regarding the blending of such additives would have been tested using an
fuel additive will be permitted to have into 15 ppm highway diesel fuel. approved method.
a maximum sulfur content above 15 The Agency believes that the same
ppm if the blended fuel continues to I. How Will Compliance With the Sulfur statutory authority for EPA to adopt the
meet the 15 ppm standard and the Standards Be Determined? gasoline sulfur rule’s evidentiary
additive is used at a concentration no Today’s rule provides that compliance provisions, Clean Air Act section 211(c),
greater than one volume percent of the with the sulfur standards and use provides appropriate authority for the
blended fuel. However, if nonroad requirements under today’s rule can be evidentiary provisions of today’s diesel
diesel fuel containing that additive is determined by evaluating the designate sulfur rule. For a fuller explanation of
found by EPA to have high sulfur and track records (discussed in section this statutory authority, see the gasoline
content, then all the parties in both the IV.D.) and other records, such as PTDs; sulfur final rule preamble, 65 FR 6815,
additive and the fuel distribution chains by evaluating compliance with the fuel February 10, 2000.
will be presumed liable for causing the marker requirements discussed in
nonroad diesel fuel violation. section IV.D and V.E; and by sampling VI. Program Costs and Benefits
Since this type of high sulfur additive fuel and testing for sulfur content. In this section, we present the
presents a much greater probability of Today’s rule includes a requirement for projected cost impacts and cost
causing diesel fuel non-compliance, refiners and importers to measure the effectiveness of the nonroad Tier 4
parties in the additive’s distribution sulfur content of every batch of NRLM emission standards and fuel sulfur
system will have to satisfy an additional fuel designated under the rule, using a requirements. We also present a benefit-
element to establish an affirmative testing methodology approved under the cost analysis and an economic impact
defense. In addition to the elements of provisions discussed in section V.H of analysis. The benefit-cost analysis
an affirmative defense described above, this preamble. In general, downstream explores the net yearly economic
parties in the additive distribution parties must conduct only periodic benefits to society of the reduction in
system for such a high sulfur additive sampling and testing as an element of a mobile source emissions likely to be
will also be required to establish that defense to presumptive liability achieved by this rulemaking. The
they did not cause the violation, an (retailers are exempt from sampling and economic impact analysis explores how
element of an affirmative defense that is testing). Today’s rule further provides the costs of the rule will likely be shared
typically required in EPA fuel programs that in determining compliance, any across the manufacturers and users of
to rebut presumptive liability. evidence from any source or location the engines, equipment and fuel that
Parties in the diesel fuel distribution can be used to establish the diesel fuel would be affected by the standards.
system will essentially have to establish sulfur level, provided that such We revised our cost and benefit
the same affirmative elements as in evidence is relevant to whether the analysis to reflect the comments we
other fuels rules, with an addition sulfur level would have met the received on our analysis. The fuel-
comparable to the highway diesel rule. applicable standard had compliance related costs have been updated to
Blenders of high sulfur additives into 15 been determined using an approved test reflect information received from
ppm sulfur nonroad diesel fuel, will methodology. While the use of a non- refiners as part of EPA’s highway diesel
have to establish a more rigorous quality approved test method might produce fuel program, comments received on the
control program than will exist without results relevant to determining sulfur nonroad NPRM, as well as more recent
the addition of such a high sulfur content, this does not remove any information available on future energy
additive. For additives other than static liability for failing to conduct required costs and the cost of advanced
dissipater additives, to establish a batch testing using an approved test desulfurization technologies. The
defense to presumptive liability, the method. This is consistent with the engine and equipment-related costs
Agency has adopted the proposal to approach taken under the gasoline were revised to reflect additional R&D
require test results establishing that the sulfur rule and the highway diesel costs associated with tailoring R&D to
blended fuel was in compliance with sulfur rule. each particular engine line and to
the 15 ppm sulfur standard after being For example, the Agency might not accommodate changes in the final
blended with the high sulfur additive. have sulfur results derived from an emission control requirements,
This additional defense element will be approved test method for diesel fuel particularly with regard to engines
required as a safeguard to ensure sold by a terminal, yet the terminal’s above 750 hp. These costs are also now
nonroad diesel fuel compliance, since own test results, based on testing using presented in 2002 instead of 2001
the blender has voluntarily chosen to methods other than those approved dollars. With regard to the benefits
use an additive which increases the risk under the regulations, could reliably analysis, we have updated our methods
of diesel fuel non-compliance. show a violation of the sulfur standard. consistent with Science Advisory Board
An exception to this defense element Under today’s rule, evidence from the (SAB) advice as specified in RIA chapter
is made for blenders of static dissipater non-approved test method could be 9. Finally, we adjusted the economic
additives, that are allowed by today’s used to establish the diesel fuel’s sulfur impact analysis to reflect the revised
rule to contribute no more than 0.05 level that would have resulted if an cost inputs and to explicitly model the
ppm to the sulfur content of a finished approved test method had been impacts on the locomotive and marine
fuel subject to the 15 ppm sulfur conducted. This type of evidence is intermediate market sectors.
standard. As discussed in section V.C.5, available for use by either the EPA or The results detailed below show that
blenders of such additives may rely on the regulated party, and could be used this rule would be highly beneficial to
society, with net present value benefits A. Refining and Distribution Costs ppm cap on locomotive and marine fuel
through 2036 of $805 billion using a 3 Meeting the 500 and 15 ppm sulfur in 2012, as well as improving our
percent discount rate and $352 billion caps will generally require that refiners analysis of the impact of this cap on
using a 7 percent discount rate, add hydrotreating equipment and costs incurred in the distribution
compared to a net present value of possibly new or expanded hydrogen and system.
social cost of about $27 billion using a sulfur plants in their refineries. We have The costs to provide NRLM fuel under
3 percent discount rate and $14 billion estimated the cost of building and the two-step fuel program are
using a 7 percent discount rate. The operating this equipment using the same summarized in Table VI.A–1 below. All
impact of these costs on society should basic methodology which was described of the following costs estimates are in
be minimal, with the prices of goods in the NPRM. We have updated that 2002 dollars. Capital investments have
and services produced using equipment analysis with new information obtained been amortized at 7 percent per annum
and fuel affected by standards being from the vendors of advanced before taxes. These estimates do not
expected to increase about 0.1 percent. desulfurization technology, to better include costs associated with fuel sulfur
reflect current crude oil properties and testing, labeling, reporting or record
Further information on these and refinery configurations, as well as future keeping, which we believe will be small
other aspects of the economic impacts of hydrogen costs. We have also relative to those associated with
this emission control program are incorporated information received from refining, distribution and lubricity
summarized in the following sections refiners regarding their plans to produce additives. A more detailed description
and are presented in more detail in the 15 ppm highway diesel fuel from 2006– of the costs associated with this final
Final RIA for this rulemaking. 2010. Finally, we incorporated the 15 rule is presented in the Final RIA.
TABLE VI.A– 1.— COST OF PROVIDING NRLM DIESEL FUEL
(cents per gallon of affected fuel)
Affected fuel
volume (mil- Distribution
NRLM diesel fuel Years Refining Total
lion gallons (and lubricity)
per year) a
500 ppm ......................................................... 2007– 2010 ..................................................... 11,860 1.9 0.2 2.1
2010– 2012 ..................................................... 3,589 2.7 0.6 3.3
2012– 2014 ..................................................... 715 2.9 0.6 3.5
15 ppm ........................................................... 2010– 2012 ..................................................... 8,145 5.0 0.8 5.8
2012– 2014 ..................................................... 12,068 5.6 0.8 6.4
2014 + ........................................................... 13,399 5.8 1.2 7.0
Notes: a Volumes shown are for first full year in each period (2008, 2011, 2013, and 2015).
The costs shown (and all of the costs our estimated cost of the second step First, we estimate the total volume of
described in the rest of this section) significantly in response to comments. NRLM fuel which must be desulfurized
apply to the 74 percent of current NRLM These comments and the changes to our during each step of the program, as well
fuel that currently contains more than cost estimates are discussed in more as each refinery’s future total
500 ppm sulfur (hereafter referred to as detail in the next two sections. The production of distillate fuel. Current
the affected volume). combined cost for both steps is therefore and future demand for all distillate fuels
In 2014, the affected volume of NRLM somewhat higher than expected in the except diesel fuel for land-based
fuel is 14.6 billion gallons out of total NPRM, but nevertheless consistent with equipment were based on estimates
NRLM fuel volume of 19.7 billion projections for the cost of 15 ppm from the Energy Information
gallons. The other 5.1 billion gallons of highway diesel fuel. Administration’s (EIA) Fuel Oil and
NRLM fuel is currently spillover from We expect that the increased cost of Kerosene Survey (FOKS) for 2001 and
fuel certified to the highway diesel fuel refining and distributing 500 ppm the 2003 Annual Energy Outlook (AEO).
standards. We expect this to continue NRLM fuel will be completely offset by EPA’s NONROAD emission model was
reductions in maintenance costs, while
under the 2007 highway diesel fuel used to estimate both current and future
those for 15 ppm NRLM fuel will be
program. Thus, 26 percent of NRLM fuel fuel consumption by land-based
significantly offset. These savings will
will already meet at least a 500 ppm nonroad equipment to ensure the
apply to all diesel engines in the fleet
sulfur cap by 2007 and a 15 ppm cap by consistent treatment of both the costs
due to the reduced fuel sulfur content,
2010 and will not be affected by today’s and benefits associated with this rule.
not just new engines. Refer to section
rule. The costs and benefits of Table VI.A–2 shows our projections of
V.B for a more complete discussion on
desulfurizing this highway fuel which the volumes of fuel affected by today’s
the projected maintenance savings
spills over into the non-highway rule. These volumes exclude NRLM fuel
associated with lower sulfur fuels.
markets was included in our cost expected to be certified to highway
estimates for the 2007 highway diesel 1. Refining Costs diesel fuel sulfur caps prior to the
fuel rule. Methodology: We followed the same implementation of this rule. They also
The estimated cost of the first step of process that we used in the NPRM to exclude distillate fuel meeting a 500
the NRLM fuel program is slightly less project refining costs, though we have ppm cap which is produced during
than that projected in the NPRM (cents broken down the description into five distribution from highway diesel fuel,
per gallon). However, we have increased steps instead of four. jet fuel, etc.
VerDate jul<14>2003 17:54 Jun 28, 2004 Jkt 203001 PO 00000 Frm 00151 Fmt 4701 Sfmt 4700 E:\FR\FM\29JNR2.SGM 29JNR2
TABLE VI.A– 2.— VOLUME OF NRLM FUEL AFFECTED BY TODAY’S RULE

(billion gallons per year)
Nonroad Locomotive and Total

marine
500 500
15 ppm 500 15 ppm
ppm 15 ppm ppm
ppm
2008 ................................................................................................................................. 8,406 0 3,454 0 11,860 0

2011 ................................................................................................................................. 614 8,145 2,975 0 3,589 8,145
2013 ................................................................................................................................. 468 8,671 247 3,395 715 12,066
2015 ................................................................................................................................. 0 10,539 2,860 0 13,399
This marks a change from the which utilized actual refiner production others will need to build an entirely
proposal, where all distillate fuel in 2000. The number of refineries new unit. Some refiners will be able to
volumes were based on EIA FOKS and needing to produce 500 ppm and 15 expand their production of highway fuel
AEO estimates. Commenters pointed out ppm diesel fuel under today’s final rule at little incremental cost, while others
that this approach underestimated fuel- was based on the projected diesel fuel will be able to reduce their investment
related costs relative to emission and heating oil demand in 2014.200 To substantially by reducing their
reductions and monetized benefits, be consistent, the 2002 distillate production volume. Use of refiners’ own
since the NONROAD fuel volumes used production volumes of individual projections, as opposed to our own cost
to estimate the latter were larger. We in refiners were increased to 2014 levels methodology assumptions, allows us to
fact had acknowledged this using EPA projections of growth in total incorporate as much refinery-specific
inconsistency in the proposal and had distillate production by domestic information as is currently possible.
said we would address it in the final refiners.
Third, we estimated the cost to In projecting desulfurization costs, we
rule. Our approach to address the updated a number of the inputs to our
inconsistency was to utilize the land- desulfurize diesel fuel to both 500 ppm
and 15 ppm for each domestic refinery. cost estimation methodology. We
based nonroad fuel volumes estimated increased natural gas and utility costs to
by the NONROAD model for both the This considered both the volume of
diesel fuel being produced and its reflect those projected in EIA’s 2003
costs and monetized benefits. However,
composition (e.g., percentage of straight AEO. The NPRM analysis utilized
we also conducted a sensitivity analysis
run, light cycle oil, etc.). Estimates of projections from 2002 AEO. Forecasted
whereby both emissions and costs were
the volumes of diesel fuel already being natural gas costs in 2003 AEO are
estimated using EIA estimates of fuel
desulfurized to meet the highway diesel considerable higher than in 2002 AEO,
demand by land-based nonroad
fuel standards in 2006–2010 prior to the though still lower than current market
equipment. The results of that analysis
implementation of this final rule were prices. In response to comments, we
are discussed in chapter VII of the Final
based on refiners’ pre-compliance also increased the factor for off-site
RIA.
reports.201 This marks a change from the capital costs to better reflect the cost of
We made one other revision to the
NPRM analysis, where we assumed that sulfur plant expansions. The NPRM
volume of diesel fuel affected by this
refiners would continue to produce analysis utilized an off-site factor
rule. In analyzing the impact of the 2007
their current mix of highway and high developed in support of the Tier 2
highway diesel fuel program for the
sulfur diesel fuel. While many refiners gasoline and 2007 highway diesel fuel
NPRM analysis, we estimated that 4.4
indicated that their plans were programs, where the amount of sulfur
percent of 15 ppm highway diesel fuel
would be contaminated during preliminary and subject to change, we removed per gallon was a fraction of
shipment and not available for sale as consider these projections to be more that occurring here with NRLM fuel. We
15 ppm highway fuel. This increased probable than assuming that current also continued to update our cost
the volume of 15 ppm highway fuel producers of diesel fuel will make no estimates for advanced desulfurization
which had to be produced at refineries change to their product mix in technologies, as these technologies
before accounting for the production of complying with the highway rule. continue their evolution. As discussed
additional 500 and 15 ppm NRLM fuel Meeting the 15 ppm highway diesel fuel in Section IV, the latest information
in response to the NRLM fuel program. cap will require significant investment, concerning Process Dynamics’s
Due to comments made on the NRPM but some refiners will face more than IsoTherming process indicate somewhat
(discussed in section VI.A.3. below), we others. Some refiners will be able to higher costs than earlier estimates. We
have improved our analysis to track the revamp their current hydrotreater, while also reduced our projection of the
disposition of this contaminated 15 ppm penetration of these advanced
fuel. Much of this contaminated fuel can
200 The year 2014 represents a mid-point between technologies in 2010 from 80 to 60
the initial year of today’s fuel program and the end percent.
be sold as 500 ppm NRLM from 2007– of the expected life of desulfurization equipment
2014 and as L&M fuel thereafter. Thus, (roughly 15 years). Fourth, we estimated which refineries
the contaminated 15 ppm fuel reduces 201 Under EPA’s 2007 highway diesel program, will likely find it difficult to stay in the
the volume of 500 and 15 ppm NRLM refiners are required to submit their production heating oil market after the
plans for highway diesel fuel for 2006–2010. The
fuel which must be produced at first of these reports were due during the summer
implementation of the NRLM sulfur
refineries. of 2003. EPA published a summary of the results standards, due to their location relative
Second, total distillate production by this past fall. We consider these reports to provide to major pipelines and the size of the
individual refineries were based on a more accurate projection of individual refinery heating oil market in their area. Those
plans than our projections made during the
their actual production volumes in highway fuel FRM. The latter was based on cost
not located in major heating oil markets
2002, as reported to EIA. This represents minimization using our refinery-specific and not connected to pipelines serving
a minor revision to the NPRM analysis, desulfurization refinery model. these areas were projected to have to
meet the 500 and 15 ppm caps in 2007 to imports. Thus, imports of 15 and 500 15 ppm highway diesel fuel; 96
and 2010, respectively. ppm NRLM fuel were only assumed refineries starting in 2006 and 4 in 2010.
Fifth, we estimated which of the after all refineries in a PADD were Of these 100 refineries, 96 currently
remaining refineries would likely projected to produce either 15 or 500 produce some volume of highway diesel
produce NLRM fuel under today’s ppm fuel, respectively. The small fuel, while 4 refineries currently only
program. As was done in the proposal, refiner provisions included in today’s produce high sulfur distillate fuel. Also,
we assumed that those refineries with NRLM fuel program were considered, as 18 refineries will cease to produce
the lowest projected compliance costs these provisions temporarily reduce the highway diesel fuel and shift to
would be the most likely to produce the volume of 500 and 15 ppm fuel required producing solely high sulfur distillate
required fuel until demand was met. to be produced in 2007 and 2010, fuel. This will leave a total of 92
Inter-PADD transfers of fuel between respectively. This portion of the refineries still producing high sulfur
PADD 3 and PADD 1 were not methodology was the same as that used distillate after full implementation of
constrained. PADD 3 refineries were in the NRPM analysis.
also assumed to supply PADD 2 with 15 Results: Based on EIA data, in 2002 the 2007 highway diesel fuel program.
ppm NRLM fuel once all PADD 2 114 refineries produced highway diesel The number of these 92 domestic
refineries were producing 15 ppm fuel and 102 refineries produce high refineries expected to produce either 15
distillate fuel. We also assumed that sulfur diesel fuel or heating oil. Based or 500 ppm NRLM diesel fuel in
domestic refineries would preferentially on refiners’ pre-compliance reports, we response to today’s rule is summarized
supply the lowest sulfur fuels compared project that 100 refineries will produce in Table VI.A–3.
TABLE VI.A– 3.— REFINERIES PROJECTED TO PRODUCE NRLM DIESEL FUEL UNDER THIS FINAL RULE
500 ppm NRLM diesel fuel 15 ppm NRLM diesel fuel
Year of
program Small Small
All refineries All refineries
refineries refineries
2007– 2010 ....................................................................................................................... 36 0 0 0

2010– 2012 ....................................................................................................................... 26 13 32 2
2012– 2014 ....................................................................................................................... 15 13 47 2
2014+ ............................................................................................................................... 0 0 63 15
During the four periods shown in volume of 500 ppm NRLM fuel coming be $2280 million, or $36 million per
table VI.A–3, two roughly parallel sets from existing hydrotreaters. This refinery, roughly 5 percent greater than
of standards become effective. For non- conclusion is based on the number of that projected in the NPRM. Total
small refiners, the 500 ppm NRLM fuel refineries leaving the highway diesel operating costs will be about $8.1
cap starts in 2007, followed by the 15 fuel market according to the refiners’ million per year for the average refinery,
ppm nonroad fuel cap in 2010, in turn highway program pre-compliance slightly lower than that projected in the
followed by the 15 ppm L&M fuel cap reports. The investment per refinery that NPRM ($8.3 million per year). The total
in 2012. For small refiners, the 500 ppm we projected in the NPRM ($9.7 million) refining cost, including the amortized
NRLM fuel cap starts in 2010, followed was essentially unchanged. Operating cost of capital, will be 5.0, 5.6 and 5.8
by the 15 ppm nonroad NRLM fuel cap costs will be about $4.9 million per year cents per gallon of new 15 ppm NRLM
in 2014. As shown, beginning in 2014, for the average refinery, or slightly fuel in 2010, 2012, and 2014,
63 refineries are projected to be affected greater than that projected in the NPRM respectively.
by today’s final rule. After complete (due to higher hydrogen costs and a The 500 pm NRLM fuel being
implementation of today’s rule, 29 lower percentage of hydrocrackate in produced in 2010 is projected to cost 2.7
refineries are expected to be able to the NRLM pool). The average cost of cents per gallon. The cost of this 500
produce high sulfur heating oil, some as producing 500 ppm NRLM fuel in 2007 ppm fuel is higher than that projected
their entire distillate production, others will be 1.9 cents per gallon, 0.3 cent per in the NPRM, due primarily to a higher
along with 15 ppm fuel. The number of gallon lower than that projected in the cost for natural gas in the future. The
refineries estimated to be affected by NPRM, due primarily to the reduced 500 pm, small refiner fuel being
produced in 2012 is projected to cost 2.9
today’s rule is one more than that capital expenditure.
cents per gallon. All of these costs are
projected in the NPRM. There, we In 2010, an additional $1170 million relative to the cost of producing high
estimated that 62 refineries would have will be invested in revamped and new sulfur fuel today, and includes the cost
to produce either 15 or 500 ppm NRLM desulfurization equipment, $1090 of meeting the 500 ppm standard
fuel in 2014 and beyond. million to meet the 15 ppm nonroad beginning in 2007.
We project that the capital cost fuel cap and $80 million to produce 500 The 15 ppm refining costs are
involved to meet the 2007 500 ppm ppm NRLM fuel no longer eligible for a significantly higher than the 4.4 cent per
sulfur cap will be $310 million. This small refiner exemption to sell high gallon cost projected in the NPRM for
represents about $10 million for each of sulfur NRLM fuel. In 2012, an the option where L&M fuel was
the 30 refineries building a new additional $590 million will be invested controlled to 15 ppm in addition to
hydrotreater. Six refineries are expected in revamped and new desulfurization nonroad fuel. The increase is due to the
to produce 500 ppm NRLM fuel using equipment to meet the 15 ppm L&M cap changes in refining cost methodology
existing hydrotreaters no longer being Finally, in 2014 an additional $210 described above, particularly the
used to produce 500 ppm highway fuel. million will be invested in additional 15 reduced use of advanced desulfurization
The total investment cost is roughly half ppm fuel capacity. Thus, total capital technology, reduced synergies with the
that projected in the NPRM ($600 cost of new equipment and revamps highway fuel program and increased
million). The decrease is due to a greater related to the NRLM fuel program will natural gas costs.
The average refining costs by refining small refiner provisions. Combined fuel which is shipped from PADD 3 to
region are shown in table VI.A–4 below. costs are shown for PADDs 1 and 3 PADD 1.
These costs include consideration of the because of the large volume of diesel
TABLE VI.A– 4.— AVERAGE REFINING COSTS BY REGION

[Cents per gallon]
500 ppm Cap 15 ppm Cap
2007– 2010 2010– 2012 2012– 2014 2010– 2012 2012– 2014 2014+
PADDs 1 & 3 ........................................................................... 1.6 3.7 2.5 4.6 4.9 5.1

PADD 2 .................................................................................... 2.8 2.9 3.7 7.1 7.8 7.8
PADD 4 .................................................................................... 3.3 9.0 9.0 11.6 11.7 11.8
PADD 5 .................................................................................... 1.2 2.8 3.5 4.3 4.3 5.7
Nationwide ............................................................................... 1.8 2.7 2.9 5.0 5.6 5.8
Fuel-Only Control Programs: We used back to refineries and reprocessed to mixture of gasoline and any distillate
the same methodology to estimate meet the 15 ppm cap. We designed the fuel, such as jet or diesel fuel. If this
refining costs for stand-alone 500 ppm program finalized today to allow the interface was added to the distillate
and 15 ppm NRLM fuel programs. The continued sale of 500 ppm fuel into the batch, the gasoline content in the
fully phased in refining impacts of a 15 NRLM market until June 1, 2014, and interface would result in a violation of
ppm NRLM standard are the same as into the locomotive and marine market the distillate’s flash point specification.
those described above for the final rule indefinitely. By doing so, we were able If this interface was added to the
in 2014 and beyond. A fully phased in to minimize, though not eliminate, gasoline batch, it would cause the
500 ppm NRLM fuel program is much of the reprocessing and gasoline to violate its end point
projected to affect 63 refineries, cost 2.0 distribution cost impacts of concern. We specification. Therefore, this interface
cents per gallon and require a capital have evaluated both the production and must be shipped to a transmix processor
investment of $480 million. potential sale of distillate interface and to separate the mixture into naphtha (a
2. Distribution Costs estimated the distribution cost impacts sub-octane gasoline) and distillate. The
of today’s final rule provisions. The 2007 highway diesel fuel program will
Today’s rule is projected to impact details of this analysis are contained in not change this practice. The naphtha
distribution costs in four ways. First, we chapter 7 of the Final RIA.
project that a slightly greater volume of produced by transmix processors from
In our analysis of the 15 ppm highway gasoline/distillate mixtures is usually
diesel fuel will have to be distributed, fuel program, we projected that the need
due to the fact that some of the blended with premium gasoline to
to protect the quality of 15 ppm produce regular grade gasoline. The
desulfurization processes reduce the highway diesel fuel would increase the
fuel’s volumetric energy density during distillate produced is an acceptable high
volume of highway diesel fuel sulfur diesel fuel or heating oil, though
processing. Total energy is not lost downgraded to a lower value product,
during processing, as the total volume of if the feed material was primarily low
such as high sulfur diesel fuel and sulfur distillate and gasoline it will
fuel is increased in the hydrotreater. heating oil, from its current level of
However, a greater volume of fuel must likely also meet the current 500 ppm
approximately 2.2 percent to 4.4 highway fuel cap.
be consumed in the engine to produce
percent. Under today’s rule, we expect
the same amount of power. We project With the implementation of the
that 15 ppm NRLM fuel will be shipped
that desulfurizing diesel fuel to 500 highway diesel rule, there is another
together with 15 ppm highway. Thus,
ppm will reduce volumetric energy incompatible interface, that between jet
the size of each batch of 15 ppm fuel
content by 0.7 percent. The cost of fuel and 15 ppm diesel fuel. This
will increase, but the number of batches
which is equivalent to 0.08 cent per interface can not be cut into jet fuel due
will not. As the downgrade occurs at the
gallon of affected NRLM fuel. 202 We to end point and other concerns.
interface between batches, the volume
project that desulfurizing diesel fuel to However, it can usually be cut into 500
being downgraded should not increase.
15 ppm will reduce volumetric energy ppm diesel fuel as long as the sulfur
At the same time, we are not projecting
content by an additional 0.52 percent. level of the jet fuel is not too high. With
This will increase the cost of that interface volume will decrease, as
high sulfur fuels, such as jet fuel and, the lowering of the highway standard to
distributing fuel by an additional 0.05 15 ppm, however, this will no longer be
cents per gallon, for a total cost of 0.13 in some cases heating oil, will still be
in the system. possible. We expect that pipelines
cents per gallon of affected 15 ppm minimize this interface by abutting jet
NRLM fuel. The issue here is the market to which
this interface volume can be sold. When fuel and high sulfur distillate in the
The second impact on distribution pipeline whenever possible. However, it
costs relates to the disposition of 15 this interface volume meets the
specifications of one of the two fuels will be unavoidable under many
ppm fuel contaminated during pipeline
being shipped next to each other, the circumstances. A substantial part of the
shipment. We received comments that
interface is simply added to the batch of pipeline distribution system currently
the control of L&M fuel sulfur content,
that fuel. For example, the interface does not handle high sulfur distillate,
particularly to 15 ppm, would make it
between regular and premium gasoline and we expect that the highway
difficult to sell off-specification 15 ppm
is added to the regular grade batch. Or, program and today’s rule will likely
fuel. The comments argued that much of
the interface between jet fuel and cause additional pipeline systems to
this material would have to be shipped
heating oil is added to the heating oil discontinue carrying high sulfur
202 See chapter 7 of the RIA for further details batch. One interface which is never distillate. Pipelines that do not carry
regarding our estimation of distribution costs. added to either adjacent batch is a high sulfur distillates will generate this
interface whenever they ship jet fuel.203 the primary NRLM fuel and be widely being produced from 2010–2014 due to
The highway rule, and today’s rule distributed. Beyond 2010, we estimate today’s rule, the additional distribution
projects that pipeline operators will that terminals will have to add a small cost from 2010–2014 is 0.4 cents per
segregate this interface by cutting it into storage tank for this fuel, as 500 ppm gallon.
a separate storage tank. Because this highway diesel fuel and the majority of Starting in 2014, this interface fuel
interface can be sold as 500 ppm NRLM 500 ppm NRLM disappears from the can no longer be sold to the nonroad
fuel or heating oil, and because these distribution system. In many places, this fuel market. Since the interface volume
markets exist nationwide, there is little interface will be the primary, if not sole does not change, this increases the
impact beyond the need for refiners to source of 500 ppm fuel, so existing volume of fuel that must be sold to the
produce more 15 ppm highway diesel tankage to add this interface to will be L&M and heating oil markets. Thus,
fuel (compared to the volume of limited. We have also added shipping overall, transportation distances and
highway diesel fuel produced prior to costs to transport this fuel to NRLM and costs will likely increase. We expect
the implementation of the 15 ppm heating oil users. The volume of this that the transportation cost for fuel sold
standard), which was considered as part interface is significant, sometimes a to the L&M market will increase from
of the refining costs in the highway sizeable percentage of the combined 1.5 to 3.0 cents per gallon, while that for
diesel rule. NRLM fuel and heating oil markets. In heating oil will increase to 5.0 cents per
With control of nonroad fuel to 15 the post-2014 period, the volume of this gallon, both including fuel storage.
ppm sulfur in 2010 and LM fuel to 15 interface fuel is larger than the However, in PADD 5, the volume of
ppm sulfur in 2012, the opportunities to combined L&M fuel and heating oil interface generated exceeds the total
downgrade interface to another product markets in certain PADDs. Also, the fuel demand of these two markets. Thus,
become increasing limited. Where volume of interface received at each we estimate that some fuel will have to
limited this will increase costs due to terminal will vary substantially, be shipped back to refineries and
the need to transport the interface to depending on where that terminal is on reprocessed to meet a 15 ppm cap and
where it can be marketed or to a facility the pipeline. The advantage of this is shipped out a second time. We estimate
for reprocessing. In areas with large that where the interface accumulates it that the cost of this shipping and
heating oil markets, such as the may be of sufficient volume to justify reprocessing will cost 10 cents per
Northeast and the Gulf Coast, the marketing as a separate grade of fuel. gallon. When spread over all the 15 ppm
control of NRLM sulfur content will still Conversely, the potential users of this NRLM fuel being produced after 2014
have little impact on the sale of this 500 ppm interface fuel may not be due to today’s rule, the additional
interface. However, in areas lacking a located near the terminals with the fuel distribution cost is 0.8 cent per gallon.
large heating oil market, the sale of this necessitating additional transportation The third impact of today’s rule on
distillate interface will be more costs. distribution costs is related to the need
restricted. Because this interface will for additional storage tanks to market
Prior to 2014, 500 ppm fuel can be
composed of 15 ppm diesel fuel and jet additional product grades at bulk plants.
used as NRLM fuel and heating oil
fuel, we estimate that the distillate While this final rule minimizes the
outside of the Northeast/Mid-Atlantic
interface created should nearly always segregation of similar fuels, some
Area. Additional storage tanks will be
meet a 500 ppm cap.204 Thus, this additional segregation of products in the
needed in some cases, as this will be the
interface can be added to 500 ppm distribution system will still be
only source of 500 ppm fuel in the
NRLM batches (as well as heating oil, required. The allowance that highway
marketplace. Amortizing the cost of a
where it is present at the terminal) and NRLM diesel fuel meeting the same
range of storage tank sizes over 15 years
through 2014. After 2014, this 500 ppm sulfur specification can be shipped
of weekly shipments at a seven percent
interface fuel can only be sold as L&M fungibly until it leaves the terminal
rate of return before taxes costs
fuel or heating oil. An exception to this obviates the need for additional storage
produced an amortized cost of 0.2–1.6
applies in the Northeast/Mid-Atlantic tanks in this segment of the distribution
cents per gallon. These costs include the
Area, where this interface cannot be system except for the limited tankage at
carrying cost of the fuel stored in the
sold into the nonroad fuel market after terminals necessary to handle 500 ppm
tank. We estimate that the average
2010, nor into the L&M fuel market after sulfur interface fuel discussed above.205
storage cost will be closer to the lower
2012. Today’s final rule also allows 500 ppm
end of this range, or 0.5 cent per gallon.
In chapter 7 of the Final RIA, we NRLM diesel fuel to be mixed with
Nonroad fuel users are fairly ubiquitous.
estimate the costs related to handling high-sulfur NRLM (though it can no
Thus, increased shipping distances
this interface fuel during the four time longer be sold as 500 ppm fuel).
should be fairly short. We estimated 45
periods (2007–2010, 2010–2012, 2012– However, we expect that the
miles at a cost of roughly 1.5 cents per
2014, and 2014 and beyond). We project implementation of the 500 ppm
gallon. The distance to L&M fuel users
that there will be no additional costs standard for NRLM diesel fuel in 2007
will likely be longer, roughly 100 miles,
prior to 2010, as 500 ppm fuel will be will compel some bulk plants in those
but cost the same due to greater
parts of the country still distributing
efficiencies of rail transport. It will
203 We expect that only three types of fuel will heating oil as a separate fuel grade to
likely cost more to deliver interface fuel
be carried by such pipeline systems: jet fuel, 15 install a second diesel storage tank to
ppm diesel fuel, and gasoline (premium and to heating oil users, as many of these
handle this 500 ppm NRLM fuel. These
regular). Premium and regular gasolines are always users are smaller, not evenly dispersed
bulk plants currently handle only high-
shipped next to each other so the interface between geographically, purchase fuel
premium and regular gasoline can be cut into the sulfur fuel and hence will need a second
seasonally, and lack rail connections.
batch of regular gasoline. Thus, whenever jet fuel tank to continue their current practice of
is shipped it will abut 15 ppm diesel fuel on one We estimate that transport distances
selling fuel into the heating oil market
end and gasoline on the other. will increase an average of 85 miles and
in the winter and into the nonroad
204 See chapter 7.1.7 of the RIA regarding our cost an additional 3.0 cents per gallon
analysis of the sulfur levels of this interface market in the summer. We believe that
over today’s costs to deliver this fuel to
material. This analysis indicated that although the
maximum sulfur specification of jet fuel 3,000 ppm,
the end user, in addition to the 0.5 cent 205 Including the refinery, pipeline, terminal,
in-use jet fuel sulfur levels are frequently below 500 per gallon storage cost. When spread marine tanker, and barge segments of the
ppm. over all the 15 and 500 ppm NRLM fuel distribution system.
some of these bulk plants will convert trucks, the cost for each bulk plant would be no capital costs associated
their existing diesel tank to 500 ppm would be $120,000, and the total one- with the proposed marker requirement.
fuel in order to avoid the expense of time capital cost would be We proposed that the marker would be
installing an additional tank. However, $120,000,000. To provide a added at the refinery gate, and that the
to provide a conservatively high conservatively high estimate of the costs current requirement that non-highway
estimate we assumed that 10 percent of to bulk plant operators, we are assuming fuel be dyed red at the refinery gate be
the approximately 10,000 bulk plants in that all 1,000 bulk plants will do so. made voluntary. Thus, we believed that
the U.S. (1,000) will install a second Amortizing the capital costs over 20 the refiner’s additive injection
tank in order to handle both 500 ppm years, results in a estimated cost for equipment that is currently used to
NRLM diesel fuel and heating oil. tankage at such bulk plants of 0.1 cents inject red dye into off-highway diesel
The cost of an additional storage tank per gallon of affected NRLM diesel fuel fuel could instead be used to inject the
at a bulk plant is estimated at $90,000 supplied. Although the impact on the marker as needed. As a result of the
and the cost of de-manifolding a overall cost of the program is small, the allowance provided in today’s final rule
delivery truck is estimated at cost to those bulk plant operators who that the marker be added at the terminal
$10,000.206 In the NPRM, we estimated need to put in a separate storage tank rather than the refinery gate, and our
that each bulk plant that needed to may represent a substantial investment. reevaluation of the conditions for dye
install a new storage tank would need Thus, we believe many of these bulk injection at the refinery, we are now
to de-manifold a single tank truck. Thus, plants will search out other assessing capital costs for terminals and
the NPRM estimated the cost per bulk arrangements to continue servicing both refiners related to compliance with the
plant would be $100,000. Fuel heating oil and NRLM markets such as fuel marker requirements.
distributors stated that the assumptions an exchange agreement between two Except for fuel that is distributed
and calculations made by EPA in bulk plants that serve a common area. directly from a refiner’s rack, today’s
characterizing costs for bulk plant As a consequence of the end of the final rule allows the marker to be added
operators seem reasonable. However, highway program’s temporary at the terminal rather than at the
they also stated that our estimate that a compliance option (TCO) in 2010 and refinery as we proposed (see section
single tank truck would service a bulk the disappearance of high-sulfur diesel IV.D for a discussion of the fuel marker
plant is probably not accurate. No fuel from much of the fuel distribution requirements).209 We expect that except
suggestion was offered regarding what system resulting from the for fuel dispensed directly from the
might be a more appropriate estimate implementation of today’s rule, we refinery rack, the fuel marker will be
other than the number is likely to be expect that storage tanks at many bulk added to at the terminal to avoid the
much greater. Part of the reason why we plants that were previously devoted to potential for marked fuel to contaminate
estimated that only a single tank truck 500 ppm TCO highway fuel and high- jet fuel during distribution by pipeline.
would need to be de-manifolded, is that sulfur fuel will become available for Terminals that need to inject the fuel
we expected that due to the seasonal dyed 15 ppm nonroad fuel service. marker will need to purchase a new
nature of the demand for heating oil Based on this assessment, we do not injection system, including a marker
versus nonroad fuel, it would primarily expect that a significant number of bulk storage tank and a segregated line and
only be at the juncture of these two plants will need to install an additional injector for each truck loading station at
seasons that both fuels would need to be storage tank in order to provide dyed which fuel that is required to be marked
distributed in substantial quantities. We and undyed 15 ppm diesel fuel to their is dispensed. Terminals will still be
also expected that the small demand for customers beginning in 2010 (the subject to IRS red dye requirements, and
heating oil in the summer and the small implementation date for the 15 ppm thus will not be able to rededicate such
demand for nonroad fuel in the winter nonroad standard).208 There could injection equipment to inject the fuel
could be serviced using a single de- potentially be some additional costs marker. Due to concerns regarding the
manifolded truck. The primary fuel related to the need for new tankage in need to maintain a visible evidence of
distributed during a given season would some areas not already carrying 500 the presence of the fuel marker, today’s
be distributed by single compartment ppm fuel under the temporary rule also contains a requirement that
tank trucks. During the crossover compliance option of the highway nay fuel which contains the fuel marker
between seasons, bulk plant operators diesel program and which continue to also contains visible evidence of red
would switch the fuel to which such carry high sulfur fuel. However, we dye. Furthermore, there is little chance
single compartment tank trucks are used expect them to be minimal relative to to adapt parts of the red dye injection
from nonroad to heating oil and back the above 0.1 cent per gallon cost. Thus, system (such as the feed lines and
again.207 Nevertheless, we agree that the we estimate that the total cost of injectors) for the alternate injection of
subject bulk plant operators would additional storage tanks at bulk plants red dye and the fuel marker due to
likely be compelled to de-manifold that will result from today’s rule will be concerns that NRLM fuel become
more that a single tank truck. Lacking 0.1 cent per gallon of affected NRLM contaminated with the marker.
additional specific information, we diesel fuel supplied. Terminal operators expressed concern
believe that assuming that each bulk The fourth impact on fuel distribution regarding the potential burden on
plant operator de-manifolds three tank costs is a result of the requirement that terminal operators from the capital costs
trucks will provide a conservatively high sulfur heating oil be marked of adding new additive injection
high estimate of the cost to bulk plant beginning June 1, 2007 and that 500 equipment for heating oil. In response to
operators due to today’s rule. ppm sulfur LM diesel produced by these comments, today’s rule includes
If all 1,000 bulk plants were to install refiners or imported be marked from provisions that exempt terminal
a new tank and de-manifold three tank 2010 through 2012 outside of the operators from the fuel marker
206 This estimated cost includes the addition of a
Northeast/Mid-Atlantic Area and requirements in a geographic
separate delivery system on the tank truck. Alaska. The NPRM projected that there ‘‘Northeast/Mid-Atlantic Area’’ and
207 To avoid sulfur contamination of NRLM fuel,
the tank compartment would need to be flushed 208 See Section IV of today’s preamble for 209 A refinery rack functions similar to a terminal
with some NRLM fuel prior to switching from additional discussion of our rational for this in that it distributes fuel by truck to wholesale
carrying heating oil to NRLM fuel. conclusion. purchaser consumers and retailers.
Alaska.210 These provisions provide that $4,150,000. 211 The total capital cost to of 0.003 cents per gallon of affected
any heating oil or 500 ppm sulfur LM refiners and terminals to install marker NRLM fuel. Adding the amortized cost
diesel fuel that would otherwise be injection equipment is estimated to be of the injection equipment necessary to
subject to the fuel marker requirements $5,650,000. Thus, the Northeast/Mid- add the marker to heating oil and the
which is delivered to a retailer or Atlantic Area provisions in today’s rule cost or the marker results in a total
wholesale-purchaser consumer inside minimizes the number of terminals that estimated cost of the marker
the Northeast/Mid-Atlantic Area or will need to install additive injection requirement for heating oil in today’s
Alaska does not need to contain the equipment and its associated cost to rule of 0.01 cents per gallon of affected
marker. The costs of the marker comply with the marker requirement for NRLM fuel.
requirements for heating oil beginning heating oil. The final NRLM rule also requires
in 2007 and for 500 ppm sulfur LM In the NPRM we estimated that the that 500 ppm L&M fuel produced at
diesel fuel from 2010 through 2012 are cost to blenders of the fuel marker in refineries or imported be marked from
discussed separately below. bulk quantities would translate to 0.2 mid-2010 through mid-2012 outside of
cents per gallon of fuel treated with the the Northeast/Mid-Atlantic Area and
The Northeast/Mid-Atlantic Area was marker. This estimate was based on the
defined to include the region where the Alaska. The adoption of a 15 ppm sulfur
fee charged by a major pipeline to inject standard for LM diesel fuel in 2012 in
majority of heating oil in the country is red dye at the IRS concentration into its
projected to continue to be supplied today’s rule allows us to require that LM
customers diesel fuel. We used this fuel be marked from 2010 through 2012
through the bulk distribution system estimate because we lacked specific cost
(the Northeast and Mid-Atlantic). The rather than from 2010 through 2014 as
information on the proposed marker, proposed (see section IV.A). In addition,
vast majority of heating oil consumption and we believed that it provided a
in the U.S. will be within the Northeast/ the way in which the program was
conservatively high estimate of marker crafted to avoid requiring the fuel
Mid-Atlantic Area. Outside of the cost. Since the proposal, we received
Northeast/Mid-Atlantic Area, we expect marker be added to heating oil in the
input from a major distributor of fuel Northeast/Mid-Atlantic Area and Alaska
that only limited quantities of heating markers and dyes, regarding the cost of
oil will be supplied, primarily from allows us to also provide that 500 ppm
bulk deliveries of the specified fuel sulfur LM diesel fuel in these areas is
certain refiner’s racks. We estimate that marker to terminals which translates to
30 refineries and transmix processor not subject to the marker requirement
a cost of 0.03 cents per gallon of fuel (see section IV.D). We project that only
facilities outside of the Northeast/Mid- treated with the marker. The volume of
Atlantic Area will distribute heating oil a small number of refiners will produce
heating oil that we expect will need to 500 ppm sulfur diesel fuel subject to the
from their racks (in limited volumes) on be marked has also decreased
a sufficiently frequent basis to warrant marker requirements fuel and that it
substantially from that estimated in the will not be shipped via pipeline. Thus,
the installation of a marker injection NPRM due to the Northeast/Mid-
system at a total one time cost of most of this fuel can be marked at the
Atlantic Area provisions. We estimate refinery, limiting the number of
$1,500,000. that 1.4 billion gallons of heating oil facilities which need to add marking
Terminals outside of the Northeast/ will be marked annually, for an annual equipment in response to this
Mid-Atlantic Area will mostly be marker cost of $425,000. In the NPRM, requirement. We estimate that 15
located in areas without continued we projected that the cost of marking facilities will have to do so, at a cost of
production and/or bulk shipment of heating oil would continue for three $60,000 each, for a total of $900,000.
heating oil. Consequently, any high years (2007–2010). Under today’s final Amortizing this over the total volume of
sulfur diesel fuel they sell will typically rule, heating oil must be marked affected NRLM fuel produced from mid-
be NRLM. Terminals located within the indefinitely beginning in 2007, but only 2010 to mid-2012 at seven percent per
Northeast/Mid-Atlantic Area will not outside of the Northeast/Mid-Atlantic year before taxes yields a cost for the
need to mark their heating oil, except Area and Alaska. LM marker requirement of 0.004 cent
for those few that choose to ship heating Because heating oil outside of the
per gallon. Including the cost of the
oil outside of the Northeast/Mid- Northeast/Mid-Atlantic Area is being
marker (0.03 cent per gallon of marked
Atlantic Area. The terminals most likely marked to prevent its use in NRLM
fuel) increases this cost to 0.01 cent per
to install marker injection equipment engines, for the purposes of estimating
gallon of NRLM fuel.
will therefore be those in states outside the impact of the marker requirement on
We summed these various costs
the Northeast/Mid-Atlantic Area with the cost of the NRLM program we have
incurred to the distribution system over
modest markets for heating oil after the spread the cost for the marker for
four different time periods. As shown in
implementation of this program. As heating oil over NRLM diesel fuel.
table VI.A–5, the total additional
discussed in chapter 7 of the RIA, in Amortizing the capital costs of marker
distribution cost will be 0.2 cent per
analyzing the various situations, we injection equipment over 20 years,
gallon of NRLM fuel during the first step
project that fewer than 60 terminals results in an estimated cost of 0.006
of the fuel program (from 2007 through
nationwide will choose to install marker cents per gallon of affected NRLM diesel
2010), 0.6 cents per gallon of NRLM fuel
injection equipment at a total cost of fuel supplied. Spreading the cost of the
from 2010 to 2012 and from 2012 to
marker over the volume of affected
2014, and increase to 1.0 cent per gallon
210 Small refiner and credit high sulfur NRLM NRLM fuel results in an estimated cost
thereafter. A more detailed description
will not be permitted to be sold in the area where
terminals are not required to add the fuel marker 211 The estimated marker injection equipment
of the costs associated with downgraded
to heating oil (the ‘‘Northeast/Mid-Atlantic Area’’). costs include the cost of marker storage tanks, lines, jet fuel and 15 ppm diesel fuel is
See section IV.D. and injectors. presented in chapter 7 of the Final RIA.
TABLE VI.A– 5.— SUMMARY OF DISTRIBUTION COSTS

[Cents per gallon]
Time period over which costs apply

Cause of increase in distribution costs
2007– 2010 2010– 2012 2010– 2014 2014+
Distribution of additional NRLM volume .......................................................................... 0.08 0.1 0.1 0.1

Distillate interface handling .............................................................................................. 0 0.4 0.4 0.8
Bulk plant storage tanks .................................................................................................. 0.1 0.1 0.1 0.1
Heating oil and L&M fuel marker ..................................................................................... 0.01 0.02 0.01 0.01
Total .......................................................................................................................... 0.2 0.6 0.6 1.0
3. Cost of Lubricity Additives diesel properties other than fuel there are at least five significant factors,
lubricity in such a way as to require the two of which would tend to decrease
Hydrotreating diesel fuel tends to
use of additives. costs and three of which would tend to
reduce the natural lubricating quality of
We project that all NRLM fuel increase costs. It is not surprising that
diesel fuel, which is necessary for the
meeting a 15 ppm cap will require these factors could counter-balance each
proper functioning of certain fuel
treatment with lubricity additives. Thus, other, leading to the conclusion that the
system components. There are a variety
the projected cost will be 0.2 cent per 500 ppm cap could be extended to
of fuel additives which can be used to
affected gallon of 15 ppm NRLM fuel. NRLM fuel at roughly the same cost as
restore diesel fuel’s lubricating quality.
for highway diesel fuel.
These additives are currently used to 4. How EPA’s Projected Costs Compare The only existing market for 15 ppm
some extent in highway diesel fuel. We to Other Available Estimates diesel fuel is a niche market for fleets
expect that the need for lubricity and the prices for this fuel likely bear
Historically, the price of highway
additives that will result from the little resemblance to the costs of the 15
diesel fuel meeting a 500 ppm sulfur
proposed 500 ppm sulfur standard for ppm highway or NRLM caps. Thus, the
cap has exceeded that of high sulfur
NRLM diesel fuel will be similar to that only cost comparisons which can be
diesel fuel, ranging from 0–5 cents per
for highway diesel fuel meeting the made are those between engineering
gallon from 1995–99 and averaging 2.2
current 500 ppm sulfur cap standard.212 studies. One such study was performed
cents per gallon over this time period
Industry experience indicates that the by Mathpro for the Engine Manufactures
(see chapter 7 of the Final RIA). Fuel
vast majority of highway diesel fuel Association (EMA). Mathpro estimated
prices are often a function of market
meeting the current 500 ppm sulfur cap the cost of controlling the sulfur content
forces which might not reflect the cost
does not need lubricity additives. of highway and NRLM fuel to levels
of producing the fuel. Still, given this is
Therefore, we expect that the great consistent with both 500 ppm and 15
a five-year average price difference, it is
majority of NRLM diesel fuel meeting ppm cap standards.213 A detailed
likely a reasonable indication of the cost
the proposed 500 ppm sulfur standard evaluation of the Mathpro costs is
of reducing highway diesel fuel sulfur to
will also not need lubricity additives. In presented in the Final RIA. There are a
500 ppm. Once the small refiner
estimating lubricity additive costs for number of aspects of the study that
provisions applicable to 500 ppm fuel
500 ppm diesel fuel, we assumed that make direct comparisons between its
expire in 2010, we project that the total
fuel suppliers will use the same estimates and our cost estimates
cost of the 500 ppm NRLM fuel cap will
additives at the same concentration as difficult. Nonetheless, a crude
be 2.4 cents per gallon, well within the
we projected will be used in 15 ppm comparison of 15 ppm costs indicates
range of the historical highway-high
highway diesel fuel. Based on our that our average cost range of 5.7–5.9
sulfur fuel price difference. This
analysis of this issue for the 2007 cent per gallon is quite similar to the
similarity exists despite changes in a
highway diesel fuel program, the cost 5.4–6.6 cents per gallon cost range
number of factors. One, our projection
per gallon of the lubricity additive is estimated by Mathpro.
of future natural gas costs are
about 0.2 cents. This level of use is The other available study of 15 ppm
significantly higher than those existing
likely conservative, as the amount of fuel costs was performed by Baker and
during the above price comparison.
lubricity additive needed increases O’Brien for API and submitted in
Two, the refineries producing highway
substantially as diesel fuel is response to the nonroad NPRM. Baker
diesel fuel historically likely did so
desulfurized to lower levels. We also and O’Brien analyzed two NRLM fuel
because they faced lower costs than
project that only five percent of all 500 control scenarios, but neither one
those refineries continuing to produce
ppm NRLM diesel fuel will require the matched today’s final NRLM fuel
high sulfur distillate. Three,
use of a lubricity additive. Thus, we program. The scenario closest to today’s
desulfurization catalyst efficiency has
project that the cost of additional program assumed that a NRLM fuel
improved dramatically since the
lubricity additives for the affected 500 would be capped at 15 ppm in 2008. In
highway units were installed and
ppm NRLM diesel fuel will be 0.01 cent this case, Baker and O’Brien projected
significant operating experience has
per gallon. See the Final RIA for more that the refinery-specific cost of 15 ppm
been obtained on highway units. Four,
details on the issue of lubricity NRLM fuel would range from 4–17 cents
inflation since the early 1990’s will have
additives. We have no reason to expect per gallon. This is higher than our
increased the cost of constructing the
that the implementation of today’s projected range of 2–14 cents per gallon.
same hydrotreater. Five, and perhaps
NRLM sulfur standards will impact In addition, as described in the next
most importantly, the construction of
212 Please refer to section IV in today’s preamble
some new hydrotreaters to produce 15 213 Hirshfeld, David, MathPro, Inc., ‘‘Refining
for additional discussion regarding our projections

ppm highway diesel fuel will allow the economics of diesel fuel sulfur standards,’’
of the potential impact on fuel lubricity of this existing hydrotreaters to produce 500 performed for the Engine Manufactuers Association,
proposed rule. ppm NRLM fuel at no capital cost. Thus, October 5, 1999.
section, Baker and O’Brien projected steps, providing 8 years of leadtime for shortages could occur under the
that the volume of NRLM fuel produced the final step. We are proposing to highway diesel fuel program, even
at these costs would not fully satisfy provide flexibility to refiners through without the added challenge of
NRLM fuel demand. Presumably, totally the availability of banking and trading producing low sulfur NRLM fuel. The
fulfilling NRLM fuel demand with provisions. We have provided relief for primary basis for their comments was a
domestic production would have cost small refiners and hardship relief for study they had sponsored by Baker and
more. any qualifying refiner. We are also O’Brien, which evaluated the costs and
Baker and O’Brien described portions allowing 500 ppm diesel fuel generated likely supply impacts of the proposal.
of their cost methodology and indicated in the distribution system to be sold as Baker and O’Brien evaluated two
some general assumptions which they L&M fuel indefinitely.
made during the study. However, the NRLM fuel scenarios: (1) A 15 ppm
In the NPRM, we evaluated four NRLM fuel cap starting in 2008, and (2)
absence of detail prevents any detailed possible reasons why refiners might
comparisons of their results to ours. It a 500 ppm NRLM fuel cap starting in
reduce their production of NRLM fuel: 2008, followed by a 15 ppm cap only for
was clear from their report, though, that (1) Chemical processing losses during
Baker and O’Brien made a number of nonroad fuel in 2010. First, Baker and
the desulfurization process, (2) refiners O’Brien projected that 13 refineries with
pessimistic assumptions about refiners’ might leave the NRLM fuel market, (3)
willingness to invest in desulfurization a total crude oil capacity of 971,000
refiners might stop operations altogether barrels per day would close in response
capacity and that this limited the
(i.e., shut down), and (4) refiners might to the 2007 highway rule, roughly half
number of refineries which they
remove certain blendstocks from the in 2006 and half in 2010. (Total U.S.
assumed would invest to meet the
fuel pool to reduce desulfurization refining capacity is currently 16 million
NRLM sulfur caps. This inevitably led
costs. In all four cases, we concluded barrels per day.) Then Baker and
to higher projected costs (and lower
that the answer was no, that the supply O’Brien projected that adding a 15 ppm
production volumes), than if all
of NRLM fuel would likely remain NRLM cap would cause all of the
refineries had been considered. Thus, it
adequate after implementation of the refineries shutting down in 2010 to
is not surprising that they would derive
proposed fuel program. All of these close in 2008, plus one additional
slightly higher costs for a much smaller
findings started from the position that refinery (for a total of 14). Delaying the
volume of fuel. A more detailed
evaluation of the Baker and O’Brien cost there would be adequate supply of 15 ppm cap until 2010 and leaving L&M
estimates can be found in the Final RIA diesel fuel after implementation of the fuel at 500 ppm reduced the number of
and RTC. 2007 highway diesel fuel program. refineries projected to close in 2008, but
Several commenters, namely API and did not change Baker and O’Brien’s
5. Supply of Nonroad, Locomotive and NPRA, took issue with the above four projection that 14 refineries would close
Marine Diesel Fuel sets of arguments, as well as with our by 2010. Given the fact that Baker and
We have developed today’s NRLM conclusion that refiners would not O’Brien projected the same number of
fuel program to minimize its impact on reduce NRLM fuel production. While refinery closures for scenarios #1 and
the supply of distillate fuel. For not requesting any changes to the 2007 #2, it is reasonable to assume that they
example: We have split the control of highway diesel fuel program, they would project similar results for today’s
NRLM fuel to 15 ppm sulfur into two reiterated previous concerns that supply final NRLM fuel program.
TABLE VI.A– 6.— PROJECTED REFINERY CLOSURES: API SPONSORED STUDY BY BAKER AND O’BRIEN
No. of refineries Lost crude capacity
(1000 bbl/day)
2008 2010 2008 2010
2007 Highway Fuel Program ........................................................................................................... 214 8 13 504 971

Plus One-Step 15 ppm NRLM Program .......................................................................................... 14 14 1043 1043
Plus Two-Step NRLM Program ....................................................................................................... 12 14 924 1043
As a result of these refinery closures, refiners. The net shortfalls are shown in up the shortfall, with potentially high
Baker and O’Brien projected shortfalls table VI.A–7 below. Baker and O’Brien price impacts.
in 15 and 500 ppm supply domestic stated that imports would have to make
TABLE VI.A– 7.— PROJECTED SHORTFALL IN NEAR-TERM DIESEL FUEL SUPPLY

[1000 barrels per day]
15 ppm Fuel 500 ppm Fuel
2008 2010 2008 2010
2007 Highway Fuel Program ........................................................................................................... 359 579 308 22

Plus One-Step 15 ppm NRLM Program .......................................................................................... 684 930 165 0
Plus Two-Step NRLM Program ....................................................................................................... 351 639 481 82
214 Closure would occur at the beginning of the
15 ppm highway fuel program, or 2006.
To put these projected shortfalls in desulfurization process will be very have been a number of refinery closures
context, Baker and O’Brien projects total small, (2) refiners will be unlikely to over the past decade, though the trend
diesel fuel demand to be 3.3 million leave the NRLM fuel market, and (3) has slowed considerably. API pointed
barrels per day in this timeframe refiners are unlikely to shut down due towards two specific refineries which
(slightly lower than our own projection to this rule. identified EPA’s gasoline and diesel fuel
summarized above). Thus, these Regarding point #1, the distillate sulfur controls as prime reasons for their
projected shortfalls total roughly 10–20 material lost during desulfurization, our shutting down. A closer look at these
percent of total diesel fuel demand, position is that the amount lost is small situations showed that the future capital
which if true, would be very significant. (two percent), and most of it is lost in investment related to the sulfur controls
We evaluated the Baker and O’Brien the form of naphtha which can be could have been a contributing factor.
study and their findings. Baker and blended into gasoline. Refiners can then However, these refineries faced many
O’Brien made very pessimistic adjust their mix of gasoline and other challenges and the timing of their
assumptions regarding the likelihood distillate production to compensate. API closure (2000 and 2001, respectively)
that refiners would invest in claimed that in the winter, refiners were showed that the EPA rules were not the
desulfurization capacity. Their already at maximum distillate direct cause. The refiner involved did
judgment that a refinery would close production and could not shift any not approach EPA concerning any relief
rather than invest also was apparently additional heavy gasoline material into from the rules’ requirements due to
based only on what they perceived to be the distillate pool. API did not present economic hardship. Thus, the
excessively high desulfurization costs. any evidence that this is in fact the case. connection between their closure and
Baker and O’Brien presents no The fact that some refiners actually our sulfur controls appears even more
information regarding the location of crack distillate material into gasoline tenuous.
these refineries, the competition they makes it difficult to accept their Another example of a refinery closure
face, costs related to closing down, nor position. unrelated to desulfurization costs was
the profits that they would forego by Regarding point #2, refiners leaving Shell’s recent decision to close their
closing. Baker and O’Brien also makes the NRLM fuel market, we argued that refinery in Bakersfield, California. The
no mention of EPA’s special provisions the only high sulfur distillate market reason was an insufficient supply of
for refiners facing economic hardship, remaining after 2007 was heating oil. crude oil being produced locally.
nor the small refiner provisions. Heating oil demand is flat or declining Analogous to a decision to leave the
We believe that it is not possible to over time. We project that over 30 NRLM fuel market, shutting down
project refinery closures without domestic refiners will still be able to completely involves the total loss of any
considering these factors. This is produce heating oil after 2007, while profit being made on the production of
supported by comments made in other refiners will be able to produce other fuels. API presented no economic
response to our proposal of the 2007 sufficient quantities of NRLM fuel. If calculations or projections showing that
highway diesel fuel program by more refiners choose to produce heating it would be in the best interest of any
Mathpro and the National Economic oil, this market will be oversupplied refiner to shut down rather than invest
Research Associates. While we are and prices will drop significantly. in NRLM fuel desulfurization.
aware of a couple of refineries that are Exporting high sulfur distillate is a This leaves point #4, that refiners
being offered for sale and whose plans possibility for some refiners, but this might shift NRLM fuel blendstocks to
for producing low sulfur fuels are entails both transport costs, as well as other markets. This is really only an
uncertain, we have no indications of as relatively low prices overseas. Thus, a issue if the blendstocks are shifted to a
many as eight refineries closing in 2006 decision to not invest in NRLM fuel non-distillate market.215 The most likely
in response to the highway fuel desulfurization has to be compared to place that NRLM fuel blendstocks might
program. In addition, despite the losses involved with the other be shifted is to the residual fuel market.
uncertainties at a few refineries, options. API argued that some refiners In particular, heavy (material with high
refiners’ pre-compliance reports for the face much higher desulfurization costs densities and high distillation
highway fuel program indicate that they than others and this would lead those temperatures) LCO and LCGO could be
are planning to produce a sufficient refiners to leave the NRLM fuel market. shifted to residual fuel using existing
supply of 15 and 500 ppm highway API did not estimate the losses that refining equipment. The heavy portions
diesel fuel from 2006–2010. Therefore, refiners would entail when they left the of these two blendstocks contain the
there is ample evidence that Baker and market. Studies performed for the greatest concentrations of sulfur which
O’Brien’s projections for the highway highway fuel program indicate that is the most difficult to remove. Shifting
diesel fuel program are overly these losses can be quite significant and this material to residual fuel, which
pessimistic. It therefore appears likely inappropriate conclusions can be drawn currently does not have a sulfur
that their projection that the NRLM fuel if they are ignored. The highway standard, would reduce the size and
program will cause an additional program pre-compliance reports also cost of desulfurization equipment
refinery to close is also overly indicate that some highway fuel refiners needed to meet a 15 ppm cap. Or, it
pessimistic. The reader is referred to the are planning on leaving the highway would increase the volume of 15 ppm
RTC for a summary of these comments fuel market in 2006, while others will NRLM fuel which could be produced in
and our detailed response to them. enter it for the first time. Decisions to
an existing hydrotreater.
In their comments, API also stay in or leave the NRLM fuel market To evaluate this possibility, we
challenged our findings that refiners are analogous. We have no reason to estimated the cost of processing LCO
would maintain sufficient supply under believe refiners would approach this (the worse of the two blendstocks) into
the proposed NRLM fuel program. After market any differently than the highway 15 ppm diesel fuel for each domestic
a careful review of their comments and market. refinery. On average, desulfurizing LCO
other information newly available since Regarding point #3, refineries shutting
to 15 ppm sulfur cost 11.4 cents per
the NPRM, we do not believe that the down, API again pointed towards the
arguments presented by API and NPRA high costs faced by some refineries and 215 Shifting NRLM fuel blendstocks to heating oil
justify changing our position that (1) the fact that a number of refineries have is essentially the same as leaving the NRLM market,
chemical processing losses during the shut down over the past ten years. There which was discussed under Point #2 above.
gallon. However, in some cases, this be due to the possibility that some for maintenance and repairs can
cost reached 15 cents per gallon. The refiners might decide to limit their significantly affect total fuel production,
cost to process heavy LCO could be capital investment in desulfurization inventory levels and resulting fuel
twice these amounts, since the capacity by shifting some heavy LCO to prices.
concentration of both total sulfur and the residual fuel market. Predicting the impact of any
the most difficult to remove sulfur are Fuel-Only Control Programs: The individual factor on fuel price is also
concentrated in the heaviest molecules. potential supply impacts of a long-term difficult. The overall volatility in fuel
A review of historic fuel prices 500 ppm NRLM cap would necessarily prices limits the ability to determine the
showed that residual fuel is usually be less than those of today’s final NRLM effect of a factor which changed at a
priced 25–30 cents per gallon less than fuel program. In particular, specific point in time which might have
diesel fuel. The highest incremental desulfurizing ‘‘difficult’’ blendstocks, led to the price change, as other factors
desulfurization costs for heavy LCO like LCO, to 500 ppm is not technically continue to change over time.
could potentially exceed this loss. Thus, challenging and does not have the Occasionally, a fuel quality change,
a few refiners could find it economical potential to cost more than would be such as reformulated gasoline or a 500
to shift a portion of their LCO to the lost in shifting LCO or heavy LCO to ppm cap on diesel fuel sulfur content,
residual fuel market. The U.S. residual residual fuel. The capital investment to only affects a portion of the fuel pool.
fuel market is small relative to the meet a 500 ppm cap is also half of that In this case, an indication of the impact
distillate fuel market, flat, and already needed to meet a 15 ppm cap or less. on price can be inferred by comparing
being fulfilled. Worldwide, the residual Thus, the likelihood that raising this the prices of the two fuels at the same
fuel market is shrinking. Thus, it is capital would prove difficult is much general location over time. However,
unlikely that large volumes of LCO less. Given that we expect the final fuel this is still only possible after the fact,
program to have a very minimal impact
could leave the NRLM fuel market. and cannot be done before the fuel
on supply, a 500 ppm NRLM cap would
However, we cannot rule out the quality change takes place.
be negligible.
possibility that some LCO, particularly The potential impact of a long-term 15 Because of these difficulties, EPA has
that produced by capital-strapped ppm NRLM cap is the same as that for generally not attempted to project the
refiners, could be shifted to residual today’s final fuel program. impact of its rules on fuel prices.
fuel. To estimate the upper limit of this However, in response to Executive
shift, we estimated the volume of heavy 6. Fuel Prices Order 13211, we are doing so here.216
LCO produced by refineries whose LCO It is well known that it is difficult to To reflect the inherent uncertainty in
processing costs exceeded 12 cents per predict fuel prices in absolute terms making such projections, we developed
gallon and which were not owned by with any accuracy. The price of crude three projections for the potential
large, integrated oil companies or small oil dominates the cost of producing impact of the proposed fuel program on
refiners. This costly, heavy LCO gasoline and diesel fuel. Crude oil fuel prices. The range of potential long-
represents 0.4 percent of total NRLM prices have varied by more than a factor term price increases are shown in table
fuel demand, a very small volume. In of two in the past two years. In addition, VI.A–8. (Due to their similarity, we have
this case, we would expect that this loss unexpectedly warm or cold winters can grouped the potential price impacts for
could easily be made up by increased significantly affect heating oil similar quality fuels in the 2010–2012
imports of 15 ppm diesel fuel or consumption, which affects the amount and 2012–2014 time periods.) Short-
domestic refiners facing lower 15 ppm of gasoline produced and the amount of term price impacts are highly volatile,
NRLM fuel costs. distillate material available for diesel as are short-term swings in absolute fuel
Overall, we expect that domestic fuel production. Economic growth, or its prices, and much too dependent on
refiners will continue to produce lack, affects fuel demand, particularly individual refiners’ decisions,
sufficient supplies of NRLM fuel. The for diesel fuel. Finally, both planned unexpected shutdowns, etc. to be
greatest potential for near term loss will and unplanned shutdowns of refineries predicted even with broad ranges.
TABLE VI.A– 8.— RANGE OF POSSIBLE TOTAL DIESEL FUEL PRICE INCREASES
[Cents per gallon] a
Maximum op- Average total Maximum total

erating cost cost cost
500 ppm Sulfur Cap: Nonroad, Locomotive and Marine Diesel Fuel (2007–2010)
PADDs 1 and 3 ............................................................................................................................ 2.9 1.8 4.5

PADD 2 ........................................................................................................................................ 3.0 2.5 3.8
PADD 4 ........................................................................................................................................ 3.7 3.5 6.1
PADD 5 ........................................................................................................................................ 1.2 1.5 1.5
15 ppm Sulfur Cap: NRLM Fuel (2010–2014)
PADDs 1 and 3 ............................................................................................................................ 5.6 5.7 9.4

PADD 2 ........................................................................................................................................ 7.3 7.4 10.8
PADD 4 ........................................................................................................................................ 7.9 12.6 13.6
PADD 5 ........................................................................................................................................ 4.5 5.1 5.2
216 Executive Order 13211, ‘‘Actions Concerning

Supply, Distribution, or Use’’ (66 FR 28355, May
22, 2001).
Regulations That Significantly Affect Energy
TABLE VI.A– 8.— RANGE OF POSSIBLE TOTAL DIESEL FUEL PRICE INCREASES— Continued
[Cents per gallon] a
Maximum op- Average total Maximum total

erating cost cost cost
15 ppm Sulfur Cap: NRLM Fuel (fully implemented program: 2014 +)
PADDs 1 and 3 ............................................................................................................................ 7.7 6.3 9.8

PADD 2 ........................................................................................................................................ 7.7 7.9 11.2
PADD 4 ........................................................................................................................................ 8.3 13.0 13.9
PADD 5 ........................................................................................................................................ 5.1 6.9 7.3
Notes: a At the current wholesale price of approximately $1.00 per gallon, these values also represent the percentage increase in diesel fuel
price.
The lower end of the range assumes depending on the area of the country. In limit price impacts are too high, if the
that prices within a PADD increased to 2010, the price of 15 ppm NRLM fuel conditions exist where prices are set
reflect the highest operating cost will increase a total of 4–13 cents per based on operating costs alone.
increase faced by any refiner in that gallon. In 2014, under this pricing However, these price impacts are
PADD (please see the Final RIA for scenario, 15 ppm NRLM fuel prices will sufficiently low that considering even
details on this methodology). This increase further to 6–13 cents per lower price impacts was not considered
refiner with the highest operating cost gallon. All these potential price impacts critical to estimating the potential
will not recover any of his invested for 500 and 15 ppm fuel, relative to economic impact of this rule.
capital, but all other refiners will those projected in the NPRM, reflect the Second, we assumed in some cases
recover some or all of their investment. differences in cost estimates discussed that a single refinery’s costs could affect
In this case, the price of NRLM fuel will above. fuel prices throughout an entire PADD.
increase in 2007 by 1–3 cents per gallon, There are a number of assumptions While this is a definite improvement
depending on the area of the country. In inherent in all three of the above price over analyses which assume that a
2010, the price of 15 ppm NRLM fuel projections. First, both the lower and single refinery’s costs could affect fuel
will increase a total of 3–7 cents per upper limits of the projected price prices throughout the entire nation, it is
gallon. In 2014, under this pricing impacts described above assume that still conservative. High cost refineries
scenario, 15 ppm NRLM fuel prices will the refinery facing the highest are more likely to have a more limited
increase slightly, to 4–7 cents per compliance costs is currently the price geographical impact on market pricing
gallon. The increase in 2014 is due to setter in their market. This is a worse than an entire PADD. In many cases,
the expiration of the small refiner case assumption which is impossible to high cost refiners continue to operate
provisions, as well as the fact that 500 validate. Many factors affect a refinery’s simply because they are in a niche
ppm fuel created in the distribution total costs of fuel production. Most of location where transportation costs limit
system can no longer be sold to the these factors, such as crude oil cost, competition.
land-based nonroad market. labor costs, age of equipment, etc., are Third, by focusing solely on the cost
The mid-range estimate of price not considered in projecting the of desulfurizing NRLM diesel fuel, we
impacts assumes that prices within a incremental costs associated with lower assume that the production of NRLM
PADD increase by the average refining NRLM diesel fuel sulfur levels. Thus, diesel fuel is independent of the
and distribution cost within that PADD, current prices may very well be set in production of other refining products,
including full recovery of capital (at any specific market by a refinery facing such as gasoline, jet fuel and highway
seven percent per annum before taxes). lower incremental compliance costs diesel fuel. However, this is clearly not
Lower cost refiners will recover more than other refineries. This point was the case. Refiners have some flexibility
than their capital investment, while highlighted in a study by the National to increase the production of one
those with higher than average costs Economic Research Associates (NERA) product without significantly affecting
recover less. Under this assumption, the for AAM of the potential price impacts the others, but this flexibility is quite
price of NRLM fuel will increase in of EPA’s 2007 highway diesel fuel limited. It is possible that the relative
2007 by 1–3 cents per gallon, depending program.217 In that study, NERA economics of producing other products
on the area of the country. In 2010, the criticized the above referenced study could influence a refiner’s decision to
price of 15 ppm NRLM fuel will performed by Charles River Associates, increase or decrease the production of
increase a total of 4–11 cents per gallon. et al. for API, which projected that NRLM diesel fuel under today’s fuel
In 2014, under this pricing scenario, 15 prices will increase nationwide to program. It is this price response that
reflect the total cost faced by the U.S.
ppm NRLM fuel prices will increase causes fuel supply to match fuel
refinery with the maximum total
slightly, to 5–11 cents per gallon. demand. And, this response in turn
compliance cost of all the refineries in
The upper end estimate of price could increase or decrease the price
the U.S. producing highway diesel fuel.
impacts assumes that prices within a impact relative to those projected above.
To reflect the potential that the refinery
PADD increase by the maximum total Fourth, all three of the above price
with the highest projected compliance
refining and distribution cost of any projections are based on the projected
costs under the maximum price scenario
refinery within that PADD, including cost for U.S. refineries of meeting the
is not the current price setter, we
full recovery of capital (at seven percent NRLM fuel sulfur caps. Thus, these
included the mid-point price impacts
per annum before taxes). All other price projections assume that imports of
above. It is possible that even the lower
refiners will recover more than their NRLM fuel, which are currently
capital investment. Under this 217 ‘‘Potential Impacts of Environmental significant in the Northeast, are
assumption, the price of NRLM fuel will Regulations on Diesel Fuel Prices,’’ NERA, for available at roughly the same cost as
increase in 2007 by 1–4 cents per gallon, AAM, December 2000. those for U.S. refineries in PADDs 1 and
3. We have not performed any analysis on local, higher sulfur markets. would have been projected had we
of the cost of lower sulfur caps on diesel However, many overseas refiners focus projected that 5–10 percent of NRLM
fuel produced by foreign refiners. on exports. Both Europe and the U.S. diesel fuel will be imported at
However, there are reasons to believe are moving towards highway and competitive prices.
that imports of 500 and 15 ppm NRLM nonroad diesel fuel sulfur caps in the Fuel-Only Control Programs: We used
diesel fuel will be available at prices in 10–15 ppm range. Europe is currently the same methodology to estimate the
the ranges of those projected for U.S. and projected to continue to need to potential price impacts for stand-alone
refiners. import large volumes of highway diesel 500 ppm and 15 ppm NRLM fuel
One recent study analyzed the relative fuel. Thus, it seems reasonable to expect programs. The potential price impacts of
cost of lower sulfur caps for Asian that a number of overseas refiners will long-term 500 ppm and 15 ppm NRLM
refiners relative to those in the U.S., invest in the capacity to produce some
caps would be the same as those shown
Europe and Japan.218 It concluded that or all of their diesel fuel at these levels.
in table VI.A–8 above for the 500 ppm
costs for Asian refiners will be Many overseas refiners also have the
comparatively higher, due to the lack of NRLM cap in 2007 and for the 15 ppm
flexibility to produce 10–15 ppm diesel
current hydrotreating capacity at Asian NRLM cap in 2014 and beyond,
fuel from their cleanest blendstocks, as
refineries. This conclusion is certainly respectively.
most of their available markets have less
valid when evaluating lower sulfur stringent sulfur standards. Thus, there B. Cost Savings to the Existing Fleet
levels for highway diesel fuels which are reasons to believe that some capacity From the Use of Low Sulfur Fuel
are already at low levels in the U.S., to produce 10–15 ppm diesel fuel will
Europe and Japan and for which be available overseas at competitive We estimate that reducing fuel sulfur
refineries in these areas have already prices. If these refineries were operating to 500 ppm would reduce engine wear
invested in hydrotreating capacity. It well below capacity, they might be and oil degradation to the existing
appears to be less valid when assessing willing to supply complying product at nonroad diesel equipment fleet and that
the relative cost of meeting lower sulfur prices which only reflect incremental a further reduction to 15 ppm sulfur
standards for NRLM fuels and heating operating costs. This could hold prices would result in even greater reductions.
oils which are currently at much higher down in areas where importing fuel is This reduction in wear and oil
sulfur levels in the U.S., Europe and economical. However, it is unlikely that degradation would provide a dollar
Japan. All refineries face additional these refiners could supply sufficient savings to users of nonroad equipment.
investments to remove sulfur from these volumes to hold prices down The cost savings would also be realized
fuels and so face roughly comparable nationwide. Despite this expectation, to by the owners of future nonroad engines
control costs on a per gallon basis. be conservative, in the refining cost that are subject to the standards in this
One factor arguing for competitively analysis conducted earlier in this proposal. As discussed below, these
priced imports is the fact that refinery chapter, we assumed no imports of 500 maintenance savings have been
utilization rates are currently higher in ppm or 15 ppm NRLM diesel fuel. All conservatively estimated to be greater
the U.S. and Europe than in the rest of 500 ppm and 15 ppm NRLM fuel was than 3 cents per gallon for the use of 15
the world. The primary issue is whether produced by domestic refineries. This ppm sulfur fuel when compared to the
overseas refiners will invest to meet raised the average and maximum costs use of today’s unregulated nonroad
tight sulfur standards for U.S., European of 500 ppm and 15 ppm NRLM diesel diesel fuel. A summary of the range of
and Japanese markets. Many overseas fuel and increased the potential price benefits from the use of low-sulfur fuel
refiners will not invest, instead focusing impacts projected above beyond what is presented in Table VI.B–1.219
TABLE VI.B– 1.— ENGINE COMPONENTS POTENTIALLY AFFECTED BY LOWER SULFUR LEVELS IN DIESEL FUELa
Affected components Effect of lower sulfur Potential impact on engine system
Piston Rings ...................................................... Reduced corrosion wear .................................. Extended engine life and less frequent re-
builds.
Cylinder Liners ................................................... Reduced corrosion wear .................................. Extended engine life and less frequent re-
builds.
Oil Quality .......................................................... Reduced deposits, reduced acid build-up, and Reduce wear on piston ring and cylinder liner
less need for alkaline additives. and less frequent oil changes.
Exhaust System (tailpipe) .................................. Reduced corrosion wear .................................. Less frequent part replacement.
Exhaust Gas Recirculation System ................... Reduced corrosion wear .................................. Less frequent part replacement
Notes: a The degree to which all of these benefits may occur for any specific engine will vary. For example, the impact of high sulfur fuel on
piston rings, cylinder liners and oil quality are somewhat interdependent. To the extent an end-user lengthens the oil drain interval, the benefit of
the low sulfur fuel on piston ring and cylinder liner wear will be lessened (though not eliminated). For users who do not alter oil drain intervals,
the benefit of low sulfur fuel on extending piston ring and cylinder liner wear will be greater. The benefit of low sulfur fuel on reducing exhaust
system and EGR system corrosion are independent of oil drain intervals.
The monetary value of these benefits maintenance practices and the degree to quite small. However, for equipment
over the life of the equipment will which equipment operators change produced in the years immediately
depend upon the length of time that the engine maintenance patterns to take preceding the introduction of 500 ppm
equipment operates on low-sulfur diesel advantage of these benefits. For sulfur fuel, the savings would be
fuel and the degree to which engine and equipment near the end of its life in the substantial. Additional savings would
equipment manufacturers specify new 2008 time frame, the benefits will be
219 See Heavy-duty 2007 Highway Final RIA, Diesel Fuel Sulfur Content on Engine Wear,’’ EPA
218 ‘‘Cost of Diesel Fuel Desulfurization In Asian
Refineries,’’ Estrada International Ltd., for the Asian Chapter V.C.5, and ‘‘Study of the Effects of Reduced report # 460/3–87–002, June 1987.
Development Bank, December 17, 2002.
be realized in 2010 when the 15 ppm 2010 nonroad equipment users can gallon savings is conservative as it only
sulfur fuel would be introduced. realize an operating cost savings of 3.2 accounts for the impact of low sulfur
We estimate the single largest savings cents per gallon compared to today’s fuel on oil change intervals. While some
would be the impact of lower sulfur fuel engine. This means that the end cost to of these benefits are impacted by
on oil change intervals. The RIA the typical user for 15 ppm sulfur fuel changes in oil change interval, a number
presents our analysis for the oil change is approximately 3.8 cents per gallon are independent and not included in
interval extension which would be (7.0 cent per gallon cost for fuel minus our cost savings estimate.
realized by the introduction of 500 ppm 3.2 cent per gallon maintenance
sulfur fuel in 2007, as well as the C. Engine and Equipment Cost Impacts
savings). For a typical 100 horsepower
additional oil extension which would be nonroad engine this represents a net The following sections briefly discuss
realized with the introduction of 15 present value lifetime savings, the various engine and equipment cost
ppm sulfur nonroad diesel fuel in 2010. excluding the higher fuel costs, of more elements considered for this final rule
As explained in the RIA, these estimates than $500. and present the total costs we have
are based on our analysis of publically These savings will occur without estimated. The reader is referred to the
available information from nonroad additional new cost to the equipment RIA for a complete discussion.
engine manufacturers. Due to the wide owner beyond the incremental cost of Estimated engine and equipment costs
range of diesel fuel sulfur which today’s the low-sulfur diesel fuel, although depend largely on both the size of the
nonroad engines may see around the these savings are dependent on changes piece of equipment and its engine, and
world, engine manufacturers specify to existing maintenance schedules. Such on the technology package being added
different oil change intervals as a changes seem likely given the to the engine to ensure compliance with
function of diesel sulfur levels. We have magnitude of the savings. There are the new Tier 4 standards. The wide size
used this data as the basis for our many mechanisms by which end-users variation (e.g., engines under 4
analysis. Taken together, when could become aware of the opportunity horsepower through engines above 2500
compared to today’s relatively high to extend oil drain intervals. First, it is horsepower) and the broad application
nonroad diesel fuel sulfur levels, we typical practice for engine and variation (e.g., lawn equipment through
estimate the use of 15 ppm sulfur fuel equipment manufacturers to issue large mining trucks) that exists in the
will enable an oil change interval service bulletins regarding lubrication nonroad industry makes it difficult to
extension of 35 percent from today’s and fueling guidance for end-users.220 present here an estimated cost for every
products. Manufacturers provide these service possible engine and/or piece of
We received comments on our bulletins to equipment dealerships and equipment. Nonetheless, for illustrative
estimated maintenance savings large equipment customers (such as purposes, we present some examples of
primarily from a number of end-user rental companies). In addition, the engine and equipment cost impacts
groups (e.g., equipment dealers, equipment and end-user industries have throughout this discussion. Note that
equipment rental organizations, farming a number of annual conferences which the costs presented here are for those
organizations). Several commenters are used to share information, including nonroad engines and equipment that are
believed our estimates were too high, information regarding appropriate mobile nonroad equipment and are,
and one commenter believed the engine and equipment maintenance therefore, subject to nonroad engine
estimate was too low. However, all of practices. The end-user conferences are standards. These costs would not apply
the commenters who believed our cost also designed to help specific industries for that equipment that is stationary—
savings estimates were too high and business reduce operating costs and some portion of some equipment
provided no data to support their maximize profits, which would include segments such as generator sets, pumps,
comments, beyond unsubstantiated information on equipment maintenance compressors—and not subject to
opinions, nor did they comment on practices. There are trade journals and nonroad engine standards. The analysis
EPA’s substantial related technical publications which provide information summarized here is presented in detail
analysis. and advice to their users regarding in chapter 6 of the RIA.
The commenter who suggested the proper equipment maintenance. Finally, Note that the costs presented here do
estimates were too low provided an some nonroad users perform routine oil not reflect any savings that are expected
example cost estimate for existing oil sample analysis in order to determine to occur because of the engine ABT
change intervals which, if used in our appropriate oil drain intervals, and in program and/or the equipment
analysis, would have resulted in an some cases to monitor overall engine manufacturer transition program, which
estimated cost savings 4 times EPA’s wear rates in order to determine engine are discussed in sections III.A and B.
estimate. We have not changed our rebuild needs.221 We have not estimated These optional programs have the
estimate based on the comments we the value of the savings from all of the potential to provide significant savings
received. benefits listed in table VI.B–1, and for both engine and equipment
We present here a fuel operating cost therefore we believe the 3.2 cents per manufacturers. As a result, we consider
savings attributed to the oil change our cost estimates to be conservative, in
interval extension in terms of a cents 220 For example, Appendix A of EPA the sense that they likely overstate total
per gallon operating cost. We estimate Memorandum ‘‘Estimate of the Impact of Low engine and equipment costs.
that an oil change interval extension of Sulfur Fuel on Oil Change Intervals for Nonroad
Diesel Equipment’’ contains a service bulletin from
In general, the final engine and
31 percent, as would be enabled by the a nonroad diesel engine manufacturer. Copy of equipment cost analysis is the same as
use of 500 ppm sulfur fuel in 2007, memo available in EPA Air Docket A–2001–28, that done for our proposal. We have
results in a fuel operating costs savings item II–A–194. made the following changes:
• In response to a comment, we have
221 For example, Appendix C of EPA
of 2.9 cents per gallon for the nonroad
Memorandum ‘‘Estimate of the Impact of Low
fleet. We estimate an additional cost Sulfur Fuel on Oil Change Intervals for Nonroad increased our engine research and
savings of 0.3 cents per gallon for the oil Diesel Equipment’’, which indicates Caterpillar development (R&D) costs. In the
change interval extension which would recommends owners use Scheduled Oil Sampling proposal, we estimated the R&D
analysis as the best means for users to determine
be enabled by the use of 15 ppm sulfur appropriate oil change intervals. Copy of memo
expenditure that each engine
beginning in 2010. Thus, for the available in EPA Air Docket A–2001–28, item II–A– manufacturer would make to comply
nonroad fleet as a whole, beginning in 194. with the Tier 4 standards. In response
to the comment, we have refined that particulate filter (CDPF). This has no are not attributable to the Tier 4 rule.
analysis and increased our estimate of impact on the redesign costs of other Our assessment at proposal is consistent
engine R&D by roughly 50 percent. We equipment. Lastly, we have decreased with our projections in the Tier 2/3
did not receive any other comments the equipment variable costs for engines rulemaking where we estimated costs
with respect to our estimates for engine above 750 horsepower for the same for electronic fuel injection systems as
R&D. reason as was done for engine variable a cost of complying with those
• Because the final standards for costs. standards. In the preamble to the
engines above 750 horsepower have • We have changed the engine proposed Tier 4 rule, we presented
changed from the proposed standards, operating costs for engines above 750 estimates of the penetration of various
we have made changes to the engine horsepower to reflect a different fuel engine technologies into several power
R&D expenditures attributed to those economy impact than was associated ranges, including 75 to 100 horsepower,
engines. For costing purposes, the NOX with the proposed standards and to based on engine manufacturers’ 2001
portion of the engine R&D expenditures reflect the new timing for adding the model year certification data. See 68 FR
are no longer shared by engines above CDPF and therefore incurring the 28386, May 23, 2003. Since then, model
750 horsepower. This increases NOX maintenance costs associated with it. year certification data for 2004 are
R&D attributed to other engines because • We have included costs for available, and these data substantiate
a significant portion of engine R&D costs additional cooling on engines adding our earlier prediction. These model year
are costs shared across a wide range of cooled EGR systems (engines of 25 to 50 2004 data represent implementation of
products. We have also reduced the horsepower and greater than 750 the Tier 2 standards so these data
engine variable costs for engines above horsepower). These costs include the illustrate the technologies engine
750 horsepower since we are no longer larger radiator and/or engine cooling fan manufacturers are using to comply with
projecting that NOX adsorbers will be that may be required on engines those standards. These data show that
added to them.222 This has no impact on expected to add cooled EGR to meet the nearly 20 percent of the engines that
the engine variable costs for other new standards. In the proposal, we had will be produced in this power range
engines. We have also reduced the estimated the costs for the EGR system will have electronically controlled fuel
equipment redesign costs for engines but not the costs for additional cooling. systems, while the model year 2001 data
above 750 horsepower since less • We have expressed all costs in 2002 show no engines in this power range
redesign effort is projected to dollars for the final rule rather than the had electronic fuel systems. This
accommodate only a catalyzed diesel proposal’s use of 2001 dollars. dramatic increase in electronics as a
We received comments on other result of the Tier 2 standards, let alone
222 In order to avoid inconsistencies in the way aspects of the proposed engine and the Tier 3 standards, gives us
our emission reductions, and cost-effectiveness equipment cost analysis that are not confidence that our projections
estimates are calculated, our cost methodology for reflected in the final analysis. Some of
engines and equipment relies on the same regarding 2012 are reasonable. Section
projections of new nonroad engine growth as those
the comments were: 4.1.4 of the RIA contains a detailed
used in our emissions inventory projections. Our • Some commenters claimed that we discussion of this information; see also
NONROAD emission inventory model includes had underestimated costs for engines the discussions in sections II.B.4.b.i and
estimates of future engine populations that are under 75 horsepower, and in the 75 to II.B.5 above. Thus, we continue to
consistent with the future engine sales used in our 100 horsepower range. For the engines
cost estimates. The NONROAD model inputs believe that we have properly attributed
include an estimate of what percentage of generator under 75 horsepower, one commenter costs of electronic fuel systems to the
sets sold in the U.S. are ‘‘mobile’’ and, thus, subject suggested the costs were higher than Tier 3 rule, or, put another way, that the
to the nonroad standards, and what percentage are EPA estimated. Please see section 5.4.1 cost of an electronic fuel system is not
‘‘stationary’’ and not subject to the nonroad of the Summary and Analysis of
standards. These percentages vary by power a cost attributable to this Tier 4 rule for
category and are documented in ‘‘Nonroad Engine Comments for a detailed discussion of engines in the 75 to 100 horsepower
Population Estimates,’’ EPA Report 420–P–02–004, the comments and our response. In the category. Since the cost of electronic
December 2002. For generator sets above 750 75 to 100 horsepower range, one fuel systems is the essential difference
horsepower, NONROAD assumes 100 percent are commenter suggested that we were
stationary and, therefore, not subject to the new in the costs we attribute to the Tier 4
nonroad standards. For generator sets under 750 incorrect in our assumption that those rule for these engines versus the costs
horsepower, we have assumed other percentages of engines would have electronic fuel the commenter would attribute, we
mobile versus stationary. During our discussions systems in the NRT4 baseline case, therefore disagree with the comment
with engine manufacturers after the proposal, it maintaining the electronic fuel systems
became apparent not only that our estimate for and believe our estimates to be
generator sets above 750 horsepower may not be would have to be added to these engines reasonable. See also section II.A.5
correct and many are indeed mobile, but also that to comply with the Tier 4 standards above.
some of our estimates for generator sets above 750 and, therefore, are a cost of the Tier 4 • One commenter took exception to
horsepower may also not be correct and many more rule. From this premise, the commenter
than we estimate may indeed be mobile. If true, this
our method of amortizing fixed costs
increased percentage of mobile generator sets will argued that the costs for 75 to 100 over a period of years following
be subject to the new nonroad standards. horsepower engines will be implementation of the new standards.
Unfortunately, we have not received sufficient data disproportionately high. The commenter suggested that we used
to make a conclusive change to the NONROAD We disagree. In the proposal, we
model to include the potentially increased
such a method to imply to the regulated
percentages of mobile generator sets and, therefore,
estimated that by 2012, engines in this industries that they would not only
for the above described purpose of maintaining power range would already have recover their investments but would
consistency, we have not included their costs or electronic fuel injection systems. This also make a gain on those investments.
their emissions reductions in our official estimates estimate was based on our engineering This is not the case. We use this method
for this final rule (costs and emissions reductions
for the current percentages in the NONROAD model
assessment of what technologies would of amortization, briefly described here
are included in our estimates for the final rule). be required to comply with the Tier 2 and more fully in the RIA, only to
Instead, we present a sensitivity analysis in Chapter and Tier 3 emission standards, as well reflect the time value of money so that
8 of the RIA that includes both an estimate of the as technical discussions we had with we can get a more accurate estimate of
costs and emissions reductions that would result
from including a higher percentage of generator sets
engine manufacturers regarding future the cost to the companies.
as mobile equipment and subject to the new product plans. Therefore, the costs of The Summary and Analysis of
standards. these electronic fuel injection systems Comments document contains the
details of all comments and our engine research laboratories conducting a systems approach. The NOX adsorber
responses. relevant R&D. technology in particular is expected to
We project the use of several benefit from re-optimization of the
1. Engine Cost Impacts technologies for complying with the engine management system to better
Estimated engine costs are broken into Tier 4 emission standards. We are match the NOX adsorber’s performance
fixed costs (for research and projecting that NOX adsorbers and characteristics. The majority of the
development, retooling, and catalyzed diesel particulate filters dollars we have estimated for research
certification), variable costs (for new (CDPFs) will be the most likely is expected to be spent on developing
hardware and assembly time), and life- technologies applied by industry to this synergy between the engine and
cycle operating costs. Total operating meet our new emissions standards for NOX exhaust emission control systems.
costs include the estimated incremental engines above 75 horsepower. The fact Therefore, for engines where we project
cost for low-sulfur diesel fuel, any that these technologies are being use of both a CDPF and a NOX adsorber
expected increases in maintenance costs developed for implementation in the (i.e., 75 to 750 horsepower), we have
associated with new emission control highway market before the Tier 4 attributed two-thirds of the R&D
devices, any costs associated with implementation dates, and the fact that expenditures to NOX control, and one-
engine manufacturers will have several third to PM control.
increased fuel consumption, and any
years before implementation of the Tier As we mentioned earlier, we have
decreases in operating cost (i.e.,
4 standards, ensures that the further refined our estimate of engine
maintenance savings) expected due to
technologies used to comply with the R&D costs since our proposal. We have
low-sulfur fuel. Cost estimates
nonroad standards will undergo taken these R&D costs and have broken
presented here represent an expected
significant development before reaching them into two components. The first of
incremental cost of engines in the model
production. This ongoing development these components estimates the
year of their introduction. Costs in
could lead to reduced costs in three corporate R&D applicable across all
subsequent years will be reduced by
ways. First, we expect research will lead engine lines. The second of these
several factors, as described below. All
to enhanced effectiveness for individual estimates the engine line by engine line
engine and equipment costs are technologies, allowing manufacturers to R&D cost. The estimates of line by line
presented in 2002 dollars since use simpler packages of emission R&D correlate to power range—$1
producer price indexes for 2003 were control technologies than we would million for under 75 horsepower engine
not available in time for use in this predict given the current state of lines, $3 million for 75 to 750
analysis. development. Similarly, we anticipate horsepower engine lines, and $6 million
a. Engine Fixed Costs that the continuing effort to improve the for above 750 horsepower engine lines.
emission control technologies will We estimated these expenditures based
i. Engine and Emission Control Device
include innovations that allow lower- on the confidential information
R&D cost production. Finally, we believe that provided by the commenter and our
The technologies described in Section manufacturers will focus research analysis of that information. The end
II represent those technologies we efforts on any drawbacks, such as fuel result is consistent with the
believe will be used to comply with the economy impacts or maintenance costs, commenter’s suggested expenditure
Tier 4 emission standards. For many in an effort to minimize or overcome levels. We have applied these engine-
manufacturers, these technologies are any potential negative effects. line R&D estimates only where CDPFs
part of an ongoing research and We anticipate that, in order to meet and/or CDPF/NOX adsorber systems are
development effort geared toward the Tier 4 standards, industry will expected to be implemented (i.e., this
compliance with the 2007 heavy-duty introduce a combination of primary R&D is not applied for the under 75
diesel highway emission standards. The technology upgrades. Achieving very horsepower engines in 2008 because the
engine manufacturers making R&D low NOX emissions will require basic R&D already estimated for complying
research on NOX exhaust emission with those standards should not require
expenditures toward compliance with
control technologies and improvements the same effort to tailor it to each
highway emission standards will have
in engine management to take advantage engine). We have also applied these
to undergo some additional R&D effort
of the new exhaust emission control estimates only for those engines without
to transfer emission control technologies
system capabilities. The manufacturers a highway counterpart (note that only
to engines they wish to sell into the
are expected to address the challenge by 16 of a total 133 nonroad engine lines
nonroad market. These R&D efforts will
optimizing the engine and new exhaust had a highway counterpart).
allow engine manufacturers to develop
emission control system to realize the In the 2007 HD highway rule, we
and optimize these new technologies for
best overall performance. This will estimated that each engine manufacturer
maximum emission-control
entail optimizing the engine and would expend $36.1 million for R&D to
effectiveness with minimum negative emission control system for both
impacts on engine performance, redesign their engines and apply
emissions and fuel economy catalyzed diesel particulate filters
durability, and fuel consumption. performance in light of the presence of (CDPF) and NOX adsorbers.223 For their
Many nonroad engine manufacturers the new exhaust emission control nonroad R&D efforts on engines where
are not part of the ongoing R&D effort devices and their ability to control we project that compliance will require
toward compliance with highway pollutants previously controlled only CDPFs and NOX adsorbers (i.e., 75 to
emissions standards because they do not via in-cylinder means or with exhaust 750 horsepower) and on greater than
sell engines into the highway market. gas recirculation. Since most research to 750 horsepower engines requiring a
Nonetheless, these manufacturers are date with exhaust emission control CDPF, engine manufacturers that also
expected to benefit from the R&D work technologies for nonroad applications sell into the highway market will incur
that has already occurred and will has focused on retrofit programs which some level of R&D effort but not at the
continue through the coming years typically add an exhaust emission
through their contact with highway control device without making engine 223 In the 2007 rule, we estimated a value of $35
manufacturers, emission control device control changes, there remains room for million in 1999 dollars. Here we have adjusted that
manufacturers, and the independent significant improvements by taking such value to express it in 2002 dollars.
level incurred for the highway rule. In different for each manufacturer—some with the phase-in of the standard. All
many cases, the engines used by higher, some lower—depending on R&D expenditures are then recovered by
highway manufacturers in nonroad product mix and the number of engine the engine manufacturer over an
products are based on the same engine lines in their product line. identical time span following the
platform as those used in highway For those engine manufacturers introduction of the technology, with the
products. However, horsepower and selling smaller engines that we project exception that expenditures for DOC-
torque characteristics are often different will add a CDPF-only (i.e., 25 to 75 only R&D are recovered over a five year
so some effort will have to be expended horsepower engines in 2013), we have span rather than a four year span. We
to accommodate those differences. For estimated that the average R&D they will assume an opportunity cost of capital of
these manufacturers, we have estimated incur will be roughly one-third that seven percent for all R&D. We have
that they will incur an average R&D incurred by manufacturers conducting apportioned these R&D costs across all
expense of $3.6 million 224 not CDPF/NOX adsorber R&D. We believe engines that are expected to use these
including the nonroad engine line R&D this is a good estimate because CDPF technologies, including those sold in
noted above. This $3.6 million R&D technology is further along in its other countries or regions that are
expense will allow for the transfer of development than is NOX adsorber expected to have similar standards. We
R&D knowledge from their highway technology and, therefore, a 50/50 split have estimated the fraction of the U.S.
experience to their nonroad engine is not appropriate. Using this estimate, sales to this total sales at 42 percent.
product line. For the reasons stated the R&D incurred by manufacturers that Therefore, we have attributed this
above, two-thirds of this R&D is already have been selling any engines amount to U.S. sales. Note that all
attributed to NOX control and one-third into both the highway and the nonroad engine R&D costs for engines under 25
to PM control for 75 to 750 horsepower markets will be $1.2 million not horsepower have been attributed to U.S.
engines; for engines above 750 including their nonroad engine line sales since other countries are not
horsepower, all of this R&D is attributed R&D, and the R&D for manufacturers expected to have similar standards on
to PM control. selling engines into only the nonroad these engines.
For those manufacturers that sell market will be roughly $8.3 million 226 Using this methodology, we have
larger engines only into the nonroad not including their nonroad engine line estimated the total R&D expenditures
market, and where we project those R&D. All of this R&D is attributed to PM attributable to the new standards at
engines will add a CDPF and a NOX control. $323 million with $206 million spent on
adsorber (75 to 750 horsepower) or a For those engine manufacturers corporate R&D and $118 million spent
CDPF-only (above 750 horsepower), we selling engines that we project will add on engine line R&D. For comparison,
believe that they will incur an R&D only a DOC or make some engine-out our proposal estimated $199 million for
expense nearing that incurred by modifications (i.e., engines under 75 basic R&D and none for engine line
highway manufacturers for the highway horsepower in 2008), we have estimated R&D. The amount for corporate R&D is
rule although not quite at the same that the average R&D they will incur higher here solely due to the change to
level. Nonroad manufacturers will be will be roughly one-half the amount 2002 dollars.
able to learn from the R&D efforts estimated for their CDPF-only R&D.
already underway for both the highway Using this estimate, the R&D incurred ii. Engine-Related Tooling Costs
rule and for the Tier 2 light-duty by manufacturers selling any engines Once engines are ready for
highway rule (65 FR 6698, February 10, into both the highway and nonroad production, new tooling will be
2000). This learning could be done via markets will be roughly $600,000, and required to accommodate the assembly
seminars, conferences, and contact with the R&D for manufacturers selling of the new engines. We have indicated
highway manufacturers, emission engines into only the nonroad market below where our tooling cost estimates
control device manufacturers, and the will be roughly $4.2 million.227 All of have changed from the proposal. In the
independent engine research this R&D is attributed to PM control. 2007 highway rule, we estimated
laboratories conducting relevant R&D. We have assumed that all R&D approximately $1.65 million per engine
Therefore, for these manufacturers, we expenditures occur over a five year span line for tooling costs associated with
have estimated an average expenditure preceding the first year any emission CDPF/NOX adsorber systems.228 For the
of $25.3 million 225 not including the control device is introduced into the nonroad Tier 4 standards, we have
nonroad engine line R&D noted above. market. There is one exception to this estimated that nonroad-only
This lower number—$25.3 million assumption in that the expenditures for manufacturers will incur the same $1.65
versus $36.1 million in the highway DOC-only R&D are assumed to occur million per engine line requiring a
rule—reflects the transfer of knowledge over the four year span between the CDPF/NOX adsorber system and that
to nonroad manufacturers that will final rule and the 2008 standards. these costs will be split evenly between
occur from the many stakeholders in the Where a phase-in exists (e.g., for NOX NOX control and PM control. For those
diesel industry. Two-thirds of this R&D standards on 75 to 750 horsepower systems requiring only a CDPF, we have
is attributed to NOX control and one- engines), expenditures are assumed to estimated one-half that amount, or
third to PM control. occur over the five year span preceding $825,000 per engine line. For those
Note that the $3.6 million and $25.3 the first year NOX adsorbers will be systems requiring only a DOC or some
million estimates represent our estimate introduced, and then to continue during engine-out modifications, we have
of the average R&D expected by the phase-in years. The expenditures applied a one-half factor again, or
manufacturers to gain knowledge about will be incurred in a manner consistent $412,500 per engine line. Tooling costs
the anticipated emission control for CDPF-only and for DOC engines are
devices. These estimates will be 226 In the proposal, we estimated values of $1.2
attributed solely to PM control. None of
million and $8 million in 1999 dollars. Here we
224 In the proposal, we estimated a value of $3.5 have adjusted those values to express them in 2002
these estimates have changed since our
million in 1999 dollars. Here we have adjusted that dollars. proposal, with the exception of being
value to express it in 2002 dollars. 227 In the proposal, we estimated values of
225 In the proposal, we estimated a value of $24.5 $600,000 and $4 million in 1999 dollars. Here we 228 In the 2007 rule, we estimated a value of $1.6
million in 1999 dollars. Here we have adjusted that have adjusted those values to express them in 2002 million in 1999 dollars. Here we have adjusted that
value to express it in 2002 dollars. dollars. value to express it in 2002 dollars.
expressed in 2002 dollars. We received to meet the 2011 standards. We have for engines above 750 horsepower. For
no comments on our tooling cost estimated this amount at ten times the the final rule, we have tripled the costs
estimates. amount for 25 to 50 horsepower associated with new test procedures.
For those manufacturers selling into engines, or $413,000 per engine line. Because we are not finalizing transient
both the highway and nonroad markets, This cost was not in the proposal since test procedures for engines above 750
we have estimated one-half the baseline NOX adsorbers were being projected for horsepower, comments about the cost of
tooling cost, or $825,000, for those engines above 750 horsepower. We have these engines certifying using the
engine lines requiring a CDPF/NOX applied this tooling to all engine lines transient test are now moot.
adsorber system. We believe this is above 750 horsepower, regardless of Manufacturers will incur more than
reasonable since many nonroad engines what markets into which a manufacturer the normal level of certification costs
are produced on the same engine line sells, since such engines clearly have no during the first few years of
with their highway counterparts. For highway counterpart. For the purpose of implementation because engines will
such lines, we believe very little to no allocating costs, we have attributed this need to be certified to the new emission
tooling costs will be incurred. For cost entirely to NOX control. Note that standards using new test procedures (at
engine lines without a highway there is a new 2011 PM standard for least in some instances). Consistent with
counterpart, something approaching the engines above 750 horsepower. our recent standard setting regulations,
$1.65 million tooling cost is applicable. However, we believe that PM standard we have estimated engine certification
For this analysis, we have assumed a could be met via engine-out control costs at $60,000 per new engine
50/50 split of engine product lines for which would result in no new tooling certification to cover existing testing
highway manufacturers and, therefore, a costs associated with that standard. and administrative costs.229 The
50 percent factor applied to the $1.65 We have applied all the above tooling $60,000 certification cost per engine
million baseline. These tooling costs costs to all manufacturers that appear to family was used for 25 to 75 horsepower
will be split evenly between NOX actually make engines. We have not engines certifying to the 2008 standards.
control and PM control. For engine lines eliminated joint venture manufacturers For 25 to 75 horsepower engines
under 75 horsepower and above 750 because these manufacturers will still certifying to the 2013 standards, and for
horsepower, we have used the same need to invest in tooling to make the 75 to 750 horsepower engines certifying
tooling costs as the nonroad-only engines even if they do not conduct any to their new standards, we have added
manufacturers because these engines R&D. We have assumed that all tooling costs to cover the new test procedures
tend not to have a highway counterpart. costs are incurred one year in advance for nonroad diesel engines (e.g., the
Therefore, for those engine lines of the new standard and are recovered transient test, the NTE); 230 these costs
requiring only a CDPF (i.e., those over a five year period following are estimated at $31,500 per engine
between 25 and 75 horsepower and implementation of the new standard; all family.231 For engines under 25
those above 750 horsepower), we have tooling costs include a capital horsepower, we have assumed (for cost
estimated a tooling cost of $825,000. opportunity cost of seven percent. As purposes) that all engines will certify to
Note that this is a change from the done for R&D costs, we have attributed the transient test and the NTE in 2008.
proposal for engines above 750 a portion of the tooling costs to U.S. We believe manufacturers may choose
horsepower; the proposal used the full sales and a portion to sales in other to do this rather than certifying all
$1.65 million since both a CDPF and a countries expected to have similar engines again in 2013 when the
NOX adsorber were being projected. The levels of emission control. Note that all transient test and NTE requirements
tooling costs for DOC and/or engine-out engine tooling costs for under 25 actually begin for those engines. This
engine lines has also been estimated to horsepower engines have been assumption results in higher
be $412,500. Tooling costs for CDPF- attributed to U.S. sales since other certification costs in 2008 than if these
only and for DOC engines are attributed countries are not expected to have engines certified only to the steady-state
solely to PM control. With the exception similar standards on these engines. standard. However, we believe
of the greater than 750 horsepower More information is contained in manufacturers may choose to do this
change, none of these tooling estimates chapter 6 of the RIA. because it would avoid the need to
have changed since our proposal, with Using this methodology, we estimate
the exception of being expressed in the total tooling expenditures 229 In the proposal we added a certification fee to
2002 dollars. attributable to the new Tier 4 standards this cost. In the final rule we have not included the
certification fee because that cost will be accounted
We expect engines in the 25 to 50 at $74 million. For comparison, our for in the certification fees rulemaking (see 67 FR
horsepower range to apply EGR systems proposal estimated $67 million. The 51402 for the proposed rule). Including in the
to meet the Tier 4 NOX standards for higher value here is a result of: proposal was essentially double counting that fee.
2013. For these engines, we have Expressing values in 2002 dollars rather Similarly, if we were to include it in this final rule,
we would be double counting that fee.
included an additional tooling cost of than 2001 dollars; attributing all under 230 Note that the transport refrigeration unit (TRU)
$41,300 per engine line, consistent with 25 horsepower tooling costs to U.S. test cycle is an optional duty cycle for steady-state
the EGR-related tooling cost estimated sales while the proposal attributed 42 certification testing specifically tailored to the
for 50–100 horsepower engines in our percent of those costs to U.S. sales; and, operation of TRU engines. Likewise, the ramped
Tier 2/3 rulemaking. The EGR tooling modal cycles are available test cycles that can be
above 750 horsepower tooling is slightly used to replace existing steady-state test
costs are applied equally to all engine higher because of the proposal’s phase- requirements for nonroad constant-speed engines,
lines in that horsepower range in (50/50/50/100) of one set of standards generally. Manufacturers of these engines who opt
regardless of the markets into which the while the final rule has two sets of to use one of these test cycles would incur no new
manufacturer sells. We have applied costs above those estimated here and may incur less
standards. cost.
this tooling cost equally because engines 231 Note that the proposal incorrectly used a value
in this horsepower range tend not to iii. Engine Certification Costs
of $10,500 for costs associated with the new test
have highway counterparts. Tooling The comments we received with procedures. Here, we have corrected this error by
costs for EGR systems are attributed respect to our estimated certification using a value of $31,500. Note also that the proposal
erroneously did not include certification costs
solely to NOX control. costs noted that we had underestimated associated with transient testing and the NTE for
We have also estimated some tooling costs associated with new test engines under 25 horsepower. We have corrected
costs for engines above 750 horsepower procedures, especially transient testing that error in the final analysis.
recertify all engines under 25 program (or the TPEM program) since it technology packages for T2/3, and those
horsepower again in 2013. These is so difficult to predict how this packages included the things equipment
certification costs—whether it be the program will be used. Furthermore, we manufacturers are claiming will not be
$60,000 or the $91,500 per engine must remain consistent throughout our present in the Tier 4 baseline. As a
family—apply equally to all engine cost analysis so that, if we estimated result, we have already considered the
families for all manufacturers regardless certification costs based on use of the costs associated with reaching our Tier
of into what markets the manufacturer ABT program, we should also base 4 baseline engine configurations in the
sells. For engines above 750 engine variable costs and equipment context of the T2/3 rule.
horsepower, the certification costs used variable costs on use of the ABT We have made changes to engine
were $87,000 per family since these program. Doing so, we believe, would variable costs to remain consistent with
engines will not be certifying over the decrease engine variable costs since that the final program—i.e., we have
new transient test procedure. We have is the primary reason manufacturers changed our greater than 750
applied these certification costs to all choose to make use of the ABT program. horsepower cost estimates since the
U.S. sold engine families and then Since engine variable costs, as discussed final standards differ from those that
spread the total over U.S. sales. In other below, are a much greater fraction of the were proposed. We have also changed
words, we have not presumed that overall program costs, we believe that the costs by expressing them in 2002
certification conducted for U.S. engines we are being conservative by generating dollars rather than 2001 dollars.232
would fulfill the certification our costs based on use of the phase-in. i. NOX Adsorber System Costs
requirements of other countries and Therefore, we believe that use of the
have, therefore, not spread total costs ABT program (and the TPEM program) The NOX adsorber system that we are
over engine sales outside the U.S. will provide substantial net savings to anticipating will be used to comply with
Applying these costs to each of the industry even though widespread use of Tier 4 engine standards will be the same
665 engine families as they are certified ABT might cause certification costs to as that used for highway applications. In
to a new emissions standard results in be higher. order for the NOX adsorber to function
total costs of $91 million expended properly, a systems approach that
during implementation of the Tier 4 b. Engine Variable Costs includes a reductant metering system
standards. These costs are attributed to This section summarizes the detailed and control of engine A/F ratio is also
NOX and PM control consistent with the analysis presented in chapter 6 of the necessary. Many of the new air handling
phase-in of the new emissions RIA. For our analysis, we have used the and electronic system technologies
standards—where new NOX and PM 2002 annual average costs for platinum developed in order to meet the Tier
standards are introduced together, the and rhodium (the two platinum group 2/3 nonroad engine standards can be
certification costs are split evenly; metals (PGMs) we expect will be used) applied to accomplish the NOX adsorber
where only a new PM standard is because we believe they represent a control functions as well (these costs
introduced, the certification costs are better estimate of the cost for PGM than were accounted for in our T2/3 rule).
attributed to PM only; where a NOX other metrics. In the RIA, we present a Some additional hardware for exhaust
phase-in becomes 100 percent in a year cost sensitivity that estimates the NOX or O2 sensing and for fuel metering
after full implementation of a PM recovery value of precious metals will likely be required. The cost
standard, the certification costs are returned to the open market upon estimates include a DOC for clean-up of
attributed to NOX only. All certification retirement of an aftertreatment device. hydrocarbon emissions that occur
costs are assumed to occur one year We present that analysis to gauge the during NOX adsorber regeneration
prior to the new emission standard and true social cost of these devices when events. We have also estimated that
are then recovered over a five year new. warranty costs will increase due to the
period following compliance with the We have not made any changes to our application of this new hardware.
new standard; all certification costs engine variable costs as a result of Chapter 6 of the RIA contains the details
include a capital opportunity cost of public comments. Some commenters for how we estimated costs associated
seven percent. For comparison, our (engine manufacturers) claimed that we with the new NOX control technologies
proposal estimated certification costs at had underestimated these costs but did required to meet the Tier 4 emission
$72 million. The increase here is a not provide any detailed information standards. These costs are estimated to
result of using a higher cost associated about where they believed we had erred increase engine costs by roughly $670 in
with the new test procedures than was or what they believed the costs should the near-term for a 150 horsepower
used in the proposal. be. Other commenters (emission control engine, and $2,040 in the near-term for
We also received comment that we device manufacturers) claimed that we a 500 horsepower engine. In the long-
should estimate certification costs based had done a fair job with our estimates. term, we estimate these costs to be $550
on use of the ABT program rather than Some commenters (equipment and $1,650 for the 150 horsepower and
based on the phase-in. Doing this would manufacturers) claimed that our 500 horsepower engines, respectively.
result in higher certification costs assumptions with respect to baseline These costs may differ slightly from the
because all engine families would be engine configurations were not accurate. proposal due to the adjustments to 2002
certified in year one of the phase-in and However, as discussed earlier, based on dollars. Note that we have estimated
all families would again be certified in our own engineering judgement and the costs for all engines in all horsepower
the final year of the phase-in. In positive comments of the engine
contrast, since we have based manufacturers—who we consider a 232 Note that the change to 2002 dollars had
certification costs on the phase-in, all better source for such information than different effects on different pieces of hardware. We
have used two different PPI adjustments in the
engine families are certified in year one equipment manufacturers since engine analysis: one for motor vehicle catalytic converters
(PM standards have no phase-in) and manufacturers are the directly affected which was used to adjust costs for DOCs, NOX
only half are again certified in the final entities—we have maintained our adsorbers, and CDPFs; and another for motor
year (the 50 percent not meeting the original assumptions for baseline engine vehicle parts and accessories which was used for all
other pieces of hardware. The former of these
new NOX standard in year one). We configurations. Further, our assumed adjustments actually caused costs to decrease
have chosen not to estimate certification Tier 4 baseline engine configurations are relative to the proposal while the latter caused costs
or any costs based on use of the ABT consistent with our assumed compliant to increase slightly.
ranges, and these estimates are environment. Such engines are said to in fact, some engines below 75
presented in detail in the RIA. have an open crankcase system. We horsepower currently meet the Tier 4
Throughout this discussion of engine project that this requirement to close the PM standard (for 2008) and will not,
and equipment costs, we present costs crankcase on turbo-charged engines will therefore, incur any incremental costs to
for a 150 and a 500 horsepower engine force manufacturers to rely on meet it. We have estimated this added
for illustrative purposes. engineered closed crankcase ventilation hardware to result in an increased
systems that filter oil from the blow-by engine cost of $143 in the near-term and
ii. Catalyzed Diesel Particulate Filter
gases prior to routing them into either $136 in the long-term for a 30
(CDPF) Costs
the engine intake or the exhaust system horsepower engine. These costs may
CDPFs can be made from a wide range upstream of the CDPF. We have differ slightly from the proposal due to
of filter materials including wire mesh, estimated the initial cost of these the adjustments to 2002 dollars.
sintered metals, fibrous media, or systems to be roughly $30 for low We have also projected that some
ceramic extrusions. The most common horsepower engines and up to $90 for engines in the 25 to 75 horsepower
material used for CDPFs for heavy-duty very high horsepower engines. These range will have to upgrade their fuel
diesel engines is cordierite. Here we costs are incurred only by turbo-charged systems to accommodate the CDPF. We
have based our cost estimates on the use engines because today’s naturally have estimated the incremental costs for
of silicon carbide (SiC) even though it aspirated engines already have CCV these fuel systems at roughly $870 for a
is more expensive than other filter systems. These costs may differ slightly three cylinder engine in the 25–50
materials.233 We estimate that the CDPF from the proposal due to the horsepower range, and around $450 for
systems will add $760 to engine costs in adjustments to 2002 dollars. a four cylinder engine in the 50–75
the near-team for a 150 horsepower horsepower range. This difference
engine and $2,710 in the near-term for v. Variable Costs for Engines Below 75 reflects a different base fuel system,
a 500 horsepower engine. In the long- Horsepower and Above 750 Horsepower with the smaller engines assumed to
term, we estimate these CDPF system The Tier 4 program includes have mechanical fuel systems and the
costs to be $580 and $2,070 for the 150 standards for engines under 25 larger engines assumed to already be
horsepower and the 500 horsepower horsepower that begin in 2008, and two electronic. The electronic systems will
engines, respectively. These costs may sets of standards for 25 to 75 incur lower costs because they already
differ slightly from the proposal due to horsepower engines—one set that begins have the control unit and electronic fuel
the adjustments to 2002 dollars. in 2008 and another that begins in pump. Also, we have assumed these
2013.234 The 2008 standards for all fuel changes will occur for only direct
iii. CDPF Regeneration System Costs
engines under 75 horsepower are of injection (DI) engines; indirect injection
Application of CDPFs in nonroad similar stringency and are expected to engines (IDI) are assumed to remain IDI
applications may present challenges result in use of similar technologies (i.e., but to add more hardware as part of
beyond those of highway applications. the possible addition of a DOC). The their CDPF regeneration system to
For this reason, we anticipate that some 2013 standards for 25 to 75 horsepower ensure proper regeneration under all
additional hardware beyond the diesel engines are considerably more stringent operating conditions. Such a
particulate filter itself may be required than the 2008 standards and are regeneration system, described above, is
to ensure that CDPF regeneration expected to force the addition of a CDPF expected to cost roughly twice that
occurs. For some engines this may be along with some other engine hardware expected for DI engines, or around $320
new fuel control strategies that force to enable the proper functioning of that for a 30 horsepower IDI engine versus
regeneration under some circumstances, new technology. More detail on the mix $160 for a DI engine. These costs may
while in other engines it might involve of technologies expected for all engines differ slightly from the proposal due to
an exhaust system fuel injector to inject under 75 horsepower is presented in the adjustments to 2002 dollars.
fuel upstream of the CDPF to provide section II.B.4 and 5. As discussed there, We have also projected that engines in
necessary heat for regeneration under if changes are needed to comply, we the 25–50 horsepower range will add
some operating conditions. We estimate expect manufacturers to comply with cooled EGR to comply with their new
the near-term costs of a CDPF the 2008 standards through either NOX standard in 2013. Additionally, we
regeneration system to be $200 for a 150 engine-out improvements or through the have estimated, for cost purposes, that
horsepower engine and $330 for a 500 addition of a DOC. From a cost engines above 750 horsepower will add
horsepower engine. In the long-term, we perspective, we have projected that cooled EGR to comply with their new
estimate these costs at $150 and $250, engines will add a DOC. Presumably, NOX standard in 2011. This represents
respectively. These costs may differ the manufacturer will choose the least a conservative estimate since we do not
slightly from the proposal due to the costly approach that provides the necessarily anticipate that cooled EGR
adjustments to 2002 dollars. necessary reduction. If engine-out will be applied to all, if any, engines
iv. Closed-Crankcase Ventilation System modifications are less costly than a above 750 horsepower. Nonetheless, we
(CCV) Costs DOC, our estimate here is conservative. do expect some changes to be made
If the DOC proves to be less costly, then (most probably some form of engine-out
Today’s final rule eliminates the our estimate is representative of what emission control) and, consistent with
exemption that allows turbo-charged most manufacturers will do. Therefore, our approach to costing DOCs for
nonroad diesel engines to vent we have assumed that, beginning in engines below 75 horsepower in 2008,
crankcase gases directly to the 2008, all engines below 75 horsepower we have conservatively costed cooled
233 This is particularly true with respect to
add a DOC. Note that this estimate is EGR for engines above 750 horsepower
engines above 750 horsepower where we believe
made more conservative since we have in 2011. We have estimated that the
that manufacturers may in fact use a wire mesh assumed this cost for all engines when, EGR system will add $100 in the near-
substrate rather than the SiC substrate we have term and $70 in the long-term to the
costed and, indeed, we have based the level of the 234 We refer here to PM standards. There also is
cost of a 30 horsepower engine, and
2015 PM standard on this use of wire mesh a NOX+NMHC standard for 25–50 horsepower
substrates (see section II.B.3.b). We have chosen to engines that takes effect in 2013 and is equivalent
$550 and $420, respectively, for engines
remain conservative in our cost estimates by to the Tier 3 NOX+NMHC standard for 50–75 above 750 horsepower. These costs may
assuming use of a SiC substrate for all engines. horsepower engines (see section II.A). differ slightly from the proposal due to
the adjustments to 2002 dollars. To control technologies and low-sulfur existing nonroad engines and
these costs, we have added costs diesel fuel. The technology enabling equipment. We have used a 35 percent
associated with additional cooling that benefits of low-sulfur diesel fuel are increase in oil change interval along
may be needed to reject the heat described in Section II, and the with costs per oil change of $70 through
generated by the cooled EGR system or incremental cost for low-sulfur fuel is $400 to arrive at estimated savings
other in-cylinder technologies. These described in section VI.A. The new associated with increased oil change
costs were not included in the proposal. emission control technologies are intervals.
Such additional cooling might take the themselves expected to introduce These operating costs are expressed as
form of a larger radiator and/or a larger additional operating costs in the form of a cent/gallon cost (or savings). As a
or more powerful cooling fan. Based on increased fuel consumption and result, operating costs are directly
cost estimates from our increased maintenance demands. proportional to the amount of fuel
Nonconformance Penalty rule (67 FR Operating costs are estimated in the RIA consumed by the engine. We have
51464), we have estimated that the costs over the life of the engine and are estimated these operating costs—fuel-
associated with additional cooling will expressed in terms of cents/gallon of related refining and distribution costs,
add $40 in the near-term and $30 in the fuel consumed. In section VI.C.3, we maintenance related costs, and fuel
long-term to the cost of a 30 horsepower present these lifetime operating costs as economy impacts—to be 5.4 cents/
engine, and $710 in the near-term and a net present value (NPV) in 2002 gallon for a 150 horsepower engine and
$560 in the long-term for engine above dollars for several example pieces of 6.5 cents/gallon for a 500 horsepower
750 horsepower. Note that we are also equipment. engine. More detail on operating costs
projecting use of a CDPF for engines can be found in Chapter 6 of the RIA.
Total operating cost estimates include
above 750 horsepower, as was discussed The existing fleet will also benefit
the following elements: the change in
above. from lower maintenance costs due to the
maintenance costs associated with use of low sulfur diesel fuel. The
We believe there are factors that will applying new emission controls to the
cause variable hardware costs to operating costs for the existing fleet are
engines; the change in maintenance discussed in section VI.B. We did
decrease over time, making it costs associated with low sulfur fuel
appropriate to distinguish between near- receive comments with respect to our
such as extended oil change intervals; oil change maintenance savings
term and long-term costs. Research in the change in fuel costs associated with
the costs of manufacturing has estimates. These comments were
the incrementally higher costs for low address in section VI.B. We received no
consistently shown that as sulfur fuel, and the change in fuel costs
manufacturers gain experience in comments on our CDPF and CCV
due to any fuel consumption impacts maintenance costs or our CDPF
production, they are able to apply associated with applying new emission
innovations to simplify machining and regeneration costs.
controls to the engines. This latter cost
assembly operations, use lower cost is attributed to the CDPF and its need 2. Equipment Cost Impacts
materials, and reduce the number or for periodic regeneration which we In addition to the costs directly
complexity of component parts.235 Our estimate may result in a one percent fuel associated with engines that incorporate
analysis, as described in more detail in consumption increase where a NOX new emission controls to meet new
the RIA, incorporates the effects of this adsorber is also applied, or a two standards, costs will increase due to the
learning curve by projecting that the percent fuel consumption increase need to redesign the nonroad equipment
variable costs of producing the low- where no NOX adsorber is applied (refer in which these engines are used. Such
emitting engines decreases by 20 to chapter 6, section 6.2.3.3 of the RIA). redesigns will probably be necessary
percent starting with the third year of Maintenance costs associated with the due to the expected addition of new
production. For this analysis, we have new emission controls on the engines emission control systems, but could also
assumed a baseline that represents such are expected to increase since these occur if the engine has a different shape
learning already having occurred once devices represent new hardware and, or heat rejection rate, or is no longer
due to the 2007 highway rule (i.e., a 20 therefore, new maintenance demands. made available in the configuration
percent reduction in emission control For CDPF maintenance, we have used a previously used. We have accounted for
device costs is reflected in our near-term maintenance interval of 3,000 hours for these potential changes in establishing
costs). We have then applied a single smaller engines and 4,500 hours for the lead time for the Tier 4 emissions
learning step from that point in this larger engines and a cost of $65 through standards. The transition flexibility
analysis. Additionally, manufacturers $260 for each maintenance event. For provisions for equipment manufacturers
are expected to apply ongoing research closed-crankcase ventilation (CCV) that are included in this final rule are
to make emission controls more systems, we have used a maintenance an element of that lead time. These
effective and to have lower operating interval of 675 hours for all engines and flexibility provisions are described in
costs over time. However, because of the a cost per maintenance event of $8 to detail in section III.B.
uncertainty involved in forecasting the $48 for small to large engines. Offsetting In assessing the economic impact of
results of this research, we these maintenance cost increases will be the new emission standards, EPA has
conservatively have not accounted for it a savings due to an expected increase in made a best estimate of the
in this analysis. oil change intervals because low sulfur modifications to equipment that relate
c. Engine Operating Costs fuel will be far less corrosive than is to packaging (installing engines in
We are projecting that a variety of current nonroad diesel fuel. Less equipment engine compartments). The
new technologies will be introduced to corrosion will mean a slower incremental costs for new equipment
enable nonroad engines to meet the new acidification rate (i.e., less degradation) will be comprised of fixed costs (for
Tier 4 emissions standards. Primary of the engine lubricating oil and, redesign to accommodate new emission
among these are advanced emission therefore, more operating hours between control devices) and variable costs (for
needed oil changes. As discussed in new equipment hardware to affix the
235 For example, see, ‘‘Learning Curves in section VI.B, the use of 15 ppm sulfur new emission control devices and for
Manufacturing,’’ Linda Argote and Dennis Epple, fuel can extend oil change intervals by labor to install those emission control
Science, February 23, 1990, Vol. 247, pp. 920–924. as much as 35 percent for both new and devices). Note that the fixed costs do not
include certification costs because the equipment variable costs is not engine manufacturer should have
equipment is not certified to emission sustainable in a competitive market, at limited to no impact on the equipment
standards. The engine is certified by the least on average, and the commenter design. Nonetheless, we have
engine manufacturer; therefore, the provided no data nor study that conservatively estimated their redesign
related certification costs are counted as supported the comment. costs at $53,100 per model.237
an engine fixed cost. We have also We have made minor changes to the A number of equipment
attributed all changes in operating costs proposed numbers to express them in manufacturers have shared detailed
(e.g., additional maintenance) to the cost 2002 dollars and to reflect where the information with us regarding the
estimates for engines. Included in program has changed (i.e., greater than investments made for Nonroad Tier 2
section VI.C.3 is a discussion of several 750 horsepower mobile machines). We equipment redesign efforts, as well as
example pieces of equipment (e.g., skid/ have also attributed all under 25 redesign estimates for significant
steer loader, dozer, etc.) and the costs horsepower redesign costs to U.S. sales changes such as installing a new engine
we have estimated for these specific since we do not expect other countries design. These estimates range from
example pieces of equipment. Full to have similar emission standards for approximately $53,100 for some lower
details of our equipment cost analysis these engines/equipment. Lastly, we powered equipment models to well over
can be found in chapter 6 of the RIA. All have corrected some minor errors made $1 million for high horsepower
costs are presented in 2002 dollars. in the proposal in determining motive equipment with very challenging design
We have made only limited changes versus non-motive models and constraints. We believe that the
relative to the proposal with respect to determining the number of unique equipment redesign efforts undertaken
our estimated equipment costs, as equipment models needing redesign. for the T2/3 are representative of the
discussed below. We did receive We now estimate that a total of over effort that will be required for Tier 4
comment that we underestimated costs 4,500 equipment models will be because the changes needed are the
for equipment redesign and for markups redesigned as compared to the same in nature—increasing available
on equipment variable costs. The proposal’s estimate of just over 4,100 space within the machine to
commenters making these claims equipment models. Further discussion accommodate new hardware. We have
relative to equipment redesign costs of these changes can be found in based our Tier 4 estimates, in part, on
tended to be those that have relative Chapter 6 of the RIA. that industry input and have estimated
high equipment sales volumes. Such that equipment redesign costs will range
a. Equipment Fixed Costs
manufacturers tend to expend levels from $53,100 per model for 25
higher than we estimated in our As we noted in the proposal, the most horsepower equipment up to $796,500
proposal for equipment redesign significant changes anticipated for
per model for 300 horsepower
because they sell into highly equipment redesign are changes to
equipment and above. For mobile
competitive markets and they can accommodate the physical changes to
machines greater than 750 horsepower,
spread costs over many units. However, engines, especially for those engines
we have used a new redesign cost of
some equipment manufacturers we have that add PM traps and NOX adsorbers.
$106,000 associated with the 2011
met with, most notably those with small The costs for engine development and
standards which is consistent in scale
sales volumes, do not appear to expend the emission control devices are
with the estimate used for 25 to 50
nearly the level we estimated in the included as costs to the engines, as
horsepower equipment that add both
proposal. These manufacturers tend to described above. Equipment
EGR and a CDPF in the 2013 timeframe.
sell into markets with few competitors, manufacturers must still incur the effort
and expense of integrating the engine This estimate was not in the proposal.
produce machines by hand, and expend For this larger equipment, we have
less redesign effort relative to a high and emissions control devices into the
piece of equipment. Therefore, we have continued with an estimate of $796,500
sales volume manufacturer.236 Our goal associated with the 2015 standards even
in the proposal was to estimate the allocated extensive engineering time for
this effort. though we project no need to
redesign costs spent by industry (i.e., accommodate a NOX adsorber. We have
the average cost per piece of equipment The costs we have estimated are based
on engine power and whether an attributed only a portion of the
multiplied by all equipment resulting in equipment redesign costs to U.S. sales
an estimated total industry cost), rather application is non-motive (e.g., a
generator set) or motive (e.g., a skid in a manner consistent with that taken
than estimating the maximum cost to be
steer loader). The designs we have for engine R&D costs and engine tooling
spent by any particular manufacturer.
considered to be non-motive are those costs. In addition, we expect
As a result, our equipment redesign
that lack a propulsion system. In manufacturers to incur some fixed costs
estimates per model may be too low for
addition, the new emission standards to update service and operation manuals
some manufacturers, but they are also
for engines rated under 25 horsepower to address the maintenance demands of
too high for others. We believe this cost
and the 2008 standards for 25–75 new emission control technologies and
methodology provides as accurate an
horsepower engines are projected to the new oil service intervals; we
estimate as can be made. We have used
require no significant equipment estimate these service manual updates
the same methodology for the final cost
estimates presented here. redesign beyond that done to to cost between $2,660 and $10,620 per
As for the comments with respect to accommodate the Tier 2 standards. As equipment model.
equipment variable costs, we did indeed explained earlier, we expect that these These equipment fixed costs (redesign
include a markup of 29 percent and engines will comply with the new Tier and manual updates) were then
disagree with the commenter that a two- 4 standards through either engine allocated appropriately to each new
to-one markup would be more modifications to reduce engine-out model to arrive at a total equipment
appropriate. Such a high markup on emissions or through the addition of a fixed cost of $828 million. We have
DOC. We have projected that engine assumed that these costs will be
236 ‘‘Meeting between Staff of Eagle Crusher
modifications will not affect the outer 237 Note that the equipment redesign estimates,
Company, Inc., and EPA,’’ memorandum from Todd dimensions of the engine and that a
Sherwood to Air Docket A–2001–28, Docket Item and all other equipment related costs, have been
IV–E–40, EDOCKET OAR–2003–0012–0868, March DOC will replace the existing muffler. adjusted from the NPRM to express them in 2002
16, 2004. Therefore, either approach taken by the dollars.
recovered over a ten year period with a these new pieces of hardware. For have chosen several example pieces of
seven percent opportunity cost of engines above 75 horsepower—those equipment and have presented the
capital. By comparison, our proposal expected to incorporate CDPF and NOX estimated costs for them. Using these
estimated equipment fixed costs at $698 adsorber technology—the amount of examples, we can calculate the costs for
million. The costs are higher now sheet metal is based on the size of the a specific piece of equipment in several
because of the changes mentioned aftertreatment devices. horsepower ranges and better illustrate
above—expressing costs in 2002 dollars; For equipment of 150 horsepower and the cost impacts of the new standards.
attributing all under 25 horsepower 500 horsepower, respectively, we have These costs along with information
redesign costs to U.S. sales; and, estimated the costs to be roughly $60 to about each example piece of equipment
correcting upward the number of $150. Note that we have estimated costs are shown in table VI.C–1. Costs
equipment models to be redesigned. for equipment in all horsepower ranges,
presented are near-term and long-term
and these estimates are presented in
b. Equipment Variable Costs costs for the final standards to which
detail in the RIA. Throughout this
Equipment variable cost estimates are each piece of equipment will comply.
discussion of engine and equipment
based on costs for additional materials costs, we present costs for a 150 and a Long-term costs are only variable costs
to mount the new hardware (i.e., 500 horsepower engine for illustrative and, therefore, represent costs after all
brackets and bolts required to secure the purposes. fixed costs have been recovered and all
aftertreatment devices) and additional projected learning has taken place.
sheet metal assuming that the body 3. Overall Engine and Equipment Cost Included in the table are estimated
cladding of a piece of equipment (i.e., Impacts prices for each piece of equipment to
the hood) might change to accommodate To illustrate the engine and provide some perspective on how our
the aftertreatment system. Variable costs equipment cost impacts we are estimated control costs relate to existing
also include the labor required to install estimating for the Tier 4 standards, we equipment prices.
TABLE VI.C– 1.— NEAR-TERM AND LONG-TERM COSTS FOR SEVERAL EXAMPLE PIECES OF EQUIPMENT a
($2002, for the final emission standards to which the equipment must comply)
Gen-Set Skid/steer Backhoe Dozer Ag tractor Dozer Off-highway

loader truck
Horsepower 9 hp 76 hp 175 hp 250 hp 503 hp
33 hp 1000 hp
Incremental Engine & Equipment Cost ............... $120 $790 $1,200 $2,560 $1,970 $4,140 $4,670
Long-Term ........................................................ 180 1,160 1,700 3,770 3,020 6,320 8,610
Near-Term.
Estimated Equipment Price when New b ............. 4,000 20,000 49,000 238,000 135,000 618,000 840,000
Incremental Operating Costs c ............................. ¥80 70 610 2,480 2,110 7,630 20,670
Baseline Operating Costs (Fuel & Oil only) c ....... 940 2,680 7,960 27,080 23,750 77,850 179,530
Notes: a Near-term costs include both variable costs and fixed costs; long-term costs include only variable costs and represent those costs that
remain following recovery of all fixed costs. b ‘‘Price Database for New Nonroad Equipment,’’ memorandum from Zuimdie Guerra to EDOCKET
OAR– 2003– 0012– 0960. c Present value of lifetime costs.
More detail and discussion regarding program including those costs incurred control (to 500 ppm and then to 15
what these costs and prices mean from and emissions reductions generated by ppm) for both NR and L&M fuel but
an economic impact perspective can be the existing fleet. The baseline for this without any new nonroad engine
found in section VI.E. evaluation is the existing set of fuel and standards.238 For the first of these
engine standards (i.e., unregulated scenarios, the discussion illustrates the
D. Annual Costs and Cost Per Ton
NRLM fuel and the Tier 2/Tier 3 costs and relative cost effectiveness of
One tool that can be used to assess the program). The 30 year time window the final NRT4 program to other
value of the Tier 4 standards for NRLM chosen is meant to capture both the programs. For the second of these
fuel and nonroad engines is the costs early period of the program when very scenarios, the discussion illustrates the
incurred per ton of emissions reduced. few new engines that meet the new costs and cost effectiveness associated
This analysis involves a comparison of standards will be in the fleet, and the with the fuel program as if implemented
our new program to other measures that later period when essentially all engines as a stand alone program without new
have been or could be implemented. As will meet the new standards. engine standards.
summarized in this section and detailed We have analyzed the cost per ton In sections VI.D.1 and 2, we present
in the RIA, the program being finalized reduced of several different scenarios. the cost of the full NRLM fuel and
today represents a highly cost effective The costs and emissions reductions of nonroad engine program and the cost
mobile source control program for each of these scenarios are presented in per ton of PM, NOX+NMHC, and SO2
reducing PM, NOX, and SO2 emissions. detail in chapter 8 of the RIA. Here, we reductions that will be realized. The
We have calculated the cost per ton of present information of the cost and cost analysis presented in sections VI.D.1
our Tier 4 program based on the net effectiveness for the following two and 2 represents the total Tier 4
present value of all costs incurred and scenarios: (1) The full NRLM fuel and program for nonroad diesel engines and
all emission reductions generated over a nonroad engine program, meaning two NRLM fuel being finalized today. In
30 year time window following steps of fuel control (to 500 ppm and sections VI.D.3 and 4, we summarize the
implementation of the program (i.e., then to 15 ppm) for both NR and L&M 238 We are not analyzing a scenario involving just
calendar years 2007 through 2036). This fuel and all of the nonroad engine the engine standards because the nonroad engine
approach captures all of the costs and standards; and, (2) the NRLM fuel-only standards involving advanced emissions control
emissions reductions from our new program, meaning two steps of fuel technologies require the use of the 15ppm fuel.
cost for the NRLM fuel-only scenario standards for engines less than 75 amortized at seven percent. The figure
and the cost per ton of PM and SO2 horsepower, the 2013 standards for 25 shows that total annual costs are
reductions that would be realized. to 75 horsepower engines, and costs for estimated to be $50 million in the first
the nonroad engine standards for year the new engine standards apply,
1. Annual Costs for the Full NRLM Fuel
engines above 75 horsepower. All increasing to a peak of $2.2 billion in
and Nonroad Engine Program
maintenance and operating costs are 2036 as increasing numbers of engines
The costs of the full NRLM fuel and included along with maintenance become subject to the new nonroad
nonroad engine program include costs savings realized by both the existing standards and an ever increasing
associated with both steps in the NRLM fleet (nonroad, locomotive, and marine) amount of NRLM fuel is consumed. The
fuel program—the NR fuel reduction to and the new fleet of engines complying
500 ppm sulfur in 2007 and to 15 ppm net present value of the annualized
with the Tier 4 standards.
sulfur in 2010 and the L&M fuel Figure VI.D–1 presents these results. costs over the period from 2007 to 2036
reduction to 500 ppm sulfur in 2007 and All capital costs for NRLM fuel is $27 billion using a 3 percent discount
to 15 ppm sulfur in 2012. Also included production and nonroad engine and rate and $14 billion using a 7 percent
are costs for the 2008 nonroad engine equipment fixed costs have been discount rate.
2. Cost per Ton of Emissions Reduced costs according to the pollutants for PM, with that half split 50/50 between
for the Full NRLM Fuel and Nonroad which they are incurred. Where fuel each pollutant). Where fuel changes
Engine Program changes occur in conjunction with new occur without new engine standards on
engine standards (engine standards which fuel changes are premised (i.e.,
We have calculated the cost per ton of enabled by those fuel changes), we 500ppm NRLM fuel and 15ppm L&M
emissions reduced associated with the allocate one-half of the fuel-related costs fuel), we have allocated costs associated
NRT4 engine and NRLM fuel program. to fuel-derived emissions reductions with fuel-derived emissions reductions
The resultant cost per ton numbers (PM and SO2, with one-third of that half one-third to PM and two-thirds to SO2.
depend on how the costs presented allocated to PM and two-thirds to SO2) We have allocated costs associated with
above are allocated to each pollutant. and one-half to engine-derived engine-derived emissions reductions
Therefore, we have carefully allocated emissions reductions (NOX+NMHC and (i.e., engine/equipment costs) directly to
ER29JN04.004</GPH>
the pollutant for which the cost is annual emission reductions through emission reductions that will occur
incurred. These engine and equipment 2036. We have also calculated the cost from the existing fleet (i.e., those pieces
cost allocations are noted throughout per ton of emissions reduced in the year of nonroad equipment that were sold
the discussion in section VI.C, and are 2030 using the annual costs and into the market prior to the new
detailed in full in chapter 8 of the RIA. emissions reductions in that year alone. emission standards). These results are
We have calculated the costs per ton This number represents the long-term shown in Table VI.D–1 using both a
using the net present value of the cost per ton of emissions reduced. The three percent and a seven percent social
annualized costs of the program through cost per ton numbers include costs and discount rate.
2036 and the net present value of the
TABLE VI.D– 1.— TOTAL FUEL AND ENGINE PROGRAM 30 YEAR AGGREGATE COST PER TON AND LONG-TERM ANNUAL
COST PER TON
($2002)
30 year discounted life- 30 year discounted life- Long-term cost per ton
Pollutant time cost per ton at 3% time cost per ton at 7% in 2030
NOX+NMHC ................................................................................. $1,010 $1,160 $680

PM ................................................................................................ 11,200 11,800 9,300
SOX .............................................................................................. 690 620 810
3. Annual Costs for the NRLM Fuel-only associated with the NRLM fuel-only engines and equipment. The fuel costs
Scenario scenario because new engine emissions are largely offset by the maintenance
Cent per gallon costs for the new 500 standards are not included in that savings that range from $250 million in
ppm NRLM fuel, the new 500 ppm L&M scenario. Figure VI.D–2 shows the 2008 to $500 million in 2036. As a
fuel, the new 15 ppm NR fuel, and the annual costs associated with the NRLM whole, the net cost of the program in
new 15 ppm NRLM fuel were presented fuel-only program. each year ranges from a small net
in section IV.A. Having this fuel will As can be seen in figure VI.D–1, the savings in 2008 to around $780 million
result in maintenance savings associated costs for refining and distributing the in 2036. The net present value (i.e., the
with increased oil change intervals for fuel range from $250 million in 2008 to value in 2004) of the net costs
both the new and the existing fleet of nearly $1.3 billion in 2036. The increase associated with the NRLM fuel-only
nonroad, locomotive, and marine in fuel costs in 2010 reflect the change program during the 30 year period from
engines. These maintenance savings to higher cost 15 ppm NR fuel. Fuel 2007 to 2036 is estimated at $9.2 billion
were discussed in section VI.B. There costs continue to grow as more fuel is using a 3 percent discount rate and $4.6
are no engine and equipment costs consumed by the increasing number of billion using a 7 percent discount rate.
4. Cost Per Ton of Emissions Reduced two-thirds to SO2 control. This is and PM emission reductions at 462,000
for the NRLM Fuel-Only Scenario consistent with the cost accounting we tons using 3 percent discounting, 3.2
The fuel-borne sulfur reduction under have used throughout our analysis in million tons and 255,000 tons,
the NRLM fuel-only scenario will result that costs associated with fuel-derived respectively, using 7 percent
in significant reductions of both SO2 emissions reductions are attributed one- discounting.
and PM emissions. Since there are no third to PM control and two-thirds to Table VI.D–1 shows the cost per ton
new engine standards associated with SO2 control. of emissions reduced as a result of the
the NRLM fuel-only scenario, the As discussed above, the 30 year net NRLM fuel-only scenario. The cost per
emissions reductions that result are present value of costs associated with ton numbers include costs and
entirely fuel-derived. Roughly 98 the fuel-only program are estimated at emissions reductions that will occur
percent of fuel-borne sulfur is converted $9.2 billion using 3 percent discounting from both the new and the existing fleet
to SO2 in the engine with the remaining and $4.6 billion using 7 percent (i.e., those pieces of nonroad equipment
two percent being exhausted as sulfate discounting. We have estimated the 30 that were sold into the market prior to
PM. We have allocated one-third of the year net present value of the SO2 the new fuel standards) of nonroad,
costs of this program to PM control and emission reductions at 5.7 million tons locomotive, and marine engines.
TABLE VI.D– 2.— NRLM FUEL-ONLY SCENARIO— 30-YEAR AGGREGATE COST PER TON AND LONG-TERM ANNUAL COST
PER TON
[$2002]
30 year discounted life- 30 year discounted life- Long-term cost per ton
Pollutant time cost per ton at 3% time cost per ton at 7% in 2030
PM ................................................................................................ $6,600 $6,000 $7,900

SO2 .............................................................................................. 1,070 970 1,270
ER29JN04.005</GPH>
We also considered the cost per ton of TABLE VI.D– 4. ‘‘NRT4 COST PER section. Briefly, the analysis projects
the NRLM fuel-only scenario without TON COMPARISON TO PREVIOUS major benefits throughout the period
including the expected maintenance MOBILE SOURCE PROGRAMS FOR from initial implementation of the rule
savings associated with low sulfur fuel. PM over a 30 year period through 2036. As
Without the maintenance savings, the described below, thousands of deaths
30 year discounted cost per ton of PM Program $/ton and other serious health effects would
reduced would be $11,800 and of SO2 be prevented, yielding a net present
reduced would be $1,900 using 3 Tier 4 Nonroad Diesel (full value in 2004 of those benefits we could
program) ............................ 11,200
percent discounting and $11,200 and monetize of approximately $805 billion
Tier 4 NRLM fuel-only (fuel-
$1,800, respectively, using 7 percent only scenario) .................... 6,800 dollars using a 3 percent discount rate
discounting. More detail on how the Tier 1/Tier 2 Nonroad Diesel 2,390 and $352 billion using a 7 percent
costs and cost per ton numbers 2007 Highway HD ................ 14,180 discount rate. These benefits exceed the
associated with the NRLM fuel-only Marine CI engines ................ 4,040– 5,440 net present value of the social cost of
scenario were calculated can be found 1996 urban bus .................... 12,780– 20,450 the proposal ($27 billion using a 3
in the RIA. Urban bus retrofit/rebuild ...... 31,530 percent discount rate and $14 billion
1994 highway HD diesel ...... 21,780– 25,500
using a 7 percent discount rate) by $780
5. Comparison With Other Means of Note: Costs adjusted to 2002 dollars using billion using a 3 percent discount rate
Reducing Emissions the Producer Price Index for Total Manufac- and $340 billion using a 7 percent
turing Industries.
In comparison with other emissions discount rate.
To compare the cost per ton of SO2
control programs, we believe that the 1. What Were the Results of the Benefit-
emissions reduced, we looked at the
Tier 4 programs represent a cost Cost Analysis?
cost per ton for the Title IV (acid rain)
effective strategy for generating
SO2 trading programs. This information
substantial NOX+NMHC, PM, and SO2 Table VI.E–1 presents the primary
is found in EPA report 430/R–02–004,
reductions. This can be seen by estimate of reduced incidence of PM-
‘‘Documentation of EPA Modeling
comparing the cost per ton of emissions related health effects for the years 2020
Applications (V.2.1) Using the
reduced by the NRLM fuel-only scenario and 2030. In interpreting the results, it
Integrated Planning Model’’, in Figure
(i.e., reducing fuel sulfur to 500 ppm in is important to keep in mind the limited
9.11 on page 9–14 (www.epa.gov/
2007 and 15 ppm in 2010 without any set of effects we are able to monetize.
airmarkets/epa-ipm/
new nonroad engine standards) and the Specifically, the table lists the PM-
index.html#documentation). The SO2
cost per ton of emissions reduced by the related benefits associated with the
cost per ton results of the full Tier 4
full NRLM fuel and nonroad engine reduction of several health effects. In
program presented in table VI.D–2
program (i.e., fuel control and new 2030, we estimate that there will be
compare very favorably with the
engine standards) with a number of 12,000 fewer fatalities in adults 239 and
program shown in table VI.D–5.
standards that EPA has adopted in the 20 fewer fatalities in infants per year
past. Tables VI.D–3 and VI.D–4TABLE VI.D– 5.— NRT4 COST PER associated with fine PM, and the rule
TON COMPARISON TO SO2 FROM will result in about 5,600 fewer cases of
summarize the cost per ton of several
BOTH THE EPA BASE CASE 2000 chronic bronchitis, 8,900 fewer
past EPA actions to reduce emissions of
NOX+NMHC and PM from mobile FOR THE TITLE IV SO2 TRADING hospitalizations (for respiratory and
sources, all of which were considered
PROGRAMS AND THE PROPOSED cardiovascular disease combined), and
by EPA to be appropriate. INTERSTATE AIR QUALITY RULE result in 1 million days per year when
adults miss work because of their
TABLE VI.D– 3.— NRT4 COST PER Program $/ton respiratory symptoms and 5.9 million
TON COMPARISON TO PREVIOUS days of when adults must restrict their
MOBILE SOURCE PROGRAMS FOR Tier 4 Nonroad Diesel (full
program).
$690 activity due to respiratory illness. We
NOX + NMHC also estimate substantial health
Tier 4 Nonroad Diesel (fuel- 1,070
only scenario). improvements for children from
Program $/ton Title IV SO2 Trading Pro- 490 in 2010 to reduced upper and lower respiratory
grams. 610 in 2020 illness, acute bronchitis, and asthma
Tier 4 Nonroad Diesel (full Interstate Air Quality Rule 730 in 2010 to
program) ............................ 1,010 (average cost). 830 in 2015 239 While we did not include separate estimates
Tier 2 Nonroad Diesel .......... 630 of the number of premature deaths that would be
Tier 3 Nonroad Diesel .......... 430 Note: Costs adjusted to 2002 dollars using avoided due to reductions in ozone levels, recent
the Producer Price Index for Total Manufac- evidence has been found linking short-term ozone
Tier 2 vehicle/gasoline sulfur 1,400– 2,350 turing Industries.
2007 Highway HD ................ 2,240 exposures with premature mortality independent of
2004 Highway HD ................ 220– 430 As the above comparisons show, both PM exposures. Recent reports by Thurston and Ito
the NRLM fuel-only scenario, when (2001) and the World Health Organization (WHO)
Tier 1 vehicle ........................ 2,150– 2,910 support an independent ozone mortality impact,
NLEV .................................... 2,020 viewed by itself, and the combination of and the EPA Science Advisory Board has
Marine SI engines ................ 1,220– 1,930 NRLM fuel and nonroad engine recommended that EPA reevaluate the ozone
On-board diagnostics ........... 2,410 standards, are both cost effective mortality literature for possible inclusion in the
strategies to achieve the associated estimate of total benefits. Based on these new
Marine CI engines ................ 30– 190 analyses and recommendations, EPA is sponsoring
Large SI Exhaust .................. 80 emissions reductions. three independent meta-analyses of the ozone-
Recreational Marine ............. 670 mortality epidemiology literature to inform a
E. Do the Benefits Outweigh the Costs determination on inclusion of this important health
Note: Costs adjusted to 2002 dollars using of the Standards? endpoint. Upon completion and peer-review of the
the Producer Price Index for Total Manufac- Our analysis of the health and meta-analyses, EPA will make its determination on
turing Industries. whether and how benefits of reductions in ozone-
environmental benefits to be expected related mortality will be included in the benefits
from this final rule are presented in this analysis for future rulemakings.
attacks.240 We were unable to quantify benefits, and EPA believes there is monetized benefits are $42 + B billion
the benefits related to ozone and other considerable value to the public of the using a 3 percent discount rate and $41
pollutants for the final rule, although we benefits that could not be monetized. A + B billion using a 7 percent discount
do present some preliminary ozone full listing of the benefit categories that rate. These estimates account for growth
modeling in Chapter 9 of the RIA. could not be quantified or monetized in in real gross domestic product (GDP) per
Table VI.E–2 presents the total our estimate are provided in table VI.E– capita between the present and the years
monetized benefits for the years 2020 6. 2020 and 2030. As the table indicates,
and 2030. This table also indicates with In summary, EPA’s primary estimate total benefits are driven primarily by the
a ‘‘B’’ those additional health and of the benefits of the rule are $83 + B
reduction in premature fatalities each
environmental effects which we were billion in 2030 using a 3 percent
year, which account for over 90 percent
unable to quantify or monetize. These discount rate and $78 + B billion using
effects are additive to estimate of total a 7 percent discount rate. In 2020, total of total benefits.
TABLE VI.E– 1.— REDUCTIONS IN INCIDENCE OF PM-RELATED ADVERSE HEALTH EFFECTS ASSOCIATED WITH THE FINAL
NONROAD DIESEL ENGINE AND FUEL STANDARDS FULL PROGRAM
Avoided incidence a (cases/year)
Endpoint
2020 2030
Premature mortality b: Long-term exposure (adults, 30 and over) .............................................................. 6,500 12,000
Infant mortality (infants under one year) ..................................................................................................... 15 22
Chronic bronchitis (adults, 26 and over) ..................................................................................................... 3,500 5,600
Non-fatal myocardial infarctions (adults, 18 and older) .............................................................................. 8,700 15,000
Hospital admissions— Respiratory (adults, 20 and older) c ......................................................................... 2,800 5,100
Hospital admissions— Cardiovascular (adults, 20 and older) d ................................................................... 2,300 3,800
Emergency Room Visits for Asthma (18 and younger) .............................................................................. 3,800 6,000
Acute bronchitis (children, 8– 12) ................................................................................................................. 8,400 13,000
Asthma exacerbations (asthmatic children, 6– 18) ...................................................................................... 120,000 200,000
Lower respiratory symptoms (children, 7– 14) ............................................................................................. 100,000 160,000
Upper respiratory symptoms (asthmatic children, 9– 11) ............................................................................ 76,000 120,000
Work loss days (adults, 18– 65) ................................................................................................................... 670,000 1,000,000
Minor restricted activity days (adults, age 18– 65) ...................................................................................... 4,000,000 5,900,000
Notes: a Incidences are rounded to two significant digits. b Premature mortality associated with ozone is not separately included in this analysis.
c Respiratory hospital admissions for PM includes admissions for COPD, pneumonia, and asthma. d Cardiovascular hospital admissions for PM
includes total cardiovascular and subcategories for ischemic heart disease, dysrhythmias, and heart failure.
TABLE VI.E– 2.— EPA PRIMARY ESTIMATE OF THE ANNUAL QUANTIFIED AND MONETIZED BENEFITS ASSOCIATED WITH IM-
PROVED PM AIR QUALITY RESULTING FROM THE FINAL NONROAD DIESEL ENGINE AND FUEL STANDARDS FULL PRO-
GRAM
Monetary Benefits a, b (millions 2000$,

Adjusted for Income Growth)
Endpoint
2020 2030
Premature mortality c: (adults, 30 and over)

3% discount rate ................................................................................................................................... $41,000 $77,000
7% discount rate ................................................................................................................................... 38,000 72,000
Infant mortality (infants under one year) ..................................................................................................... 97 150
Chronic bronchitis (adults, 26 and over) ..................................................................................................... 1,500 2,400
Non-fatal myocardial infarctions d
3% discount rate ................................................................................................................................... 750 1,200
7% discount rate ................................................................................................................................... 720 1,200
Hospital Admissions from Respiratory Causes e ......................................................................................... 49 92
Hospital Admissions from Cardiovascular Causes f .................................................................................... 51 83
Emergency Room Visits for Asthma ........................................................................................................... 1.1 1.7
Acute bronchitis (children, 8– 12) ................................................................................................................. 3.2 5.2
Asthma exacerbations (asthmatic children, 6– 18) ...................................................................................... 5.7 9.2
Lower respiratory symptoms (children, 7– 14) ............................................................................................. 1.7 2.7
Upper respiratory symptoms (asthmatic children, 9– 11) ............................................................................ 2.0 3.2
Work loss days (adults, 18– 65) ................................................................................................................... 92 130
Minor restricted activity days (adults, age 18– 65) ...................................................................................... 210 320
Recreational visibility (86 Class I Areas) ..................................................................................................... 1,000 1,700
Monetized Total g.
3% discount rate ........................................................................................................................... 44,000+B 83,000+B
240 Our PM-related estimate in 2030 incorporates asthmatic children each year, and 13,000 fewer exposure to particles. Additional incidents would
significant reductions of 160,000 fewer cases of cases of acute bronchitis in children ages 8 to 12 be avoided from reduced ozone exposures. Asthma
lower respiratory symptoms in children ages 7 to each year. In addition, we estimate that this rule is the most prevalent chronic disease among
14 each year, 120,000 fewer cases of upper will reduce almost 6,000 emergency room visits for children and currently affects over seven percent of
respiratory symptoms (similar to cold symptoms) in asthma attacks in children each year from reduced children under 18 years of age.
TABLE VI.E– 2.— EPA PRIMARY ESTIMATE OF THE ANNUAL QUANTIFIED AND MONETIZED BENEFITS ASSOCIATED WITH IM-
PROVED PM AIR QUALITY RESULTING FROM THE FINAL NONROAD DIESEL ENGINE AND FUEL STANDARDS FULL PRO-
GRAM— Continued
Monetary Benefits a, b (millions 2000$,

Adjusted for Income Growth)
Endpoint
2020 2030
7% discount rate ........................................................................................................................... 42,000+B 78,000+B

Notes: a Monetary
benefits are rounded to two significant digits. b Monetary
benefits are adjusted to account for growth in real GDP per capita
between 1990 and the analysis year (2020 or 2030). c Valuation of base estimate assumes discounting over the lag structure described in the
RIA Chapter 9. Estimates assume costs of illness and lost earnings in later life years are discounted using either 3 or 7 percent. e Respiratory
d
hospital admissions for PM includes admissions for COPD, pneumonia, and asthma. f Cardiovascular hospital admissions for PM includes total
cardiovascular and subcategories for ischemic heart disease, dysrhythmias, and heart failure. g B represents the monetary value of the
unmonetized health and welfare benefits. A detailed listing of unquantified PM, ozone, CO, and NMHC related health effects is provided in Table
VI.E– 6.
The estimated social cost (measured billion using a 3 percent discount rate Rule from 2007 to 2036 using two
as changes in consumer and producer and $41 + B billion using a 7 percent different discount rates. In addition,
surplus) in 2030 to implement the final discount rate. Therefore, table VI.E–4 presents the net present
rule from table VI.E–3 is $2.0 billion implementation of the final rule is value of the stream of benefits, costs,
(2000$). Thus, the net benefit (social expected to provide society with a net and net benefits associated with the rule
benefits minus social costs) of the gain in social welfare based on for this 30 year period. The total net
program at full implementation is economic efficiency criteria. Table VI.E– present value in 2004 of the stream of
approximately $81 + B billion using a 3 3 presents a summary of the benefits, net benefits (benefits minus costs) is
percent discount rate and $78 + B costs, and net benefits of the final rule’s $780 billion using a 3 percent discount
billion using a 7 percent discount rate. full program. Figure VI–E.1 displays the rate and $340 billion using a 7 percent
In 2020, partial implementation of the stream of benefits, costs, and net
discount rate.
program yields net benefits of $42 + B benefits of the Nonroad Diesel Vehicle
TABLE VI.E– 3.— SUMMARY OF BENEFITS, COSTS, AND NET BENEFITS OF THE FINAL NONROAD DIESEL ENGINE AND FUEL
STANDARDS FULL PROGRAM
2020 a (Billions of 2000 dollars) 2030 a (Billions of 2000 dollars)
Social Costs b .......................................................................................... $1.8 ................................................ $2.0.

Social Benefits: b c d
CO, VOC, Air Toxic-related benefits ................................................ Not monetized ............................... Not monetized.
Ozone-related benefits ..................................................................... Not monetized ............................... Not monetized.
PM-related Welfare benefits ............................................................ $1.0 ................................................ $1.7.
PM-related Health benefits [3% discount] ....................................... $43 + B .......................................... $81 + B.
PM-related Health benefits [7% discount] ....................................... $41 + B .......................................... $78 + B.
Net Benefits (Benefits-Costs) [3% discount] c ......................................... $44 + B .......................................... $81 + B.
Net Benefits (Benefits-Costs) [7% discount] c ......................................... $42 + B .......................................... $78 + B.
Notes: a All costs and benefits are calculated using 3 and 7 percent discount rates and are rounded to two significant digits. Numbers may ap-
pear not to sum due to rounding.
b Note that costs are the total costs of reducing all pollutants, including CO, VOCs and air toxics, as well as NO and PM. Costs were con-
X
verted to 2000$ using the PPI for Total Manufacturing Industries. Benefits in this table are associated only with PM endpoints related to direct
PM, NOX and SO2 reductions in 48-states.
c Not all possible benefits or disbenefits are quantified and monetized in this analysis. Potential benefit categories that have not been quantified
and monetized are listed in table VI.E– 6. B is the sum of all unquantified benefits and disbenefits.
TABLE VI.E– 4.— NET PRESENT VALUE are approximately $18 + B billion using TABLE VI.E– 5.— NET PRESENT VALUE
IN 2004 OF THE STREAM OF 30 a 3 percent discount rate and $16 + B IN 2004 OF THE STREAM OF BENE-
YEARS OF BENEFITS, COSTS, AND billion using a 7 percent discount rate. FITS, COSTS, AND NET BENEFITS
NET BENEFITS FOR THE FULL These estimates account for growth in FOR THE FUEL-ONLY STANDARDS
NONROAD DIESEL ENGINE AND FUEL real gross domestic product (GDP) per [Billions of 2000$]
STANDARDS capita between the present and the years
2020 and 2030. We present the 3% Dis- 7% Dis-
[Billions of 2000$]
engineering costs of implementing the count rate count rate
3% dis- 7% dis- fuel-only components of the rule.
Costs ..................... $9.2 $4.6
count rate count rate Engineering compliance costs are very
Social Benefits ...... 340 160
similar to the total social costs for the Net Benefits .......... 330 160
Social Costs .......... $27 $14 entire program. The net benefit (social
Social Benefits ...... 805 352 benefits minus engineering costs) of the Notes:
Net Benefits a ........ 780 340 A Results are rounded to two significant dig-
fuel-only program at full its. Sums may differ because of rounding.
Notes: Numbers do not add due to round- implementation is approximately $330
a B Engineering costs are presented instead of
ing. Benefits represent 48-state benefits and + B billion using a 3 percent discount social costs. As discussed in previous chap-
exclude home heating oil sulfur reduction ben- ters, total engineering costs include fuel costs
efits, whereas costs include 50-state rate and $160 + B billion using a 7 (refining, distribution, lubricity) and other oper-
estimates. percent discount rate. Therefore, ating costs (oil change maintenance savings).
implementation of the fuel-only C Note that costs are the total costs of re-
In addition, we analyzed the social ducing all pollutants, including CO, VOCs and
components of the final rule is expected
benefits and costs of the fuel-only air toxics, as well as NOX and PM. Benefits in
to provide society with a net gain in this table are associated only with PM, NOX
components of the program, as
discussed in the RIA. EPA’s primary social welfare based on economic and SO2 reductions. The estimates do not in-
efficiency criteria. Table VI.E–5 presents clude the benefits of reduced sulfur in home
estimate of the benefits of the fuel-only heating oil or benefits in Alaska or Hawaii.
component of the final rule are a summary of the social benefits,
approximately $28 + B billion in 2030 engineering costs, and net benefits of 2. What Was Our Overall Approach to
using a 3 percent discount rate and $25 the final rule’s fuel-only program for a the Benefit-Cost Analysis?
+ B billion using a 7 percent discount 30 year period. The basic question we sought to
rate. In 2020, total monetized benefits answer in the benefit-cost analysis was,
ER29JN04.006</GPH>
‘‘What are the net yearly economic emissions reductions between the Agency take a number of steps to
benefits to society of the reduction in modeled preliminary control option and improve its benefits analysis. In
mobile source emissions likely to be the proposed standards. The sum of the particular, the NAS stated that the
achieved by this proposed rulemaking?’’ scaled benefits for the PM, SO2, and Agency should:
In designing an analysis to address this NOX emission reductions provide us • Include benefits estimates for a
question, we selected two future years with the total benefits of the rule. range of regulatory options;
for analysis (2020 and 2030) that are The benefit estimates derived from • Estimate benefits for intervals, such
representative of the stream of benefits the modeled preliminary control option as every five years, rather than a single
and costs at partial and full- in phase one of our analysis uses an year;
implementation of the program. analytical structure and sequence • Clearly state the projected baseline
To quantify benefits, we evaluated similar to that used in the benefits statistics used in estimating health
PM-related health effects (including analyses for the Heavy Duty Engine/ benefits, including those for air
directly emitted PM and sulfate, as well Diesel Fuel final rule and in the emissions, air quality, and health
as SO2 and NOX contributions to fine ‘‘section 812 studies’’ to estimate the outcomes;
particulate matter). Our approach total benefits and costs of the full Clean • Examine whether implementation
requires the estimation of changes in air Air Act. 241 We used many of the same of proposed regulations might cause
quality expected from the rule and then models and assumptions used in the unintended impacts on human health or
estimating the resulting impact on Heavy Duty Engine/Diesel Fuel analysis the environment;
health. In order to characterize the as well as other Regulatory Impact • When appropriate, use data from
benefits of today’s action, given the Analyses (RIAs) prepared by the Office non-U.S. studies to broaden age ranges
constraints on time and resources of Air and Radiation. By adopting the to which current estimates apply and to
available for the analysis, we adopted a major design elements, models, and include more types of relevant health
benefits transfer technique that relies on assumptions developed for the section outcomes; and
air quality and benefits modeling for a 812 studies and other RIAs, we have
• Begin to move the assessment of
preliminary control option for nonroad largely relied on methods which have
uncertainties from its ancillary analyses
diesel engines and fuels. Results from already received extensive review by the
into its Base analyses by conducting
this modeling conducted for 2020 and independent Science Advisory Board
probabilistic, multiple-source
2030 are then scaled and transferred to (SAB), by the public, and by other
uncertainty analyses. This assessment
the emission reductions expected from federal agencies. In addition, we will be
should be based on available data and
the final rule. We also transferred working through the next section 812
expert judgment.
modeled results by using scaling factors study process to enhance our
associated with time to examine the methods. 242 Although the NAS made a number of
stream of benefits in years other than The benefits transfer method used in recommendations for improvement in
2020 and 2030. phase two of the analysis is similar to EPA’s approach, it found that the
More specifically, our health benefits that used to estimate benefits in the studies selected by EPA for use in its
assessment is conducted in two phases. recent analysis of the Nonroad Large benefits analysis were generally
Due to the time requirements for Spark-Ignition Engines and Recreational reasonable choices. In particular, the
running the sophisticated emissions and Engines standards (67 FR 68241, NAS agreed with EPA’s decision to use
air quality models, it is often necessary November 8, 2002). A similar method cohort studies to derive benefits
to select an example set of emission has also been used in recent benefits estimates. It also concluded that the
reductions to use for the purposes of analyses for the proposed Industrial Agency’s selection of the American
emissions and air quality modeling Boilers and Process Heaters NESHAP Cancer Society (ACS) study for the
early in the development of the and the Reciprocating Internal evaluation of PM-related premature
proposal. In phase one, we evaluate the Combustion Engines NESHAP. mortality was reasonable, although it
PM- and ozone-related health effects On September 26, 2002, the National noted the publication of new cohort
associated with a modeled preliminary Academy of Sciences (NAS) released a studies that should be evaluated by the
control option that was a close report on its review of the Agency’s Agency.
approximation of the standards in the methodology for analyzing the health EPA has addressed many of the NAS
years 2020 and 2030. Using information benefits of measures taken to reduce air comments in our analysis of the final
from the modeled preliminary control pollution. The report focused on EPA’s rule. We provide benefits estimates for
option on the changes in ambient approach for estimating the health each year over the rule implementation
concentrations of PM and ozone, we benefits of regulations designed to period for a wide range of regulatory
then estimate the number of reduced reduce concentrations of airborne PM. alternatives, in addition to our final
incidences of illnesses, hospitalizations, In its report, the NAS panel said that emission control program. We use the
and premature fatalities associated with EPA has generally used a reasonable estimated time path of benefits and
this scenario and estimate the total framework for analyzing the health costs to calculate the net present value
economic value of these health benefits. benefits of PM-control measures. It of benefits of the rule. In the RIA, we
Based on public comment and other recommended, however, that the provide baseline statistics for air
data described in the RIA, the standards emissions, air quality, population, and
we are finalizing in this rulemaking are 241 The section 812 studies include: (1) U.S. EPA, health outcomes. We have examined
slightly different in the amount of Report to Congress: The Benefits and Costs of the how our benefits estimates might be
Clean Air Act, 1970 to 1990, October 1997 (also impacted by expanding the age ranges to
emission reductions expected to be known as the ‘‘Section 812 Retrospective Report’’);
achieved in 2020 and 2030 relative to and (2) the first in the ongoing series of prospective which epidemiological studies are
the modeled scenario. Thus, in phase studies estimating the total costs and benefits of the applied, and we have added several new
two of the analysis, we apportion the Clean Air Act (see EPA report number: EPA–410– health endpoints, including non-fatal
results of the phase one analysis to the R–99–001, November 1999). See Docket A–99–06, heart attacks, which are supported by
Document II–A–21.
underlying NOX, SO2, and PM emission 242 Interested parties may want to consult the both U.S. studies and studies conducted
reductions and scale the apportioned webpage: http://www.epa.gov/science1 regarding in Europe. We have also improved the
benefits to reflect differences in components of our analytical blueprint. documentation of our methods and
provided additional details about model • The exclusion of potentially the range of ambient concentrations
assumptions. significant benefit categories (such as under consideration. Thus, the
Several of the NAS recommendations health, odor, and ecological benefits of estimates include health benefits from
addressed the issue of uncertainty and reduction in CO, VOCs, air toxics, and reducing fine particles in areas with
how the Agency can better analyze and ozone); varied concentrations of PM, including
communicate the uncertainties • Errors in measurement and both regions that are in attainment with
associated with its benefits assessments. projection for variables such as fine particle standard and those that do
In particular, the Committee expressed population growth; not meet the standard.
concern about the Agency’s reliance on • Uncertainties in the estimation of
future year emissions inventories and (4) The forecasts for future emissions
a single value from its analysis and
air quality; and associated air quality modeling are
suggested that EPA develop a
• Uncertainties associated with the valid. Although recognizing the
probabilistic approach for analyzing the
scaling of the results of the modeled difficulties, assumptions, and inherent
health benefits of proposed regulatory
benefits analysis to the proposed uncertainties in the overall enterprise,
actions. The Agency agrees with this
standards, especially regarding the these analyses are based on peer-
suggestion and is working to develop
assumption of similarity in geographic reviewed scientific literature and up-to-
such an approach for use in future
distribution between emissions and date assessment tools, and we believe
rulemakings.
EPA plans to continue to refine its human populations and years of the results are highly useful in assessing
plans for addressing uncertainty in its analysis; this rule.
analyses. EPA conducted a pilot study • Variability in the estimated We provide sensitivity analyses to
to address uncertainty in important relationships of health and welfare illustrate the effects of uncertainty about
analytical parameters such as the effects to changes in pollutant key analytical assumptions in the RIA.
concentration-response relationship for concentrations;
• Uncertainties in exposure In addition, one significant limitation
PM-related premature mortality. EPA is to the benefit transfer method applied in
also conducting longer-term elements estimation; and
• Uncertainties associated with the this analysis is the inability to scale
intended to provide scientifically ozone-related benefits. Because ozone is
effect of potential future actions to limit
sound, peer-reviewed characterizations a homogeneous gaseous pollutant, it is
emissions.
of the uncertainty surrounding a broader Despite these uncertainties, we not possible to apportion ozone benefits
set of analytical parameters and believe the benefit-cost analysis to the precursor emissions of NOX and
assumptions, including but not limited provides a reasonable indication of the VOC. Coupled with the potential for
to emissions and air quality modeling, expected economic benefits of the final NOX reductions to either increase or
demographic projections, population rulemaking in future years under a set decrease ambient ozone levels, this
health status, concentration-response of assumptions. Accordingly, we prevents us from scaling the benefits
functions, and valuation estimates. present a primary estimate of the total associated with a particular
3. What Are the Significant Limitations benefits, based on our interpretation of combination of VOC and NOX emissions
of the Benefit-Cost Analysis? the best available scientific literature reductions to another. Because of our
and methods and supported by the inability to scale ozone benefits, we do
Every benefit-cost analysis examining
SAB–HES and the NAS. not include ozone benefits as part of the
the potential effects of a change in Some of the key assumptions
environmental protection requirements monetized benefits of the proposed
underlying the primary estimate for the standards. For the most part, ozone
is limited to some extent by data gaps, premature mortality which accounts for
limitations in model capabilities (such benefits contribute substantially less to
90 percent of the total benefits we were the monetized benefits than do benefits
as geographic coverage), and able to quantify include the following:
uncertainties in the underlying from PM, thus their omission will not
(1) Inhalation of fine particles is materially affect the conclusions of the
scientific and economic studies used to causally associated with premature
configure the benefit and cost models. benefits analysis. Although we expect
death at concentrations near those economic benefits to exist, we were
Deficiencies in the scientific literature experienced by most Americans on a
often result in the inability to estimate unable to quantify or to value specific
daily basis. Although biological changes in ozone, CO or air toxics
quantitative changes in health and mechanisms for this effect have not yet
environmental effects, such as potential because we did not perform additional
been definitively established, the weight air quality modeling.
increases in premature mortality of the available epidemiological
associated with increased exposure to evidence supports an assumption of There are also a number of health and
carbon monoxide. Deficiencies in the causality. environmental effects which we were
economics literature often result in the (2) All fine particles, regardless of unable to quantify or monetize. A full
inability to assign economic values even their chemical composition, are equally appreciation of the overall economic
to those health and environmental potent in causing premature mortality. consequences of the proposed rule
outcomes which can be quantified. This is an important assumption, requires consideration of all benefits
While these general uncertainties in the because PM produced via transported and costs expected to result from the
underlying scientific and economics precursors emitted from EGUs may new standards, not just those benefits
literatures, which can cause the differ significantly from direct PM and costs which could be expressed
valuations to be higher or lower, are released from diesel engines and other here in dollar terms. A complete listing
discussed in detail in the Regulatory industrial sources, but no clear of the benefit categories that could not
Support Document and its supporting scientific grounds exist for supporting be quantified or monetized in our
documents and references, the key differential effects estimates by particle estimate are provided in Table VI.E–6.
uncertainties which have a bearing on type. These effects are denoted by ‘‘B’’ in
the results of the benefit-cost analysis of (3) The impact function for fine Table VI.E–3 above, and are additive to
this final rule include the following: particles is approximately linear within the estimates of benefits.
TABLE VI.E– 6.— ADDITIONAL, NON-MONETIZED BENEFITS OF THE NONROAD DIESEL ENGINE AND FUEL STANDARDS
Pollutant Unquantified effects
Ozone Health ....................... Premature mortality a.

Respiratory hospital admissions.
Minor restricted activity days.
Increased airway responsiveness to stimuli.
Inflammation in the lung.
Chronic respiratory damage.
Premature aging of the lungs.
Acute inflammation and respiratory cell damage.
Increased susceptibility to respiratory infection.
Non-asthma respiratory emergency room visits.
Increased school absence rates.
Ozone Welfare ..................... Decreased yields for commercial forests.

Decreased yields for fruits and vegetables.
Decreased yields for non-commercial crops.
Damage to urban ornamental plants.
Impacts on recreational demand from damaged forest aesthetics.
Damage to ecosystem functions.
PM Health ............................ Low birth weight.

Changes in pulmonary function.
Chronic respiratory diseases other than chronic bronchitis.
Morphological changes.
Altered host defense mechanisms.
Cancer.
Non-asthma respiratory emergency room visits.
PM Welfare .......................... Visibility in many Class I areas.

Residential and recreational visibility in non-Class I areas.
Soiling and materials damage.
Damage to ecosystem functions.
Nitrogen and Sulfate Deposi- Impacts of acidic sulfate and nitrate deposition on commercial forests.
tion Welfare.
Impacts of acidic deposition to commercial freshwater fishing.
Impacts of acidic deposition to recreation in terrestrial ecosystems.
Reduced existence values for currently healthy ecosystems.
Impacts of nitrogen deposition on commercial fishing, agriculture, and forests.
CO Health ............................ Premature mortality a.

Behavioral effects.
HC Health b ........................... Cancer (benzene, 1,3-butadiene, formaldehyde, acetaldehyde).

Anemia (benzene).
Disruption of production of blood components (benzene).
Reduction in the number of blood platelets (benzene).
Excessive bone marrow formation (benzene).
Depression of lymphocyte counts (benzene).
Reproductive and developmental effects (1,3-butadiene).
Irritation of eyes and mucus membranes (formaldehyde).
Respiratory irritation (formaldehyde).
Asthma attacks in asthmatics (formaldehyde).
Asthma-like symptoms in non-asthmatics (formaldehyde).
Irritation of the eyes, skin, and respiratory tract (acetaldehyde).
Upper respiratory tract irritation and congestion (acrolein).
HC Welfare ........................... Direct toxic effects to animals.

Bioaccumulation in the food chain.
Damage to ecosystem function.
Odor.
Notes: a Premature mortality associated with ozone and carbon monoxide is not separately included in this analysis. In this analysis, we as-
sume that the Pope, et al. C-R function for premature mortality captures both PM mortality benefits and any mortality benefits associated with
other air pollutants.
b Many of the key hydrocarbons related to this rule are also hazardous air pollutants listed in the Clean Air Act.
F. Economic Impact Analysis control program on producers and industries.243 We received comments on
consumers of nonroad engines,
We prepared a draft Economic Impact equipment, fuel, and related 243 This analysis is based on an earlier version of
Analysis (EIA) for this rule to estimate
the engineering costs developed for this rule. The
the economic impacts of the proposed Continued
our draft analysis from stakeholders (a) the use of resources to comply with and we apportion the decrease in
representing agricultural interests, and implement a regulation and (b) application market surplus between
equipment rental and dealer interests, reductions in output. 244 In this analysis, application market producers and
and equipment manufacturers. The social costs are explored in two steps. In application market consumers, we do
commenters conveyed their concerns the first step, called the market analysis, not estimate how those social costs will
about our general analytic approach and we estimate how prices and quantities be shared among specific application
some of the model assumptions. As of good directly and indirectly affected market producers and consumers (e.g.,
explained in our responses to these by the emission control program can be farmers and households). In some cases,
comments, which can be found in the expected to change once the emission application market producers may be
Summary and Analysis of Comments control program goes into effect. The able to pass most if not all of their
document prepared for this final rule, estimated price and quantity changes for increased costs to the ultimate
we do not believe these comments engines, equipment, fuel, and goods consumers of their products; in other
require us to adjust our EIA produced using these inputs are cases, they may be obliged to absorb a
methodology. We did adjust the examined separately. In the second step, portion of these costs. While some
methodology, however, to estimate the called the economic welfare analysis, commenters requested that we perform
economic impacts of the fuel sulfur we look at the total social costs a sector-by-sector analysis of application
content requirements on the locomotive associated with the program and their market producers and consumers, we do
and marine sectors. As explained below, distribution across stakeholders. The not believe this is appropriate. The
this revision was necessary to correct an analysis is based on compliance cost focus on market-level impacts in this
oversight in the draft EIA. We also estimates and baseline market analysis is appropriate because the
revised the price and quantity data conditions for prices and quantities of standards in this emission control
inputs to the model to make them engines, equipment, and fuel produced program are technical standards that
consistent with the revised engine and presented earlier in this section. apply to nonroad engines, equipment,
fuel cost analyses described earlier in In this EIA, we look at price and and fuel regardless of how they are used
this section. quantity impacts for engine, equipment, and the structure of the program does
This section briefly describes the diesel fuel, and goods produced with not suggest that different sectors will be
methodology we used to estimate the these inputs. With regard to the goods affected differently by the requirements.
economic impacts of this final rule, produced with these inputs, we In addition, the results of our EIA
including the model revisions for the distinguish between three application suggest that the overall burden on the
marine and locomotive fuel sectors, and markets: agriculture, construction, and application market is expected to be
the results of that analysis. A detailed manufacturing. It should be noted from small: approximately 0.1 percent
description of the Nonroad Diesel the outset that diesel engines, increase in prices, on average, and less
Economic Impact Model (NDEIM) equipment, and fuel represent only a than 0.02 percent decrease in
prepared for this analysis, the model small portion of the total production production, on average. Estimated
inputs, and several sensitivity analyses costs for each of the three application economic impacts of this size do not
can be found in Chapter 10 of Final market sectors (the final users of the warrant performing a sector-by-sector
Regulatory Impact Analysis prepared for engines, equipment and fuel affected by analysis to investigate whether some
this rule. this rule). Other more significant subsectors may be affected
production costs include land, labor, disproportionately.
1. What Is an Economic Impact other capital, raw materials, insurance, Finally, as a market-level model, the
Analysis? profits, etc. These other production NDEIM estimates the economic impacts
An Economic Impact Analysis is costs are not affected by this emission of the rule on the engine, equipment,
prepared to inform decision makers control program. This is important and application markets and the
within the Agency about the potential because it means that this rule directly transportation service sector. It is not a
economic consequences of a regulatory affects only a small part of total inputs firm-level analysis and therefore the
action. The analysis contains estimates for the relevant markets. Therefore, the equipment demand elasticity facing any
of the social costs of a regulatory rule is not expected to have a large particular manufacturer may be greater
program and explores the distribution of adverse impact on output and prices of than the demand elasticity of the market
these costs across stakeholders. These goods produced in the three application as a whole. This difference can be
estimated social costs can then be sectors. important, particularly where the rule
compared with estimated social benefits It should also be noted that our affects different firms’ costs over
(as presented in Section VI.E). As analysis of the impacts on the three different volumes of production.
defined in EPA’s Guidelines for application markets is limited to market However, to the extent there are
Preparing Economic Analyses, social output. The economic impacts on differential effects, EPA believes that the
costs are the value of the goods and particular groups of application market wide array of flexibilities provided in
services lost by society resulting from suppliers (e.g., the profitability of farm this rule are adequate to address any
production units or manufacturing or cost inequities that are likely to arise.
final cost estimates for the engine program are construction firms) or particular groups 2. What Methodology Did EPA Use in
slightly higher ($142 million) and the final fuel of consumers (e.g., households and This Economic Impact Analysis?
costs are slightly lower ($246 million), resulting in companies that consume agricultural
a 30-year net present value of $27.1 billion (30 year EPA used the same methodology in
net present values in the year 2004, using a 3 goods, buildings, or durable or
percent discount rate, $2002) or $104 million less consumer goods) are not estimated. In this final EIA as was used in the draft
than the engineering costs used in this analysis. We other words, while we estimate that the EIA. The model was revised to
do not expect that the revised engineering costs application markets will bear most of accommodate analysis of the locomotive
would change the overall results of this economic and marine fuel sectors.
impact analysis given the small portion of engine, the burden of the regulatory program
equipment, and fuel costs to total production costs a. Conceptual Approach
for goods and services using these inputs and given 244 EPA
Guidelines for Preparing Economic
the inelastic value of the estimated demand Analyses, EPA 240–R–00–003, September 2000, p The Nonroad Diesel Economic Impact
elasticities for the application markets. 113. Model (NDEIM) uses a multi-market
analysis framework that considers California fuel volumes that are not The NDEIM is a computer model
interactions between regulated markets affected by the program (because they comprised of a series of spreadsheet
and other markets to estimate how are covered by separate California modules that define the baseline
compliance costs can be expected to nonroad diesel fuel standards) are not characteristics of the supply and
ripple through these markets. In the included in the analysis. demand for the relevant markets and the
NDEIM, compliance costs are directly • 2 transportation service markets: relationships between them. The model
borne by engine manufacturers, locomotive and marine. is constructed based on the market
equipment manufacturers, petroleum As noted above, this final EIA also characteristics and inter-connections
refiners and fuel distributors. estimates the economic impact on two summarized in this section and
Depending on market characteristics, additional markets that were not described in more detail in Chapter 10
some or all of these compliance costs included in the draft analysis: the of the RIA. The model is shocked by
will be passed on through the supply locomotive and marine diesel applying the engineering compliance
chain in the form of higher input prices transportation service markets. In the cost estimates to the appropriate market
for the application markets (in this case, NPRM, we proposed to set fuel sulfur suppliers, and then numerically solved
construction, agriculture, and standards for locomotive and distillate using an iterative auctioneer approach
manufacturing) which in turn affect marine diesel as well as for nonroad by ‘‘calling out’’ new prices until a new
prices and quantities of goods produced diesel fuel. We developed cost estimates equilibrium is reached in all markets
in those application markets. Producers for these two types of fuel as well as for simultaneously. The output of the
in the application markets adjust their nonroad diesel fuel. In the draft EIA, model is new equilibrium prices and
demand for diesel engines, equipment, however, we did not consider the quantities for all affected markets. This
and fuel in response to these input price economic impacts of these fuel costs on information is used to estimate the
changes and consumer demand for the locomotive and marine sectors social costs of the model and how those
application market outputs. This separately. Instead, we applied all of costs are shared among affected markets.
information is passed back to the these additional fuel costs to the The NDEIM uses a multi-market
suppliers of diesel equipment, engines, manufacturing application market. partial equilibrium approach to track
and fuel in the form of purchasing In preparing the final RIA for this changes in price and quantity for the
decisions. The NDEIM explicitly models rule, we determined that it would be modeled product markets. As explained
these interactions and estimates more appropriate to consider the in the EPA Guidelines for Preparing
behavioral responses that lead to new impacts of the fuel program on the Economic Analyses, ‘‘partial’’
equilibrium prices and output for all diesel marine and locomotive sectors equilibrium refers to the fact that the
sectors and the resulting distribution of separately. This is because the supply and demand functions are
social costs across the modeled sectors. locomotive and marine markets are modeled for just one or a few isolated
b. Markets Examined directly affected by the higher diesel markets and that conditions in other
fuel prices associated with the rule. In markets are assumed either to be
The NDEIM uses a multi-market unaffected by a policy or unimportant
partial equilibrium approach to track addition, production and consumption
decisions of downstream end-use for social cost estimation. Multi-market
changes in price and quantity for 62 models go beyond partial equilibrium
integrated product markets, as follows: markets that use these services are
influenced by the prices of analysis by extending the inquiry to
• 7 diesel engine markets: less than more than just a single market. Multi-
25 hp, 26 to 50 hp, 51 to 75 hp, 76 to transportation services. At the same
time, locomotive and marine diesel market analysis attempts to capture at
100 hp, 101 to 175 hp, 176 to 600 hp, least some of the interactions between
and greater than 600 hp. The EIA transportation services are not used
solely in the three application markets markets.246
includes more horsepower categories The NDEIM uses an intermediate run
than the standards to allow more modeled in the NDEIM. These services
are also provided to electric utilities time frame. The use of the intermediate
efficient use of the engine compliance run means that some factors of
costs estimates. The additional (transporting coal to electric power
plants), non-manufacturing service production are fixed and some are
categories also allow estimating variable. This modeling period allows
economic impacts for a more diverse set industries (public transportation) and
governments. We take this into account analysis of the economic effects of the
of markets. rule’s compliance costs on current
• 42 diesel equipment markets: 7 and report impacts on those sectors
separately. producers. The short run, in contrast,
horsepower categories within 7 imposes all compliance costs on the
application categories: agricultural, c. Model Methodology manufacturers (no pass-through to
construction, general industrial, pumps consumers), while the long run imposes
and compressors, generator and welder A detailed description of the model
methodology, inputs, and parameters all costs on consumers (full cost pass-
sets, refrigeration and air conditioning, through to consumers). The use of the
and lawn and garden. There are 7 used in this economic impact analysis is
provided in Chapter 10 of the Final RIA intermediate run time frame is
horsepower/application categories that consistent with economic practices for
did not have sales in 2000 and are not prepared for this rule. The model
methodology is firmly rooted in applied this type of analysis.
included in the model, so the total The NDEIM assumes perfect
number of diesel equipment markets is microeconomic theory and was
developed following the OAQPS competition in the market sectors. This
42 rather than 49. assumption was questioned by one
• 3 application markets: agricultural, Economic Analysis Resource
commenter, who noted that the 25 to 75
construction, and manufacturing. Document.245
hp engine category does not appear to
• 8 nonroad diesel fuel markets: 2
be competitive based on the number of
sulfur content levels (15 ppm and 500 245 U.S. Environmental Protection Agency, Office
of Air Quality Planning and Standards, Innovative firms in that subsector. Specifically, one
ppm) for each of 4 PADDs. PADDs 1 and
Strategies and Economics Group, OAQPS Economic
3 are combined for the purpose of this Analysis Resource Document, April 1999. A copy 246 EPA Guidelines for Preparing Economic
analysis. It should be noted that PADD of this document can be found in Docket A–2001– Analyses, EPA 240–R–00–003, September 2000, p.
5 includes Alaska and Hawaii. Also, 28, Document No. II–A–14. 125–6.
firm has nearly 29 percent of the market (behavioral-response parameters), which equipment market) which depends on
and the top nine firms have about 88 measure the price sensitivity of the demand for equipment (the
percent. The remaining twelve percent consumers and producers. application markets). Changes in
of this market shared among nineteen The supply elasticities for the conditions in one of these markets will
other firms. While the commenter is equipment, engine, diesel fuel, and affect the others. By designing the
correct in noting the limited number of transportation service markets and the model to derive the engine, equipment,
firms in this subsector, we believe it is demand and supply elasticities for the transportation market, and fuel demand
still appropriate to rely on the perfect application markets used in the NDEIM elasticities, the NDEIM simulates these
competition assumption in this analysis. were obtained from peer-reviewed connections between supply and
The perfect competition assumption literature sources or were estimated demand among all the product markets
relies not only on the number of firms using econometric methods. These and replicates the economic interactions
in a market but also on other market econometric methods are well- between producers and consumers.
characteristics. For example, there are documented and are consistent with
generally accepted econometric e. Model Inputs—Fixed and Variable
no indications of barriers to entry, the Costs
firms in these markets are not price practice. Appendix 10H of the RIA
setters, and there is no evidence of high contains detailed information on how The EIA treats the fixed costs
levels of strategic behavior in the price the elasticities were estimated. expected to be incurred by engine and
and quantity decisions of the firms. In The equipment and engine supply equipment manufacturers differently in
addition, the products produced within elasticities are elastic, meaning that the market and social costs analyses.
each market are somewhat quantities supplied are expected to be This feature of the model is described in
homogeneous in that engines from one fairly sensitive to price changes. The greater detail in Section 10.2.3.3 of the
firm can be purchased instead of supply elasticities for the fuel, RIA. In the market analysis, estimated
engines from another firm. Finally, transportation, and application markets engine and equipment market impacts
according to contestable market theory, are inelastic or unit elastic, meaning (changes in prices and quantities) are
oligopolies and even monopolies will that the quantity supplied/demanded is based solely on the expected increase in
behave very much like firms in a expected to be fairly insensitive to price variable costs associated with the
competitive market if it is possible to changes or will vary one-to-one with standards. Fixed costs are not included
enter particular markets costlessly (i.e., price changes. The demand elasticities in the market analysis reported in Table
there are no sunk costs associated with for the application markets are also VI–F–1 because in an analysis of
inelastic. This is consistent with the competitive markets the industry supply
market entry or exit). With regard to the
Hicks-Allen derived demand curve is based on its marginal cost curve
nonroad engine market, production
relationship, according to which a low and fixed costs are not reflected in
capacity is not fully utilized. This
cost-share in production combined with changes in the marginal cost curve. In
means that manufacturers could
limited substitution yields inelastic addition, the fixed costs associated with
potentially switch their product line to
demand.248 As noted above, diesel the rule are primarily R&D costs for
compete in another segment of the
engines, equipment, and fuel represent design and engineering changes. Firms
market without a significant investment.
only a small portion of the total in the affected industries currently
For all these reasons, the number of
production costs for each of the three allocate funds for R&D programs and
firms in a particular engine submarket
application sectors. The limited ability this rule is not expected to lead firms to
does not prevent us from relying on the change the size of their R&D budgets.
to substitute for these inputs is
perfect competition assumption for that Therefore, changes in fixed costs for
discussed below.
submarket. This is true of other engine In contrast to the above, the demand engine and equipment redesign
and equipment subsectors as well. In elasticities for the engine, equipment, associated with this rule are not likely
addition, changing the assumption of fuel, and transportation markets are to affect the prices of engines or
perfect competition based on the limited internally derived as part of the process equipment. Fixed costs are included in
evidence raised by the commenter of running the model. This is an the social cost analysis reported in
would break with widely accepted important feature of the NDEIM, which Table VI–F–2, however, as an additional
economic practice for this type of allows it to link the separate market cost to producers. This is appropriate
analysis.247 components of the model and simulate because even though firms currently
d. Model Inputs—Elasticities how compliance costs can be expected allocated funds to R&D those resources
to ripple through the affected economic are intended for other purposes such as
The estimated social costs of this sectors. In the real world, for example, increasing engine power, ease of use, or
emission control program are a function the quantity of nonroad equipment units comfort. These improvements will
of the ways in which producers and produced in a particular period depends therefore be postponed for the length of
consumers of the engines, equipment, on the price of engines (the engine the rule-related R&D program. This is a
and fuels affected by the standards market) and the demand for equipment cost to society.
change their behavior in response to the (the application markets). Similarly, the One commenter recommended that
costs incurred in complying with the number of engines produced depends EPA include engine and equipment R&D
standards. As the compliance costs on the demand for engines (the (fixed) costs in the market analysis. This
ripple through the markets, producers commenter argued that while in the
and consumers change their production 248 If the elasticity of demand for a final product long run total costs are not determined
and purchasing decisions in response to is less than the elasticity of substitution between an by changes in fixed costs, total costs are
changes in prices. In the NDEIM, these input and other inputs to the final product, then the
determined initially by both fixed and
behavioral changes are modeled by the demand for the input is less elastic the smaller its
cost share. Hicks, J.R., 1961. Marshall’s Third Rule: variable costs. This commenter was
demand and supply elasticities A Further Comment. Oxford Economic Papers concerned that by not including fixed
13:262–65; Hicks, J.R., 1963. The Theory of Wages. costs, EPA’s analysis underestimates the
247 See, for example, EPA Guidelines for St. Martins Press, NY, pp. 233–247. See Docket A–
Preparing Economic Analyses, EPA 240–R–00–003, 2001–28, Document No. IV–B–25 for relevant
increase in the average price of goods
September 2000, p 126. See also the Final RIA for excerpts. See Docket A–2001–28, Document No. IV– and services produced using engines
this rule, Chapter 10, Section 10.2.3.1. B–25 for relevant excerpts. affected by the rule. In fact, we included
R&D costs in a sensitivity analysis equipment. It should be noted that this equipment is an alternative only for the
performed for the draft EIA, which has effect is limited to equipment and does smaller power categories (below 75 hp).
been updated and can be found in not extend to nonroad diesel fuel. We Based on discussions with equipment
Appendix I to Chapter 10 of the Final believe that equipment pre-buying will manufacturers and users, the dominant
RIA. Including fixed costs results in a not be economically viable in most reasons for choosing diesel engines over
transfer of economic welfare losses from cases due to the cost of holding capital the substantially less expensive gasoline
engine and equipment markets to the (equipment) idle and of maintaining engines include better performance from
application markets (engine and unused equipment. Such strategic diesel engines, lower fuel consumption
equipment producer surplus losses purchases, if they occur at all, would be from diesel engines, and the ability to
decrease; consumer surplus losses limited to a period of a few months use diesel fuel. The use of diesel fuel is
increase), but does not change the before the effective date of the preferable for two reasons: it is safer to
overall economic welfare losses standards. The NDEIM models market store and dispense, and it is compatible
associated with the rule. reactions in the intermediate time with the fuel needed for larger
Unlike for engines and equipment, frame, beyond the scope of any potential equipment at the same worksite. Where
most of the petroleum refinery fixed pre-buy. For these reasons, we do not these issues are not a concern, gasoline
costs are for production hardware. believe it is appropriate to revise the engines already enjoy a substantial
Refiners are expected to have to make model to include pre-buy as a means of economic advantage over diesel. We do
physical changes to their refineries and substitution in NDEIM. not believe that the incremental increase
purchase additional equipment to ‘‘Delayed-buying’’ appears to refer to in new equipment cost associated with
produce 500 ppm and then 15 ppm fuel. the possibility that suppliers in the this program would provide the
Therefore, fixed costs are included in application market would defer necessary economic incentives for
the market analysis for fuel price and purchasing new equipment initially but switching to gasoline equipment.
quantity impacts. would eventually make those purchases. Equipment users who can use gasoline-
Similarly to pre-buying, this appears to fueled equipment already do so, while
f. Model Inputs—Substitution by
be a short-term effect and would those who can’t due to the high costs of
Application Suppliers
therefore be inappropriate to include in storing and dispensing gasoline fuel
In modeling the market impacts and an economic model designed to model already use diesel engines. Therefore,
social costs of this rule, the NDEIM the intermediate time frame. we have not attempted to model the
considers only diesel equipment and Extending the life of a current possibility of substitution to gasoline
fuel inputs to the production of goods machine is suggested as another equipment in NDEIM.
in the applications markets. It does not alternative to purchasing new
explicitly model alternate production equipment. We believe this would also g. Model Inputs—Other
inputs that would serve as substitutes be a short term phenomena that is not
for new nonroad equipment or nonroad relevant for the intermediate time frame Compliance Costs. The NDEIM uses
diesel fuel. In the model, market of the NDEIM. Based on our meetings the estimated engine, equipment, and
changes in the final demand for with equipment users and suppliers, we fuel compliance costs described in
application goods and services directly do not believe that extending the life of above and presented in Chapters 6 and
correspond to changes in the demand nonroad equipment will prove to be an 7 of the RIA. Engine and equipment
for nonroad equipment and fuel (i.e., in economically viable substitute in the costs vary over time because fixed costs
normalized terms there is a one-to-one near or long term. Most users of nonroad are recovered over five to ten year
correspondence between the quantity of equipment already extend the life of periods while total variable costs,
the final goods produced and the their equipment to the maximum extent despite learning effects that serve to
quantity of nonroad diesel equipment possible and purchase new equipment reduce costs on a per unit basis,
and fuel used as inputs to that only when the existing equipment can continue to increase at a rate consistent
production). We believe modeling the no longer perform its function, when with new sales increases. Similarly,
market in this manner is economically new demand for production requires engine operating costs also vary over
sound and reflects the general additional means for production, or time because oil change maintenance
experience for the nonroad market. when new equipment offers a cheaper savings, PM filter maintenance, and fuel
Some commenters suggested that the means of production than existing economy effects, all of which are
NDEIM should consider substitution to equipment. This situation is not calculated on the basis of gallons of fuel
alternate means of production such as expected to change as a result of this consumed, change over time consistent
pre-buying, delayed buying, extending rule. In addition, even if it were possible with the growth in nationwide fuel
the life of a current machine, and to extend equipment life even more, this consumption. Fuel-related compliance
substituting with different (e.g., would lower the cost of nonroad costs (costs for refining and distributing
gasoline-powered) equipment. These equipment as an input to production regulated fuels) also change over time.
commenters did not provide detailed (because it would be less expensive to These changes are more subtle than the
explanations for their comments or data maintain old equipment than purchase engine costs, however, as the fuel
in support of their substitution new equipment) and thus would reduce provisions are largely implemented in
arguments. After considering these the economic impact of the Tier 4 discrete steps instead of phasing in over
comments, we conclude that revising program compared to our estimate. For time. Compliance costs were developed
the NDEIM to include these effects all of the reasons stated here, we have on a ¢/gallon basis; total compliance
would be inappropriate. decided not to attempt to model an costs are determined by multiplying the
The term ‘‘pre-buying’’ appears to extended equipment life alternative in ¢/gallon costs by the relevant fuel
refer to the possibility that the suppliers the NDEIM. volumes. Therefore, total fuel costs
in the application market may choose to Finally, some commenters noted that increase as the demand for fuel
buy additional unneeded quantities of equipment users may chose to substitute increases. The variable operating costs
nonroad equipment prior to the with different equipment, particularly are based on the natural gas cost of
beginning of the Tier 4 program, thus gasoline-powered equipment. We producing hydrogen and for heating
avoiding the higher cost for the Tier 4 believe substitution to gasoline-powered diesel fuel for the new desulfurization
equipment, and thus would fluctuate diesel product line and not just to all engines, equipment, and fuels. It
along with the price of natural gas. heating oil. should be noted that, as illustrated in
Operating Savings. Operating savings Fuel Spillover. Spillover fuel is Table VI–F–3, aggregate program costs
refers to changes in operating costs that highway grade diesel fuel consumed by peak in 2014; increases in costs after
are expected to be realized by users of nonroad equipment, stationary diesel that year are due to increases in the
both existing and new nonroad diesel engines, boilers, and furnaces. As population of engines over time. The
equipment as a result of the reduced described in Section 7.1 of Chapter 7 of other years, 2020, 2030 and 2036,
sulfur content of nonroad diesel fuel. the final RIA, refiners are expected to correspond to years analyzed in our
These include operating savings (cost produce more 15 ppm fuel than is benefits analysis. Detailed results for all
reductions) due to fewer oil changes, required for the highway diesel market. years are included in the appendices to
which accrue to nonroad, marine and This excess 15 ppm fuel will be sold Chapter 10 of the RIA.
locomotive engines that are already in into markets that allow fuel with a In the following discussion, social
use as well as new nonroad engines that higher sulfur level (i.e., nonroad for a costs are computed as the sum of market
will comply with the standards (see limited period of time, locomotive, surplus offset by operating savings.
Section VI.B). These also include any marine diesel and heating oil). This Market surplus is equal to the aggregate
extra operating costs associated with the spillover fuel is affected by the diesel change in consumer and producer
new PM emission control technology highway rule and is not affected by this surplus based on the estimated market
which may accrue to certain new regulation. Therefore, it is important to impacts associated with the rule. As
engines that use this technology. differentiate between spillover and explained above, operating savings are
Operating savings are not included in nonspillover fuel to ensure that the not included in the market analysis but
the market analysis because some of the compliance costs for that fuel pool are instead are listed as a separate category
savings accrue to existing engines and not counted twice. In the NDEIM, this in the social cost results tables.
because, as explained in Section is done by incorporating the impact of In considering the results of this
VI.C.1.c, these savings are not expected increased fuel costs associated with the analysis, it should be noted that the
to affect consumer decisions with highway rule prior to analysis of the estimated output quantities for diesel
respect to new engines. Operating final nonroad rule (see RIA Section engines, equipment, and fuel are not
savings are included in the social cost 10.3.8). identical to those estimated in the
analysis, however, because they accrue Compliance Flexibility Provisions. engineering cost described in above and
to society. They are added into the Consistent with the engine and presented in Chapters 6 and 7 of the
estimated social costs as an additional equipment cost discussion in Section RIA. The difference is due to the
savings to the application and VI.C, the EIA does not include any cost different methodologies used to estimate
transportation service markets, since it savings associated with the equipment these costs. As noted above, social costs
is the users of these engines and fuels transition flexibility program or the are the value of goods and services lost
who will see these savings. A sensitivity nonroad engine ABT program. As a by society resulting from: (a) the use of
analysis was performed as part of this result, the results of this EIA can be resources to comply with and
EIA that includes the operating savings viewed as somewhat conservative. implement a regulation (i.e., compliance
in the market analysis. The results of Locomotive and Marine Fuel Costs. costs); and (b) reductions in output.
this sensitivity analysis are presented in The locomotive and marine Thus, the social cost analysis considers
Appendix 10.I. transportation sectors are affected by both price and output (quantity) effects
Fuel Marker Costs. Fuel marker costs this rule through the sulfur limits on the associated with consumer and producer
refers to costs associated with marking diesel fuel used by these engines. These reaction to increased prices associated
high sulfur heating oil to distinguish it sectors provide transportation to the with the regulatory compliance costs.
from high sulfur diesel fuel produced three application markets as well as to The engineering cost analysis, on the
after 2007 through the use of early other markets not considered in the other hand, is based on applying
sulfur credits or small refiner NDEIM (e.g., public utilities, additional technology to comply with
provisions. Only heating oil sold nonmanufacturing service industries, the new regulations. The engine
outside of the Northeast is affected. The government). As explained in Section population in the engineering cost
higher sulfur NRLM fuel is not allowed 10.3.1.5 of the RIA, the NDEIM applies analysis does not reflect consumer and
to be sold in most of the Northeast, so only a portion of the locomotive and producer reactions to the compliance
the marker need not be added in this marine fuel costs to the three costs. Consequently, the estimated
large heating oil market. These costs are application markets. The rest of the output quantities from the cost analysis
expected to be about $810,000 in 2007, locomotive and marine fuel costs are are slightly larger than the estimated
increasing to $1.38 million in 2008, but added as a separate item to the total output quantities from the social cost
steadily decreasing thereafter to about social cost estimates (as Application analysis.
$940,000 in 2040 (see Chapter 10 of the Markets Not Included in NDEIM). The results of this analysis suggest
RIA). Because these costs are relatively that the economic impacts of this rule
small, they are incorporated into the 3. What Are the Results of this are likely to be small, on average. Price
estimated compliance costs for the fuel Analysis? increases in the application markets are
program (see discussion of fuel costs, Using the revised cost data described expected to average about 0.1 percent
above). They are therefore not counted earlier in this section and the NDEIM per year. Output decrease in the
separately in this economic impact described above and in Chapter 10 of application markets are expected to
analysis. This means that the costs of the Final RIA, we estimated the average less than 0.02 percent for all
marking heating fuel are allocated to all economic impacts of the nonroad years. The price increases for engines,
users of the fuel affected by this rule engine, equipment and fuel control equipment, and fuel are expected to be
(nonroad, locomotive, and marine) program. Economic impact results for about 20 percent, 3 percent, and 7
instead of uniquely to heating oil users. 2013, 2020, 2030, and 2036 are percent, respectively (total impact
This is a reasonable approach since it is presented in this section. The first of averaged over the relevant years). The
likely that refiners will pass the marker these years, 2013, corresponds to the number of engines and equipment
costs along their complete nonroad first year in which the standards affect produced is expected to decrease by less
than 250 units, and the amount of fuel The market impacts of this rule construction, agricultural, or
produced annually is expected to suggest that the overall economic manufactured goods).
decrease by less than 4 million gallons. impact of the emission control program Equipment Market Results: Estimated
With respect to the economic welfare on society is expected to be small, on price changes for the equipment markets
analysis, producers and consumers in average. According to this analysis, the reflect both the direct costs of the new
the application markets are expected to average prices of goods and services standards on equipment production and
bear about 83 percent of the burden in produced using equipment and fuel the indirect cost through increased
2013; this will increase to about 96 affected by the rule are expected to engine prices. In general, the estimated
percent in 2030 and beyond. In other increase by about 0.1 percent (as noted percentage price changes for the
words, despite the almost total pass- above), despite the almost total pass- equipment are less than that for engines
through of costs the average price of through of compliance costs to those because the engine is only one input in
goods and services in the application markets. the production of equipment. In 2013,
markets is expected to increase by only Engine Market Results: This analysis the average price increase for nonroad
0.1 percent. This outcome reflects the suggests that most of the variable costs diesel equipment is estimated to be
fact that diesel engines, equipment, and associated with the rule will be passed about 2.9 percent.250 This percentage is
fuel are only a small part of total costs along in the form of higher prices. The expected to decrease to about 2.5
for the application markets. These average price increase in 2013 for percent for 2020 and beyond. The range
results are described in more detail engines is estimated to be about 21.4 of estimated price increases across
below and in Chapter 10 of the Final percent. This percentage is expected to equipment types parallels the share of
RIA. decrease to about 18.3 percent by 2020. engine costs relative to total equipment
In 2036, the last year considered, the price, so the estimated percentage price
a. Expected Market Impacts increase among equipment types also
average price increase is expected to be
The estimated market impacts for varies. For example, the market price in
about 18.2 percent. This expected price
2013, 2020, and 2030 are presented in 2013 for agricultural equipment
Table VI.F–1. The market-level impacts increase varies by engine size because
between 175 and 600 hp is estimated to
presented in this table represent compliance costs are a larger share of
increase about 1.2 percent, or $1,740 for
production-weighted averages of the total production costs for smaller
equipment with an average cost of
individual market-level impact engines. In 2013, the largest expected
$143,700. This compares with an
estimates generated by the model: the percent price increase is for engines
estimated engine price increase of about
average expected price increase and between 25 and 50 hp: 29 percent or
$1,700 for engines of that size. The
quantity decrease across all of the units $850; the average price for an engine in
largest expected price increase in 2013
in each of the engine, equipment, fuel, this category is about $2,900. However,
for equipment is $2,290, or 2.6 percent,
and final application markets. For this price increase is expected to drop
for pumps and compressors over 600
example, the model includes seven to 22 percent, or about $645, for 2015
hp. This compares with an estimated
individual engine markets that reflect and later. The smallest expected percent engine price increase of about $2,240 for
the seven different horsepower size price increase in 2013 is for engines in engines of that size. The smallest
categories. The 21.4 percent price the greater than 600 hp category. These expected price increase in 2013 for
change for engines shown in Table engines are expected to see price equipment is $120, or 0.7 percent, for
VI.F–1 for 2013 is an average price increases of about 3 percent increase in construction equipment less than 25 hp.
change across all engine markets 2013, increasing to about 7.6 percent in This compares with an estimated engine
weighted by the number of production 2015 and then decreasing to about 6.6 price increase of about $120 for engines
units. Similarly, the equipment impacts percent in 2017 beyond. The expected of that size.
presented in Table VI.F–1 are the price increase for these engines is about Again, the market analysis predicts
weighted averages of 42 equipment- $2,240 in 2013, increasing to about that even with these increased
application markets, such as small $6,150 in 2015 and then decreasing to equipment prices total demand is not
(<25hp) agricultural equipment and $5,340 in 2017 and later, for engines expected to change very much. The
large (>600hp) industrial equipment. that cost on average about $80,500. expected average change in quantity is
Note that price increases and quantity The market impact analysis predicts less than 250 pieces of equipment per
decreases for specific types of engines, that even with these increased in engine year, out of a total sales of more than
equipment, application sectors, or diesel prices, total demand is not expected to 500,000 units. The average decrease in
fuel markets are likely to be different. change very much. The expected the quantity of nonroad diesel
The aggregated data presented in this average change in quantity is less than equipment produced as a result of the
table provide a broad overview of the 150 engines per year, out of total sales regulation is estimated to be about 0.02
expected market impacts that is useful of more than 500,000 engines. The percent for all years. The largest
when considering the impacts of the estimated change in market quantity is expected decrease in quantity in 2013 is
rule on the economy as a whole. The small because as compliance costs are 18 units of construction equipment per
individual market-level impacts are passed along the supply chain they year for construction equipment
presented in Chapter 10 of the Final become a smaller share of total between 100 and 175 hp, out of about
RIA.249 production costs. In other words, firms 63,000 units. The smallest expected
that use these engines and equipment decrease in quantity in 2013 is less than
249 The NDEIM distinguishes between
will continue to purchase them even at
‘‘merchant’’ engines and ‘‘captive’’ engines. the higher cost because the increase in 250 It should be noted that the equipment prices
‘‘Merchant’’ engines are produced for sale to used in this analysis reflect current market
another company and are sold on the open market costs will not have a large impact on conditions. An increase in equipment prices
to anyone who wants to buy them. ‘‘Captive’’ their total production costs (diesel associated with the nonroad Tier 3 standards would
engines are produced by a manufacturer for use in equipment is only one factor of reduce size of the percentage increase in price. In
its own nonroad equipment line (this equipment is production for their output of this sense, our Economic Impact Analysis is
said to be produced by ‘‘integrated’’ manufacturers). conservative as it is based on the impact of the Tier
The market analysis for engines includes 4 program on Tier 1 and Tier 2 equipment prices
compliance costs for merchant engines only. The compliance costs plus a portion of the engine and therefore overestimates the market impacts of
market analysis for equipment includes equipment compliance costs attributable to captive engines. the Tier 4 program.
one unit per year in all hp categories of because the absolute change in the integrated engine/equipment
pumps and compressors. quantity of engines represents only manufacturers are not reflected in this
It should be noted that the absolute engines sold on the market. Reductions number but are captured in the cost
change in the number of engines and in engines consumed internally by analysis.
equipment does not match. This is
TABLE VI.F– 1.— SUMMARY OF MARKET IMPACTS ($2002)

Engineering Change in price Change in quantity
cost
Market Absolute Percent Absolute Percent
Per unit ($million)
2013
Engines .................................................................................................... $1,052 $821 21.4 a ¥79 ¥0.014

Equipment ................................................................................................ 1,198 975 2.9 ¥139 ¥0.017
Loco/Marine Transp b ............................................................................... .................... .................... 0.009 .................... ¥0.007
Application Markets b ............................................................................... .................... .................... 0.097 .................... ¥0.015
No. 2 Distillate Nonroad ........................................................................... 0.06 0.07 6.0 c ¥2.75 ¥0.019
2020
Engines .................................................................................................... 950 761 18.3 a ¥98 ¥0.016

Equipment ................................................................................................ 1,107 976 2.5 ¥172 ¥0.018
2030
Engines .................................................................................................... 937 751 18.2 a ¥114 ¥0.016

Equipment ................................................................................................ 968 963 2.5 ¥200 ¥0.018
2036
Engines .................................................................................................... 931 746 18.2 a ¥124 ¥0.016

Equipment ................................................................................................ 962 956 2.5 ¥216 ¥0.018
Notes:
a The absolute change in the quantity of engines represents only engines sold on the market. Reductions in engines consumed internally by in-
tegrated engine/equipment manufacturers are not reflected in this number but are captured in the cost analysis. For this reason, the absolute
change in the number of engines and equipment does not match.
b The model uses normalized commodities in the application markets because of the great heterogeneity of products. Thus, only percentage
changes are presented.
c Units are in million of gallons.
Transportation Market Results: The averages about 0.1 percent for all years. application market to about 0.5 percent
estimated price increase associated with In other words, on average, the prices of in the construction market. The
the proposed standards in the goods and services produced using the percentage change in output is also
locomotive and marine transportation affected engines, equipment, and fuel estimated to be very small and averages
markets is negligible, at 0.01 percent for are expected to increase negligibly. This less than 0.02 percent for all years. Note
all years. This means that these results from the observation that that these estimated price increases and
transportation service providers are compliance costs passed on through quantity decreases are average for these
expected to pass along nearly all of their price increases represent a very small sectors and may vary for specific
increased costs to the agriculture, share of total production costs in all the subsectors. Also, note that absolute
construction, and manufacturing application markets. For example, the changes in price and quantity are not
application markets, as well as other construction industry realizes an provided for the application markets in
application markets not explicitly increase in production costs of Table VI.F–1 because normalized
modeled in the NDEIM. This price approximately $580 million in 2013 commodity values are used in the
increases represent a small share of total because of the price increases for diesel market model. Because of the great
application market production costs, equipment and fuel. However, this heterogeneity of manufactured or
and therefore are not expected to affect represents less than 0.001 percent of the agriculture products, a normalized
demand for these services. $820 billion value of shipments in the commodity ($1 unit) is used in the
Application Market Results: The construction industry in 2000. The application markets. This has no impact
estimated price increase associated with estimated average commodity price on the estimated percentage change
the new standards in all three increase in 2013 ranges from 0.08 impacts but makes interpretation of the
application markets is very small and percent in the manufacturing absolute changes less informative.
Fuel Markets Results: The estimated total social costs. Engine manufacturers the engine and equipment populations.
average price increase across all and diesel fuel refineries are expected to Producers and consumers in the
nonroad diesel fuel is about 7 percent bear 2.8 percent and 0.5 percent, application markets are expected to bear
for all years. For 15 ppm fuel, the respectively. The remaining 4.2 percent an even larger portion of the costs,
estimated price increase for 2013 ranges of the social costs is expected to be approximately 96 percent. This is
from 5.6 percent in the East Coast region borne by the locomotive and marine consistent with economic theory, which
(PADD 1&3) to 9.1 percent in the transportation service sector. In this last states that, in the long run, all costs are
mountain region (PADD 4). The average sector, about 97 percent of the gross passed on to the consumers of goods
national output decrease for all fuel is decrease in market surplus is expected and services.
estimated to be about 0.02 percent for to be borne by the application markets
The present value of total social costs
all years, and is relatively constant that are not included in the NDEIM but
across all four regional fuel markets. that use these services (e.g., public through 2036, contained in Table VI.F–
utilities, nonmanufacturing service 3, is estimated to be $27.2 billion
b. Expected Economic Welfare Impacts ($2002). This present value is calculated
industries, government) while about 3
Estimated social costs are presented percent is expected to be borne by using a social discount rate of 3 percent
in Table VI.F–2. In 2013, the total social locomotive and marine service from 2004 through 2036. We also
costs are projected to be about $1,510 providers. Because of the way the performed an analysis using a 7 percent
million ($2002). About 83 percent of the NDEIM is structured, with the fuel social discount rate. Using that discount
total social costs is expected to be borne savings added separately, the results rate, the present value of the social costs
by producers and consumers in the imply that locomotive and marine through 2036 is estimated to be $13.9
application markets in 2013, indicating service provider would see net benefits billion ($2002). As shown in Table
that the majority of the compliance costs from the rule due to the operating VI.F–3, these results suggest that total
associated with the rule are expected to savings associated with low sulfur fuel. engineering costs exceed compliance
be passed on in the form of higher In fact, they are likely to pass along costs by a small amount. This is due
prices. When these estimated impacts some or all of those operating savings to primarily to the fact that the estimated
are broken down, about 58.5 percent of the users of their services, reducing the output quantities for diesel engines,
the social costs are expected to be borne size of the welfare losses for those users. equipment, and fuel are not identical to
by consumers in the application markets Total social costs continue to increase those estimated in the engineering cost
and about 41.5 percent are expected to over time and are projected to be about analysis, which is due to the different
be borne by producers in the application $2,046 million by 2030 and $2,227 methodologies used to estimate these
markets. Equipment manufacturers are million in 2036 ($2002). The increase is costs (see previous discussion in this
expected to bear about 9.5 percent of the due to the projected annual growth in Section IV.F.3).
TABLE VI.F– 2.— SUMMARY OF SOCIAL COSTS ESTIMATES ASSOCIATED WITH PRIMARY PROGRAM 2015, 2020, 2030, AND
2036
[2002, $Million]a, b
Operating
Market sur- savings Total Percent
plus ($10 6) ($10 6)
2013
Engine Producers Total ................................................................................................... $42.0 .................... $42.0 2.8

Equipment Producers Total ............................................................................................. 143.1 .................... 143.1 9.5
Construction Equipment ........................................................................................... 64.0 .................... 64.0 ....................
Agricultural Equipment ............................................................................................. 51.8 .................... 51.8 ....................
Industrial Equipment ................................................................................................. 27.2 .................... 27.2 ....................
Application Producers & Consumers Total ..................................................................... 1,496.7 ($243.2) 1,253.5 83.0
Total Producer .......................................................................................................... 620.9 .................... .................... 41.5
Total Consumer ........................................................................................................ 875.7 .................... .................... 58.5
Construction .............................................................................................................. 584.3 ($115.2) 469.2 ....................
Agriculture ................................................................................................................. 430.0 ($78.2) 351.8
Manufacturing ........................................................................................................... 482.4 ($49.8) 432.5 ....................
Fuel Producers Total ....................................................................................................... 8.0 .................... 8.0 0.5
PADD I&III ................................................................................................................ 4.1 .................... 4.1 ....................
PADD II ..................................................................................................................... 3.3 .................... 3.3 ....................
PADD IV ................................................................................................................... 0.0 .................... 0.0 ....................
PADD V .................................................................................................................... 0.6 .................... 6.0 ....................
Transportation Services, Total ......................................................................................... 104.9 ($41.5) 63.4 4.2
Locomotive ............................................................................................................... 1.6 ($12.4) ($10.8) ....................
Marine ....................................................................................................................... 0.9 ($9.9) ($9.0) ....................
Application markets not included in NDEIM ............................................................. 102.4 ($19.2) $83.2 ....................
Total ................................................................................................................... 1,794.7 ($284.7) $1,510.0 100.0%
2020
.
Engine Producers Total ................................................................................................... 0.1 .................... 0.1 0.0
2036— Continued
Operating
plus ($10 6) ($10 6)

Total Producer .......................................................................................................... 762.2 .................... .................... 41.7
Total Consumer ........................................................................................................ 1,063.8 .................... .................... 58.3
Construction .............................................................................................................. 744.0 ($91.1) 653.0 ....................
Agriculture ................................................................................................................. 524.3 ($61.8) 462.5 ....................
Manufacturing ........................................................................................................... 557.8 ($39.4) 518.3 ....................
PADD I&III ................................................................................................................ 5.6 .................... 5.6 ....................
PADD II ..................................................................................................................... 4.6 .................... 4.6 ....................
PADD IV ................................................................................................................... 0.2 .................... 0.2 ....................
PADD V .................................................................................................................... 0.8 .................... 0.8
Locomotive ............................................................................................................... 2.0 ($7.2) ($5.2) ....................
Marine ....................................................................................................................... 1.1 ($11.6) ($10.5) ....................
Application markets not included in NDEIM ............................................................. 92.6 ($16.3) 76.3 ....................
Total ................................................................................................................... 2,055.7 ($227.4) $1,828.3 100.0%
2030

Total Producer .......................................................................................................... 882.2 .................... .................... 41.7
Total Consumer ........................................................................................................ 1,230.1 .................... .................... 58.3
Construction .............................................................................................................. 863.8 ($73.0) 790.8 ....................
Agriculture ................................................................................................................. 606.8 ($49.6) 557.2 ....................
Manufacturing ........................................................................................................... 641.6 ($31.6) 610.0 ....................
PADD I&III ................................................................................................................ 6.7 .................... 6.7 ....................
PADD II ..................................................................................................................... 5.2 .................... 5.2 ....................
PADD IV ................................................................................................................... 0.3 .................... 0.3 ....................
PADD V .................................................................................................................... 1.0 .................... 1.0 ....................
Locomotive ............................................................................................................... 2.5 ($7.8) ($5.3) ....................
Marine ....................................................................................................................... 1.4 ($13.6) ($12.2) ....................
Total ................................................................................................................... 2,240.6 ($194.1) $2,046.4 100.0%
2036

Total Producer .......................................................................................................... 955.5 .................... .................... 41.7
Total Consumer ........................................................................................................ 1,331.9 .................... .................... 58.3
Construction .............................................................................................................. 936.4 ($50.0) 862.7 ....................
Agriculture ................................................................................................................. 657.8 ($73.7) 607.8 ....................
Manufacturing ........................................................................................................... 693.2 ($31.9) 661.3 ....................
PADD I&III ................................................................................................................ 7.3 .................... 7.3 ....................
PADD II ..................................................................................................................... 5.8 .................... 5.8 ....................
PADD IV ................................................................................................................... 0.3 .................... 0.3 ....................
PADD V .................................................................................................................... 1.0 .................... 1.0 ....................
Locomotive ............................................................................................................... 2.8 ($8.2) ($5.4) ....................
Marine ....................................................................................................................... 1.6 ($14.6) ($13.0) ....................
2036— Continued
Operating
plus ($10 6) ($10 6)
Total ................................................................................................................... $2,425.3 ($198.4) $2,227.0 100.0

Notes: a Figures are in 2002 dollars.
b Operating savings are shown as negative costs.
TABLE VI.F– 3.— NATIONAL ENGINEER- standards. This section presents a standard was set first at 500 ppm and
ING COMPLIANCE COSTS AND SO- summary of those alternative program then was reduced to 15 ppm. The two-
CIAL COSTS ESTIMATES FOR THE options and our reasons for either step alternatives varied from the
RULE (2004– 2036) adopting or not adopting these options. proposed program in terms of both the
timing and levels of the engine
[$2002; $Million] A. Summary of Alternatives
standards and the timing of the fuel
For our Notice of Proposed standards. Option 2a was the same as
Engineering Rulemaking (NPRM), we developed
Year compliance Total social the proposed program except the 500
costs costs emissions, benefits, and cost analyses ppm fuel standard was introduced a
for a number of alternative program year earlier, in 2006. Option 2b was the
2004 0 0 options involving variations in both the same as the proposed program except
2005 0 0 fuel and engine programs. The the 15 ppm fuel standard was
2006 0 0 alternatives we considered can be introduced a year earlier (in 2009) and
2007 ($17) ($18) categorized according to the structure of the trap-based PM standards began
2008 54 54 their fuel requirements: whether the 15
2009 54 54 earlier for all engines. Option 2c was the
ppm fuel sulfur limit for nonroad diesel same as the proposed program except
2010 328 327
2011 923 922 fuel is reached in two steps, like the the 15 ppm fuel standard was
2012 1,305 1,304 program we are finalizing today, or in introduced a year earlier in 2009 and
2013 1,511 1,510 one step. Within each of these two the trap-based PM standards began
2014 1,691 1,690 broad fuel program categories, we earlier for engines 175–750 hp. Option
2015 1,742 1,741 considered a number of different engine 2d was the same as the proposed
2016 1,743 1,743 programs. This section summarizes the program except the NOX standard was
2017 1,763 1,762 alternatives. A more detailed reduced to 0.30 g/bhp-hr for engines of
2018 1,778 1,778
description of the alternatives can be 25–75 hp, and this standard was phased
2019 1,795 1,795
2020 1,829 1,828 found in the NPRM and the draft RIA. in. Finally, Option 2e was the same as
2021 1,816 1,815 One-step alternatives were those in the proposed program except there were
2022 1,819 1,818 which the 15 ppm fuel sulfur standard no new Tier 4 NOX limits.
2023 1,844 1,843 for nonroad diesel fuel is applied in a In the NPRM, option 3 was identical
2024 1,858 1,857 single step. We evaluated three one-step to the proposed program, except that it
2025 1,888 1,887 alternatives, summarized in table VII–1. would have exempted mining
2026 1,921 1,920 Option 1 represented an engine program equipment over 750 hp from the Tier 4
2027 1,954 1,952 that was similar to that in our proposed standards. We explained in detail in
2028 1,985 1,984
2029 2,017 2,016
program, the primary difference being section 12.6.2.2.7 of the draft RIA that
2030 2,047 2,046 the generally earlier phase-in dates for we had very serious reservations
2031 2,078 2,077 the PM standards. We considered the regarding the legality of this option
2032 2,108 2,107 Option 1 engine program as being the given these engines’ high emission rates
2033 2,139 2,137 most stringent one-step program that of PM, NOX and NMHC and the
2034 2,169 2,167 could be considered even potentially availability of further emissions control
2035 2,198 2,197 feasible considering cost, lead-time, and at reasonable cost. We adhere to these
2036 2,228 2,227 other factors. Option 1 also included a conclusions here. We do note, however,
NPV at 3% 27,247 27,232 June 2008 start date for the 15 ppm that we are adopting somewhat different
NPV at 7% 13,876 13,868
sulfur standard applicable to nonroad provisions for this engine category than
diesel fuel and the 500 ppm sulfur we proposed. As explained in sections
VII. Alternative Program Options standard applicable to locomotive and II.A. and II.B above, although we have
Considered marine fuel. We also considered two adopted aftertreatment-based PM
Our final emission control program other one-step alternatives which differ standards for these engines, the
for nonroad engines and equipment from Option 1. As described in table standards are slightly higher than those
consists of a two-step program to reduce VII–1, Option 1b differed from Option 1 proposed to assure their technical
the sulfur content of nonroad diesel fuel regarding the timing of the fuel feasibility. We also have deferred a
in conjunction with Tier 4 engine standards, while Option 1a differed decision on whether to adopt
standards. The rule also contains limits from Option 1 in terms of the engine aftertreatment-based standards for NOX
on sulfur levels in locomotive and standards. Options 1a and 1b also for mobile machines with engines
marine diesel fuel. As described in the differed from Option 1 by extending the greater than 750 hp. We also have
draft Regulatory Impact Analysis for the 15 ppm fuel sulfur limit to locomotive provided ample lead time for these
proposal, we evaluated a number of and marine diesel fuel. engines to comply with the Tier 4
alternative options with regard to the Two-step alternatives were those in standards, both in terms of the rule’s
scope, level, and timing of the which the nonroad diesel fuel sulfur compliance dates (which include a 2015
date for the final Tier 4 standards, one would continue indefinitely. The emissions control from these engines.
year later than we proposed) and the Option 5b program was identical to the We thus do not see a basis in law or
ABT and equipment manufacturer proposed program except that for policy to adopt either of these options.
flexibilities. This lead time takes into engines under 75 hp only the 2008 In response to comments on our
account the long design periods, high engine standards would be set, i.e. there NPRM we also investigated a number of
cost, and low sales volumes of these would be no additional PM filter-based other variations in the engine standards
engines. Thus, although we strongly standard in 2013 for 25–75 hp engines, as we developed our final rule. These
disagree with the option of not adopting and no additional NOX + NMHC variations were generally related to the
Tier 4 standards for these engines, we standard in 2013 for 25–50 hp engines. phase-in of engine standards in a
do recognize their need for unique We are not adopting Options 5a or 5b number of different horsepower
standards and compliance dates. in today’s action. As explained at 8.2.3 categories. A discussion of these
Option 4 included applying the 15 of the Summary and Analysis of variations is provided in section II as
ppm sulfur limit to both locomotive and Comments, and in sections 12.6.2.2.9 well as in various background
marine diesel fuel in addition to and 12.6.2.2.10 of chapter 12 of the draft documents.
nonroad fuel. On the basis of comments RIA, these options would forego Table VII–1 contains a summary of a
received and additional analyses, we substantial PM and NOX + NMHC number of these alternatives. The
have determined that a 15ppm sulfur emission reductions (on the order of expected emission reductions, costs,
standard for locomotive and marine fuel hundreds of thousands of tons of each and monetized benefits associated with
is appropriate, though we have included pollutant) which are feasible at them in comparison to the proposed
certain options for utilization of off- reasonable cost. We note further that program were evaluated for the NPRM.
specification fuel and transmix not many of these smaller engines operate Those analyses were not revised for this
represented in our original Option 4. in populated areas and in equipment final rulemaking to reflect changes in
This aspect of our final program is without closed cabs—in mowers, small our empirical models or assumptions.
discussed in detail in section IV. construction machines, and the like— We received no new information that
Options 5a and 5b were identical to where personal exposures to toxic would cause us to believe that the
the proposed program except with emissions (both PM and air toxics relative impacts and differences for
respect to standards for engines less which are part of the NMHC fraction) those alternative program options
than 75 hp. Option 5a was identical to may be pronounced well beyond what relative to our final program would
the proposed program except that no is indicated simply by a comparison of change enough to make an impact on
new program requirements would be set nationwide emissions inventory our assessments of the feasibility or
in Tier 4 for engines under 75 hp. estimates. We would also emphasize the appropriateness of the options. The
Instead, Tier 2 standards and testing remarkable growth in recent sales and remainder of this section will
requirements for engines under 50 hp, usage for these smaller diesel machines, summarize some of the comments we
and Tier 3 standards and testing and we expect this trend to continue, received on the options and our
requirements for 50–75 hp engines, pointing up the need for effective PM responses to those comments.
TABLE VII– 1.— SUMMARY OF ALTERNATIVE PROGRAM OPTIONS

Option Fuel Standards Engine Standards a
Final program
• 500 PPM in 2007 for NR, loco/marine ........................................ • <75 hp: PM standards in 2008
• 15 ppm in 2010 for NR ................................................................ • 25– 75 hp: PM AT-based standards in 2013
• 15 ppm in 2012 for loco/marine .................................................. • 75– 175 hp: PM AT-based standards in 2012
• 175– 750 hp: PM AT-based standards in 2011
• 75– 175 hp: NOX AT-based standards phase-in 2012– 2014
• 175– 750 hp: NOX AT-based standards phase-in 2011– 2014
• >750 hp: PM and NOX AT phased-in 2011 and 2015
1-Step Fuel Options
1 ........... • 15 ppm in 2008 for NR and loco/marine ..................................... • <50 hp: PM stds only in 2009
• 25– 75 hp: PM AT stds and EGR or equivalent NOX technology
in 2013; no NOX AT
• >75 hp: PM AT stds phasing in beginning in 2009; NOX AT
phasing in beginning in 2011
1a ......... • 15 ppm in 2008 for NR, loco/marine ........................................... • PM AT introduced in 2009– 10
• NOX AT introduced in 2011– 12
1b ......... • 15 ppm in 2006 for NR, loco/marine ........................................... Same as 1a
2-Step Fuel Options
2a ......... Same as proposed program except— ............................................ Same as proposed program

• 500 ppm in 2006 for NR, loco/marine.
2b ......... Same as proposed program except— ............................................ Same as proposed program except—
• 15 ppm in 2009 for NR and loco/marine ..................................... • Move PM AT up 1 year for all engines >25 hp (phase in starts
2010)
2c ......... Same as proposed program except— ............................................ Same as proposed program except—
• 15 ppm in 2009 for NR and loco/marine ..................................... • Move PM AT up 1 year for all engines 175– 750 hp (phase in
starts 2010)
2d ......... • Same as proposed program ........................................................ Same as proposed program except—
TABLE VII– 1.— SUMMARY OF ALTERNATIVE PROGRAM OPTIONS— Continued

Option Fuel Standards Engine Standards a
• Phase-in NOX AT for 25– 75hp beginning in 2013
Other Options
3 ........... • Same as proposed program ........................................................ Same as proposed program except—

• Mining equipment over 750 hp left at Tier 2
4 ........... Same as proposed program except— ............................................ Same as proposed program
• Downgrade flexibilities for loco/marine not included.
5a ......... • Same as proposed program ........................................................ Same as proposed program except—
• No Tier 4 standards <75 hp
5b ......... • Same as proposed program ........................................................ Same as proposed program except—
• No new <75hp standards after 2008 (i.e., no CDPFs in 2013)
Notes: a AT = aftertreatment.
B. Introduction of 15 ppm Nonroad standards and nonroad engine retrofits C. Applying the 15 ppm Sulfur Cap to
Diesel Sulfur Fuel in One Step can also be introduced earlier. Locomotive and Marine Diesel Fuel
EPA carefully evaluated an alternative The reasons provided in the NPRM In the NPRM, we requested comment
which would require that the nonroad for choosing the two step program over on extending the 15 ppm cap to
diesel sulfur level be reduced to 15ppm the one-step program still apply and locomotive and marine diesel fuel in
in a single step, beginning June 1, 2008. generally address the comments 2010 or some later year as part of this
The one-step fuel options, including the received (see section 12.6.2 of the draft rule. The costs and inventory impacts of
three variations Option 1, Option 1a, RIA). Although there would be greater this alternative were explored in the
and Option 1b, were presented and PM and NOX emission reductions with context of Option 4 in the NPRM. A
discussed in detail in the NPRM and in the one-step approach due to earlier 15ppm sulfur cap for locomotive and
the draft RIA. introduction of aftertreatment marine fuel would increase the long-
Many comments were received about technology enabled by the 15 ppm term PM and SO2 benefits of the rule
a one step diesel fuel sulfur control sulfur diesel fuel, the SO2 emission and would reduce the number of fuels
approach taking effect in 2008. Refiners benefits for the two-step approach are being carried in the distribution system
commented that they did not think that greater due to the earlier adoption of the after 2014, when the small refiner
they could reduce both the highway and 500 ppm sulfur standard. Thus, even provisions of this rule expire. It would
nonroad diesel fuel pools down to 15 assuming that the one-step approach also allow refiners to plan to comply
ppm in the same timeframe while would not jeopardize implementation of with the 15 ppm cap for locomotive and
maintaining the supply of these two the highway diesel emission rule, the marine diesel fuel at the same time as
diesel fuel pools. The refiners went on emission impacts of these two options they plan to comply with the 500 ppm
to say that having a 500 ppm outlet for are mixed. Moreover, the costs for cap for NRLM fuel and the 15 ppm cap
off-specification material in the nonroad achieving the second step (15 ppm) of for nonroad fuel.
diesel fuel pool is critical in the years the two step approach are likely to be As a result of comments received and
after reducing the highway diesel fuel lower than under the one step approach. additional analyses performed since the
pool to 15 ppm to ensure supply of This is because advanced NPRM, we are finalizing a 15 ppm
highway fuel. The refining industry desulfurization technologies are much sulfur cap for locomotive and marine
further commented that the one step more likely to be used in 2010 after fuel in today’s notice. A full discussion
program would provide fewer additional testing and demonstration, of the feasibility and benefits of a 15
environmental benefits and also provide while they may hardly be considered at ppm sulfur cap for locomotive and
the refining industry less time and all if they would have to be installed for marine fuel can be found in section IV,
flexibility to make the transition to the 2008. One advanced desulfurization along with a summary of the comments
15 ppm sulfur level for nonroad diesel we received and our responses to those
technology, Process Dynamics
fuel compared to a two step approach. comments. In addition, we are planning
Isotherming, is expected to lower the
While many environmental a separate rule to implement new
cost of complying with the 15 ppm step
organizations and the Engine emission standards for locomotive and
by about one cent per gallon. This cost
Manufacturers Association (EMA) marine diesel engines that will build
discrepancy is expected to persist since
commented that they preferred a 15 upon the 15 ppm sulfur standard
ppm standard as soon as possible, EMA it is associated with the investment of
applicable to fuel used by these engines.
also pointed out that a quick transition significant capital which cannot be
We are publishing an Advanced Notice
to 500 ppm would provide important modified or replaced without significant
of Proposed Rulemaking in another
fleet-wide emission reductions, reduce additional expense. Additionally, under
section of today’s Federal Register
maintenance costs and enable the use of the two step program, refiners will be describing our plans in this area.
certain emission control technology able to use their experience in
such as exhaust gas recirculation and complying with 15 ppm highway diesel D. Other Alternatives
oxidation catalysts. Commenters fuel sulfur standard to better design We also analyzed a number of other
generally said little about the engine their nonroad hydrotreaters needed for alternatives in the NPRM, as
standards associated with the one-step 2010. summarized in table VII–1. Some of
options, other than to point out that After careful consideration of these these focused on control options more
earlier introduction of 15 ppm sulfur matters, we have decided to finalize the stringent than our final program while
fuel means that aftertreatment-based two-step approach in today’s action. others reflect modified engine
requirements that result in less stringent 0.02 g/hp-hr PM standard for 50–75 hp responsibility for the review. We have
control. In the NPRM we presented our engines in 2012. We assume that not yet worked out process details for
assessment of these options in terms of manufacturers would only choose this the review, but will do so at some later
the feasibility, emission reductions, option if they had confidence that they date.
costs, and other relevant factors. Few could meet the 0.02 g/hp-hr standard in Several commenters strongly stressed
comments were received on these other 2012, a year earlier than otherwise the need for EPA to work with
alternatives, and no new information required. governmental standards-setting bodies
arose to alter what we believe are Numerous commenters expressed in other countries to harmonize future
significant concerns with respect to support for the planned technology standards. As discussed in section
these Options compared to the final review. MECA and STAPPA/ALAPCO II.A.8, we recognize the importance of
program. Hence, with the exception of stressed that the review should not be harmonizing nonroad diesel standards
the few alternative program elements limited to considering the need to relax and have worked diligently with our
that we did incorporate into our final PM filter-based standards for small colleagues responsible for setting such
program as described earlier in this engines, but should also consider standards outside the U.S., thus far with
section, we did not include these technology innovations that would good success. The March 2004 Directive
options into our final program. Our justify increasing the stringency of small that sets future nonroad diesel standards
detailed responses to all the comments engine standards that are not currently in the European Union (EU) will very
received on the other alternatives can be aftertreatment-based. This is indeed our closely align the EU program with our
found in section 8 of the Summary and intent. Yanmar suggested that the program in the Tier 4 timeframe. 251
Analysis of Comments document. review be deferred to 2010 or later, Further enhancing prospects for close
because NOX control experience from harmonization, the Directive includes
VIII. Future Plans
highway diesels will not be sufficient by plans for a future technical review:
The above discussion describes the ‘‘There are still some uncertainties
contents of this final rule. This section 2007. On the contrary, based on the rate
of technology development progress to regarding the cost effectiveness of using
addresses a variety of areas not after-treatment equipment to reduce
addressed by this rule. In these several date for highway engines, we believe
that there will be a very large amount emissions of particulate matter (PM) and
areas, we expect to continue our efforts of oxides of nitrogen (NOX). A technical
to improve our compliance programs of pertinent new information available
by 2007, even though widespread field review should be carried out before 31
and achieve further reductions in December 2007 and, where appropriate,
emissions from nonroad engines. experience may be lacking. Waiting
longer to conduct the technology review exemptions or delayed entry into force
A. Technology Review would, we believe, provide insufficient dates should be considered.’’
Note that the timing for this review
As we described in sections III.E and leadtime to the industry should an
coincides with that of our own planned
G of the proposal, there are some adjustment to the 2013 standards be
review. Among other things, both our
technology issues that warrant our found appropriate. Some engine and
review and the EU review will consider
planning a future review of emissions equipment manufacturers called for
the appropriate long-term standards for
control technology for engines under 75 expanding the technology review to
engines between 25 and 50 hp, engines
hp. Under our implementation schedule other power categories. As discussed in
for which we have set PM-filter based
presented in section II.A, standards the proposal, we do not believe that a
standards and for which the EU has not.
based on the use of PM filter technology generalized technology review of the
Furthermore, in addition to re-
will take effect in the 2013 model year sort being conducted for the heavy-duty
evaluating the standards, the EU
for 25–75 hp engines (or in the 2012 highway engine program is warranted,
technical review will consider the need
model year for manufacturers opting to primarily due to the very fact that the
to introduce standards for engines
skip the transitional standards for 50–75 nonroad standards are modeled on the
below 25 hp and above 750 hp, the two
hp engines). However, at this time we highway program, and the highway
categories for which the EU has not yet
have not decided what long-term PM program does include this
set emission standards, and for which
standards for engines under 25 hp are comprehensive review. We also do not
harmonization is thus most lacking. We
appropriate. No PM filter-based see the specific technical issues for
are greatly encouraged by the degree of
standards are being adopted for these engines above 75 hp that have been
harmonization achieved thus far, and,
under 25 hp engines in this final rule. identified for smaller engines, such as
given our common interests, issues and
Likewise, we have not decided what the might warrant our expanding the review
planned timing, expect to work closely
long-term NOX standards for engines at this time. Engine manufacturers also
with Commission staff in carrying out
under 75 hp should be, and no NOX expressed interest in a consultative
the 2007 technology review, with an
adsorber-based standards are being set process in the near future that would
aim of preserving and enhancing
for these engines in this final rule. As establish the scope, outputs, and criteria
harmonization of standards.
part of the technology review, we plan for the review, possibly including
In response to comments received on
to thoroughly evaluate progress made assigning responsibility for the review
the proposal, we wish to clarify that the
toward applying advanced PM and NOX to an independent entity. Although we
technology review for engines under 75
control technologies to these smaller plan and hope to have the active
hp will be a comprehensive undertaking
engines. participation of all interested parties in
that may result in adjustments to
We plan to conduct the technology the review process, assigning
standards, implementation dates, or
review in 2007, and to conclude it by responsibility for the review to groups
other provisions (such as flexibilities) in
the end of that year, to give or individuals outside the Agency
either direction (that is, toward more or
manufacturers lead time should an would be inappropriate. As the review
less stringency), depending on
adjustment in the program be would be closely tied to potential
conclusions reached in the review about
considered appropriate. We do not subsequent rulemaking action by the
intend to include in the technology Agency, it is essential that it adequately 251 Council of the European Union, ≥Directive of
review a reassessment of PM filter cover the relevant issues. To ensure this, the European Parliament and of the Council
technology needed to meet the optional it is imperative that we retain overall amending Directive 97/68/EC,≥ March 15, 2004.
appropriate standards under the Clean adapt the requirements as needed to We are concurrently publishing an
Air Act. All relevant factors including appropriately address diagnostic needs Advance Notice of Proposed
technical feasibility and commercial for nonroad diesel engines. These Rulemaking that describes the emission-
viability of engines and machines programs would likely be very similar, control program we are contemplating
designed to meet the standards will be but the diagnostics for nonroad engines for these engines. After consideration of
taken into account. my need to differ in some ways, comments submitted on the Advance
depending on the technologies used by Notice, we will publish a Notice of
B. Test Procedure Issues
different types and sizes of engines and Proposed Rulemaking. Our proposal
Section III describes two issues on an assessment of an appropriate level will be subject to comment before its
related to test procedures that warrant of information and control for engines expected completion in the 2006 time
further attention in the future. First, we used in nonroad applications. frame.
are adopting transient test procedures The engine emission control program
for engines subject to Tier 4 emission E. Future NOX Standards for Engines in to be described in the Advance Notice
standards, but we intend to collect data Mobile Machinery Over 750 hp will cover all locomotive engines
that would help us adopt a duty cycle In section II.A.4, we explain that we subject to 40 CFR part 92 and all marine
that would appropriately test constant- are not, at this time, setting Tier 4 NOX diesel engines with displacement below
speed engines. Second, we are adopting standards for mobile machinery over 30 liters per cylinder. Note that the rule
cold-start test procedures, but are 750 hp based on the performance of will therefore cover marine diesel
interested in collecting additional data high-efficiency aftertreatment, although engines below 37 kW, which are
that could be used to revise those we note that the 2.6 g/bhp-hr NOX currently regulated through Tier 3 with
procedures if appropriate. standard taking effect for these engines land-based nonroad engines in 40 CFR
C. In-Use Testing in 2011 represents a more than 60% part 89. The rule will also address both
NOX reduction from the 6.9 g/bhp-hr recreational and commercial marine
Although this final rule does not diesel engines with displacement below
include an in-use testing program for Tier 1 level in effect today, and a more
than 40% reduction from the 4.8 g/bhp- 30 liters per cylinder. Marine engines at
nonroad diesel engines, we expect to or above 30 liters per cylinder typically
establish such a program for the future hr NOX+NMHC Tier 2 standard level
that takes effect in 2006. We are still use a different kind of fuel, residual
in a separate rulemaking action. The fuel, and will be considered in a
goal of this program will be to ensure evaluating the issues involved for these
separate rulemaking to be finalized by
that emissions standards are met engines to achieve a more stringent NOX
April 27, 2007, pursuant to a regulatory
throughout the useful life of the engines, standard, and believe that these issues
provision adopted in our recent rule
under conditions normally experienced are resolvable. We intend to continue
setting standards for those engines (68
in-use. The Agency expects to pattern evaluating the appropriate long-term
FR 9783, February 28, 2003).
the in-use testing requirements for NOX standard for mobile machinery
nonroad diesel engines after a program over 750 hp and expect to announce G. Retrofit Programs
that is being developed for heavy-duty further plans regarding these issues, In the proposal, we requested
diesel highway vehicles. This program perhaps as early as 2007. comment on setting voluntary new
will be funded and conducted by the F. Emission Standards for Locomotive engine emission standards applicable to
manufacturer’s of heavy-duty diesel and Marine Diesel Engines the retrofit of nonroad diesel engines.
highway engines with our oversight. We As described in section III.A, we are not
expect it will incorporate a two-year This final rule adopts limited adopting a retrofit credit program with
pilot program. The pilot program will requirements to limit sulfur levels in today’s action. We believe it is
allow the Agency and manufacturers to distillate fuels used in locomotive and important to more fully consider the
gain the necessary experience with the many marine diesel engines, which will details of a retrofit credit program and
in-use testing protocols and generation help reduce PM emissions from these work with interested parties in
of in-use test data using portable engines. In an upcoming rulemaking, we determining whether a viable program
emission measurement devices prior to will consider an additional tier of NOX can be developed. EPA intends to
fully implementing program. A similar and PM standards for marine diesel explore the possibility of a voluntary
pilot program is expected to be part of engines less than 30 liters per cylinder nonroad retrofit credit program through
any manufacturer-run, in-use NTE test and for locomotive engines. These future action.
program for nonroad engines. standards would reflect the application
of advanced emission-control H. Reassess the Marker Specified for
The Agency plans to promulgate the
technology, including the potential to Heating Oil
in-use testing requirements for heavy-
duty highway vehicles in the December use the high-efficiency catalytic As discussed in sections IV and V, we
2004 time frame. We anticipate emission-control devices like those are requiring that the chemical marker
proposing a manufacturer-run, in-use described elsewhere in this preamble. In solvent yellow 124 (SY–124) be added
testing program for nonroad diesel developing these new standards, we to heating oil outside of the Northeast/
engines by 2005 or earlier. As will consider the substantial overlap in Mid-Atlantic Area. We received
mentioned above, the nonroad diesel engine technology between the comments from the American Society of
engine program is expected to be locomotive and marine engines and the Testing and Materials (ASTM), the
patterned after the heavy-duty highway nonroad engines covered by this final Coordinating Research Council (CRC),
program. rule. We will also take into account the the Department of Defense (DoD), and
unique features associated with the Federal Aviation Administration
D. Engine Diagnostics locomotive and marine engines (and (FAA) requesting that we delay
We are also in the process of defining their respective markets) and the extent finalizing the selection of a specific
diagnostic requirements that would to which these differences may marker for use in this final rule due to
apply to highway diesel engines. Once constrain the feasibility of applying concerns for jet fuel contamination.
we have adopted requirements for advanced emission control technologies ASTM withdrew its request for a
highway engines, we would aim to to those engines. postponement in the regulation, given
that this final rule requires addition of rulemaking process, EPA met with President’s priorities, or the principles
the marker at the terminal, rather than stakeholders including representatives set forth in the Executive Order.
the refinery gate as proposed. This from the fuel refining and distribution A final Regulatory Impact Analysis
eliminates most of the concern industry, engine and equipment has been prepared and is available in
regarding jet fuel contamination. manufacturing industries, emission the docket for this rulemaking and at the
However, ASTM stated that some control manufacturing industry, internet address listed under ‘‘How Can
concern remains regarding jet fuel environmental organizations, states, I Get Copies of This Document and
contamination downstream of the agricultural interests, and others. Other Related Information?’’ above. This
terminal. Nevertheless, ASTM related A detailed Response to Comments action was submitted to the Office of
that these concerns need not delay document was prepared for this Management and Budget for review
finalization of the marker requirements rulemaking that describes the comments under Executive Order 12866. Estimated
in this rule, since a CRC program to that we received on the proposal along annual costs of this rulemaking are
evaluate these concerns is expected to with our response to each of these estimated to be $2 billion per year, thus
be completed well before SY–124 must comments. The Response to Comments this proposed rule is considered
be added to heating oil. FAA is also document is available in the air docket economically significant. Written
undertaking an effort to identify fuel and e-docket for this rule, as well as on comments from OMB and responses
markers that would be compatible for the Office of Transportation and Air from EPA to OMB comments are in the
use in jet fuel. Quality homepage. In addition, public docket for this rulemaking.
We also received comments from the comments and responses for many key B. Paperwork Reduction Act
heating oil industry and the Department issues are included throughout this
of Defense, which expressed concerns preamble. The information collection
regarding the potential health effects requirements in this rule have been
and maintenance impacts on heating oil X. Statutory and Executive Order submitted for approval to the Office of
equipment from the use of SY–124 in Reviews Management and Budget (OMB) under
heating oil. As discussed in section V, A. Executive Order 12866: Regulatory the Paperwork Reduction Act, 44 U.S.C.
we believe these concerns have been Planning and Review 3501 et seq. The information collection
adequately addressed for us to specify requirements are not enforceable until
the use of SY–124 in this final rule. The Under Executive Order 12866 (58 FR OMB approves them. The OMB control
EU has required the use of SY–124 in 51735, October 4, 1993), the Agency number for engine-related information
heating oil since August 2002. The EU must determine whether the regulatory collection is 2060–0460 (EPA ICR
intends to re-evaluate the use of SY–124 action is ‘‘significant’’ and therefore number 1897.07) and for fuel-related
after December 2005 or earlier if they subject to review by the Office of information collection is 2060–0308
learn of any health, safety, or Management and Budget (OMB) and the (EPA ICR number 1718.07).
environmental concerns from their in- requirements of this Executive Order. We will use the engine-related
use experience with SY–124. The Executive Order defines a information to ensure that new nonroad
We will keep abreast of the ASTM, ‘‘significant regulatory action’’ as any diesel engines comply with emission
CRC, FAA, IRS, and EU activities and regulatory action that is likely to result standards through certification
commit to a review of our use of SY– in a rule that may— requirements and various subsequent
124 under today’s rule based on these • Have an annual effect on the compliance provisions. This
findings. If alternative markers are economy of $100 million or more or information collection is mandatory
identified that do not raise concerns adversely affect in a material way the under the provisions of 42 U.S.C. 7401–
regarding the potential contamination of economy, a sector of the economy, 7671(q). We will use the fuel-related
jet fuel, we will initiate a rulemaking to productivity, competition, jobs, the information to ensure that diesel fuel
evaluate the use of one of these markers environment, public health or safety, or meets the sulfur limits and
in place of SY–124. State, Local, or Tribal governments or corresponding requirements related to
communities; marking and segregating the different
IX. Public Participation • Create a serious inconsistency or types and grades of diesel fuel. This
Many interested parties provided otherwise interfere with an action taken information collection is mandatory
their input on the proposed rulemaking or planned by another agency; under the provisions of 42 U.S.C.
during our public comment period. This • Materially alter the budgetary 7545(c), (g) and (i), and 7625–1.
comment period, along with the three impact of entitlements, grants, user fees, In addition, this notice announces
public hearings that were held in New or loan programs, or the rights and OMB’s approval of the information
York, Chicago, and Los Angeles, obligations of recipients thereof; or collection requirements for other
provided ample opportunity for public • Raise novel legal or policy issues programs, as summarized in Table X.B–
participation. Throughout the arising out of legal mandates, the 1.
TABLE X.B– 1— APPROVED INFORMATION COLLECTION REQUESTS FROM OTHER PROGRAMS

OMB control EPA ICR num-
Program Final rule cite OMB approval
number ber
Nonroad spark-ignition engines over 19 kW .............. November 8, 2002 (67 FR 2060– 0460 1897.04 January 31, 2003.
68242).
Recreational vehicles .................................................. November 8, 2002 (67 FR 2060– 0460 1897.04 January 31, 2003.
68242).
Rebuilders of various types of engines ...................... November 8, 2002 (67 FR 2060– 0104 0783.46 June 11, 2003.
68242).
Highway motorcycles .................................................. January 15, 2004 (69 FR 2060– 0104 0783.46 March 26, 2004.
2398).
The estimated annual public reporting agency. This includes the time needed existing ways to comply with any
and recordkeeping burden for collecting to review instructions; develop, acquire, previously applicable instructions and
information from all these programs is install, and utilize technology and requirements; train personnel to be able
shown in Table X.B–2. Burden means systems for the purposes of collecting, to respond to a collection of
the total time, effort, or financial validating, and verifying information, information; search data sources;
resources expended by persons to processing and maintaining complete and review the collection of
generate, maintain, retain, or disclose or information, and disclosing and information; and transmit or otherwise
provide information to or for a Federal providing information; adjust the disclose the information.
TABLE X.B– 2.— INFORMATION COLLECTION BURDENS

Operating and
Capital costs Total costs for
Hours per re- Hours for all maintenance
Engine type Respondents for all re- all respond-
spondent respondents costs for all re-
spondents ents
spondents
Nonroad diesel engine manufacturers ..... 75 3,304 247,783 $0 $5,894,802 $18,661,614

Diesel fuel suppliers ................................. 2,615 75 196,288 1,800,000 1,800,000 18,371,600
Nonroad spark-ignition engine manufac-
turers .................................................... 12 1,832 21,986 174,419 2,507,790 3,617,683
Recreational vehicle manufacturers ........ 39 684 26,669 1,627,907 2,137,115 4,869,253
Highway motorcycles ............................... 46 32 1,449 0 23,686 79,428
Importers .................................................. 40 13 529 0 150,000 169,223
Rebuilders ................................................ 200 6 1,200 0 0 38,800
An agency may not conduct or Susan Auby, Collection Strategies C. Regulatory Flexibility Act (RFA), as
sponsor, and a person is not required to Division, U.S. Environmental Protection Amended by the Small Business
respond to a collection of information Agency (2822–T), 1200 Pennsylvania Regulatory Enforcement Fairness Act of
unless it displays a currently valid OMB Ave., NW., Washington, DC 20460 or by 1996 (SBREFA), 5 U.S.C. 601 et seq.
control number. The OMB control e-mail at auby.susan@epa.gov. EPA has decided to prepare a
numbers for EPA’s regulations in 40 To comment on the Agency’s need for Regulatory Flexibility Analysis (RFA) in
CFR are listed in 40 CFR part 9. When this information, the accuracy of the connection with this final rule. For
this ICR is approved by OMB, the provided burden estimates, and any purposes of assessing the impacts of
Agency will publish a technical suggested methods for minimizing today’s rule on small entities, a small
amendment to 40 CFR part 9 in the entity is defined as: (1) A small business
respondent burden, including the use of
Federal Register to display the OMB that is primarily engaged in the
automated collection techniques, EPA
control number for the approved manufacturing of nonroad diesel
has a public docket for this rule, which
information collection requirements engines and equipment that meets the
includes this ICR, under Docket ID
contained in this final rule. EPA definitions based on the Small Business
number OAR–2003–0012. Submit any
received various comments on the Administration’s (SBA) size standards
comments related to the ICR for this rule
rulemaking provisions covered by the (see table X.C.–1 below); (2) a small
ICRs, but no comments on the to EPA and OMB. Address comments to
governmental jurisdiction that is a
paperwork burden or other information OMB by e-mail to
government of a city, county, town,
in the ICRs. All comments that were drostker@omb.eop.gov or fax to (202) school district, or special district with a
submitted to EPA are considered in the 395–7285. Please do not send comments population of less than 50,000; and (3)
relevant Summary and Analysis of to OMB via U.S. Mail. a small organization that is any not-for-
Comments, which can be found in the profit enterprise which is independently
docket. A copy of any of the submitted owned and operated and is not
ICR documents may be obtained from dominant in its field.
TABLE X.C– 1.— SMALL BUSINESS ADMINISTRATION SIZE STANDARDS FOR VARIOUS BUSINESS CATEGORIES
Major SIC a
Industry Defined as small entity by SBA if: Codes
Engine manufacturers .............................................................. Less than 1,000 employees .................................................... Major Group 35.
Equipment manufacturers:
— Construction equipment ................................................. Less than 750 employees ....................................................... Major Group 35.
— Industrial truck manufacturers (i.e. forklifts) .................. Less than 750 employees ....................................................... Major Group 35.
— All other nonroad equipment manufacturers ................. Less than 500 employees ....................................................... Major Group 35.
Fuel refiners .............................................................................. Less than 1500 employees b ................................................... 2911.
Fuel distributors ........................................................................ <varies> ................................................................................... <varies>
Notes:
a Standard Industrial Classification.
b EPA has included in past fuels rulemakings a provision that, in order to qualify for the small refiner flexibilities, a refiner must also have a
company-wide crude refining capacity of no greater than 155,000 barrels per calendar day. EPA has included this criterion in the small refiner
definition for a nonroad diesel sulfur program as well.
Pursuant to 5 U.S.C. 603, EPA 2. Summary of Significant Public hp range not be based on performance
prepared an Initial Regulatory Comments on the IRFA of aftertreatment technologies.
Flexibility Analysis (IRFA) for the We received comments from engine Advocacy believed that the proposed
proposed rule and convened a Small and equipment manufacturers, fuel flexibilities will not suffice on their own
Business Advocacy Review Panel refiners, fuel distributors and marketers, to appropriately minimize the
(SBAR Panel, or ‘‘the Panel’’) to obtain and consumers during the public regulatory burdens on small entities;
advice and recommendations of comment period following the proposal and Advocacy noted that during the
representatives of the regulated small of this rulemaking. All of the following SBREFA process some small equipment
entities pursuant to 5 U.S.C. 609(b) (see comments were taken into account in manufacturers stated that although EPA
68 FR 28518–28521, May 23, 2003). A developing today’s final rule. Responses would allow some equipment to be sold
detailed discussion of the Panel’s advice to these comments are located in which would not require new emissions
and recommendations can be found in subsection 5 below, along with the controls, engine manufacturers would
the Panel Report (Docket A–2001–28, description of the provisions that we are not produce or sell such equipment.
Document No. II–A–172). See also finalizing to reduce the rule’s impact on Advocacy also commented that we have
section III.C above. small businesses. More detailed not shown that substantial numbers of
We have also prepared a Regulatory information in response to these small businesses have taken advantage
Flexibility Analysis for today’s rule. The comments can be found in sections III.C. of previous small business flexibilities,
Regulatory Flexibility Analysis (Engine and Equipment Small Business or that small businesses would be able
addresses the issues raised in public Provisions) and IV.B (Hardship Relief to take advantage of the flexibilities
comments on the IRFA, which was part Provisions for Qualifying Refiners) of under this rule. Lastly, Advocacy
of the proposal of this rule. The this preamble. Additional detail may commented that although full
Regulatory Flexibility Analysis is also be found in the Final Regulatory compliance with the more stringent
available for review in the docket and is Flexibility Analysis, located in the emissions controls requirements would
summarized below. The key elements of Regulatory Impact Analysis, as well as be delayed for small manufacturers,
a regulatory flexibility analysis in the Summary and Analysis of small business manufacturers
include— Comments for this final rule. eventually will be required to produce
equipment meeting the new
—The need for, and objectives of, the a. Public Comments Received on Engine requirements.
rule; and Equipment Standards
—The significant issues raised by public b. Public Comments Received on Fuel
One small engine manufacturer Standards
comments, a summary of the Agency’s
commented that the proposed
assessment of those issues, and a i. General Comments on Small Refiner
provisions for small business engine
statement of any changes made to the Flexibility
manufacturers are appropriate and
proposed rule as a result of those
strongly supported their inclusion in the One small refiner commented that it
comments;
final rule. The manufacturer raised is not feasible at this time to evaluate
—The types and number of small many concerns of why it believes that the impact of the three fuels regulations
entities to which the rule will apply; it is necessary to include provisions, on the refining industry (and small
—The reporting, recordkeeping and such as: Larger/higher-volume refiners), however it stated that we
other compliance requirements of the manufacturers will have priority in should continue to evaluate the impacts
rule; and supply of new technologies and will and act quickly to avoid shortages and
—The steps taken to minimize the have more R&D time to complete price spikes and we should be prepared,
impact of the rule on small entities, development of these systems before if necessary, to act quickly in
consistent with the stated objectives they are available to smaller considering changes in the regulations
of the applicable statute. manufacturers; smaller manufacturers to avoid these problems. We also
1. Need for and Objectives of the Rule do not command the same amount of received comment that some small
attention from potential suppliers of refiners that produce locomotive and
Controlling emissions from nonroad critical technologies for Tier 4 controls, marine fuels fear that future sulfur
engines and equipment, in conjunction and are thus concerned that they may reductions to these markets could be
with controls on sulfur concentrations not be able to attract a manufacturer to very damaging.
in diesel fuel, has very significant work with them on the development of
public health and welfare benefits, as compliant technologies. This small ii. Comments on the Small Refiner
explained in section I of this preamble. manufacturer believes that the Definition
We are finalizing new engine standards additional three-year time period A small refiner commented that the
and related provisions under sections proposed for small engine proposed redefinition of a small refiner
213(a)(3) and (4) of the Clean Air Act manufacturers in the NPRM is necessary (to not grandfather as small refiners
which, among other things, direct us to for the company, and is their estimate those that were small for highway
establish (and from time to time revise) of the time that it will take for these diesel) would both negate the benefits
emission standards for new nonroad technologies to be available to small afforded under the small refiner
diesel engines. Similarly, section engine manufacturers. provisions in the Highway Diesel Sulfur
211(c)(1) authorizes EPA to regulate The Small Business Administration’s rule and disqualify its status as a small
fuels if any emission product of the fuel Office of Advocacy (‘‘Advocacy’’) raised refiner. The small refiner is, however, in
causes or contributes to air pollution the concern that the rule would impose support of the addition of the capacity
that may endanger public health or significant burdens on a substantial limit in the small refiner definition
welfare, or that may impair the number of small entities producing which will correct the problem of the
performance of emission control engines of 75 hp or less, with little inadvertent loop-hole in the two
technology on engines and vehicles. We corresponding environmental benefit. previous fuel rules. Though the refiner
are finalizing new fuel standards today Advocacy therefore recommended that is concerned that the wording of the
for both of these reasons. PM standards for engines in the 25–75 proposed language may result in small
refiners such as itself, who grew by believes that it is important that a small concentrated in these states, namely
normal business practice, being refiner be able to use Options 1, 2, and Washington and Oregon—states which
disqualified as small refiners. The 3 in combination with each other, and are served primarily by refineries that
refiner suggested that we clarify the stated that we need to clarify the intent will be allowed to delay compliance
language and include provisions for in the final rule. The small refiner also with the ULSD standards until 2014.
continuance of small refiner flexibility commented that the provisions in 40 Therefore, the group commented,
for refiners who qualified under the CFR 80.553 and 80.554 are not clear and residents of these areas are denied air
Highway Diesel Sulfur rule (and have should be revised to clarify their intent. quality benefits equivalent to those
not been disqualified as the result of a Specifically, the refiner questioned promised the rest of the country. Those
merger or acquisition). whether or not a small refiner who seeking to purchase and use equipment
committed to producing ULSD by June in these areas will be subject to the
iii. Comments on the Baseline Approach
1, 2006 in exchange for an extension of ULSD standard regardless of fuel supply
A coalition of small refiners provided its interim gasoline sulfur standards and availability in their area, would be
comments on a few aspects of concern. (under 40 CFR 80.553) could elect to faced with misfueling, deferring
The small refiners believe that the fuel exercise the options allowed under 40 purchase of new equipment, or paying
segregation, and ensuing marking and CFR 80.554. a premium for a ‘‘boutique’’ fuel.
dying, provisions are quite complex. A small refiner raised the concern that
One small refiner believes that the small refiner Option 4 only provides vi. Comments on Inclusion of a Crude
mandating a minimum volume of NRLM an adjustment to those small refiners Capacity Limit for Small Refiners and
production would conflict with the whose small refiner gasoline sulfur Leadtime Afforded for Mergers and
purpose of maintaining adequate on- standards were established through the Acquisitions
highway volumes of 15 ppm sulfur fuel hardship process of 40 CFR 80.240. The A non-small refiner supported the
and unnecessarily restricts small small refiner suggested that we finalize inclusion of the 155,000 bpcd limit, but
refiners, and offered suggestions in their a compliance option that allows a 20 suggested that we limit the provision of
comments on how to improve the percent increase in small refiner affording a two-year leadtime to small
language. In addition, the small refiner gasoline sulfur standards be extended to refiners who lose their small status due
believes that mandating a minimum all small refiners, not just those with to merger or acquisition to the case
volume of NRLM production would standards established pursuant to 40 where a small refiner merges with
conflict with the purpose of maintaining CFR 80.240(a), and offers suggested another small refiner. Further, the
adequate on-highway volumes of 15 language in its comments. refiner commented that it would be
ppm sulfur fuel and unnecessarily inappropriate to allow such small
restricts small refiners, and offered v. Comments on Emission Impacts of refiners to be able to generate credits for
suggestions in their comments on how the Small Refiner Provisions ‘‘early’’ production of lower sulfur
to improve the language. A state environmental group diesels during this two-year leadtime.
commented that the provisions for small Lastly, the refiner commented that a
iv. Comments on Small Refiner ‘‘Option refiners raise substantial environmental small refiner which acquires a non-
4’’ concerns. The group is concerned that small refiner, and thus loses its small
A coalition of small refiners these provisions will allow small refiner status, should not be eligible for
commented that if the final rule is not refiners the ability to produce gasoline hardship provisions. Another
issued before January 1, 2004, a with an unknown sulfur content for an commenter stated that if we were to
provision should be made to unknown length of time; this fuel may finalize the 155,000 bpcd limit, we
accommodate those small refiners then be sold at the refiner’s retail outlet, should not apply it in cases of a merger
planning to take advantage of the and may become the primary fuel for between two small refiners. The
proposed small refiner ‘‘Option 4’’ (the some vehicles, which alters vehicle fleet commenter further stated that a merger
NRLM/Gasoline Compliance option). A emissions performance. This of two small companies in a hardship
small refiner echoed the concerns of the environmental group also commented condition does not imply improved
small refiner coalition, commenting that that the absence of any process of financial health in the same way that an
delayed finalization of the final rule notification regarding small business acquisition would. Another non-small
would undermine the benefits of small provisions to notify States of these refiner commented that it supports the
refiner flexibility Option 4. The small provisions is troubling. The concern is two-year lead time for refineries that
refiner is concerned that a delay in that these deviations from fuel content lose their status as a small refiner; the
issuing the rule, and subsequent delay that affects fuels consumed in states that refiner believes that any refiner with the
in the opportunity to apply the interim use emissions inventories for air quality financial wherewithal to acquire
gasoline flexibility, would negate its planning purposes, and can additional refineries to allow its crude
opportunity to take full advantage of the significantly alter inventories. The capacity to exceed 155,000 bpcd should
credits the refiner now has, as it would group suggested that in the future there not be able to retain status as a small
not be able to comply with the 300 ppm should be greater communication from refiner.
cap. The small refiner suggested that we us regarding decisions that impact the
allow small refiners to apply for quality of fuels consumed in a state, and vii. Necessity of Small Refiner Program
temporary relief and operate under the thus impact the quality of that state’s A non-small refiner provided
Option 4 provision. Another small air. comment on the NPRM stating the belief
refiner commented that, in the NPRM, it Another state environmental group that the proposed provisions for small
was unclear if a small refiner could elect commented on the flexibility provisions refiners are not practical. The refiner is
to use any or all of the first three of the for small refiners; the group is concerned that having provisions for
small refiner provisions if it did not concerned that the exemption will not small refiners adds a level of
elect to use Option 4. Further, the have a minor effect on the nation’s fuel complication, results in emissions
refiner understood that if Option 4 was supply, as the state is an intermountain losses, increases the potential for ULSD
chosen, a small refiner could not use western state. The group comments that contamination, and create an unfair
any of the first three options. The refiner the impact of this exemption is situation in the marketplace. Similarly,
another non-small refiner and a trade eight percent of the total nonroad engine 4. Reporting, Recordkeeping and Other
group representing many refiners and sales for the year 2000. Compliance Requirements
others in the fuels industry commented This section describes the expected
that they oppose the extension of b. Nonroad Diesel Equipment
Manufacturers burden of the compliance requirements
compliance deadlines for small refiners, (for all manufacturers and refiners) for
as this can result in inequitable We also used the industry profile to the standards being finalized in today’s
situations that may affect the refining determine the number of nonroad small action.
industry for some time and can put the business equipment manufacturers. EPA
distribution system at risk for a. Nonroad Diesel Engine and
identified over 700 manufacturers with Equipment Manufacturers
contamination of lower sulfur fuels.
sales and/or employment data that
They further stated that all refiners will For engine and equipment standards,
could be included in the screening
face challenges in complying with the we must have the assurance that engines
analysis. These businesses included
upcoming standards and would not and/or equipment produced by
manufacturers in the construction,
significantly alter the business decisions manufacturers meet the applicable
that small refiners would make. They agricultural, mining, and outdoor power
equipment (mainly, lawn and garden standard, and will continue to meet this
also stated that non-small refiners face standard as the equipment passes
similar issues with their older and/or equipment) sectors of the nonroad
through to the ultimate end user. We are
smaller refineries, but will not have the diesel market. The equipment produced
continuing many of the reporting,
benefit of being able to postpone making by these manufacturers ranged from recordkeeping, and compliance
these decisions as small refiners will. small walk-behind equipment (sub-25 requirements prescribed for nonroad
hp engines) to large mining and engines and equipment, as set out in 40
viii. Comments on Fuel Marker construction equipment (using engines CFR part 89. These include, certification
in excess of 750 hp). Of the requirements and reporting of
We received comments from terminal
operators stating that the proposed manufacturers with available sales and production, emissions information, use
heating oil marker requirements would employment data (approximately 500 of transition provisions, etc. The types
force small terminal operators to install manufacturers), nonroad small business of professional skills required to prepare
expensive injection equipment and that equipment manufacturers represent 68 reports and records are also similar to
they would not be able to recoup the percent of total nonroad equipment the types of skills that were needed to
costs. manufacturers (and these manufacturers meet the regulatory requirements set out
accounted for 11 percent of nonroad in 40 CFR part 89. Key differences in the
3. Types and Number of Small Entities diesel equipment industry sales in requirements of today’s rule as related
2000). to 40 CFR part 89 are the additional
The small entities directly regulated
testing and defect reporting. We are
by this final rule are nonroad diesel c. Nonroad Diesel Fuel Refiners finalizing an increase in the number of
engine and equipment manufacturers, data points (i.e., transient testing) that
nonroad diesel fuel refiners, and Our current assessment is that 26
refiners (collectively owning 33 will be required for reporting emissions
nonroad diesel fuel distributors and information. Also, as proposed, we are
marketers. These categories are refineries) meet SBA’s definition of a
requiring additional defect reporting for
described in more detail below, and the small business for the refining industry.
Tier 4 and later engines. We are
definitions of small entities in those The 33 refineries appear to meet both
requiring that manufacturers report to
categories are listed in table X.C–1 the employee number and production us if they learn that a substantial
above. volume criteria mentioned above. These number of their engines have emission-
small refiners currently produce related defects. This is generally not a
a. Nonroad Diesel Engine Manufacturers
approximately 6 percent of the total requirement to collect information;
Before beginning the SBREFA high-sulfur diesel fuel. It should be however if manufacturers learn that
process, EPA conducted an industry noted that because of the dynamics in there are or might be a substantial
profile for the nonroad diesel sector. We the refining industry (e.g., mergers and number of emission-related defects,
have not received any new information acquisitions), the actual number of then they must send us information
since that time and we continue to refiners that ultimately qualify for small describing the defects.
believe that this is a valid refiner status under the nonroad diesel
b. Nonroad Diesel Fuel Refiners,
characterization of the industry. Using sulfur program could be different than
Distributors, and Marketers
information from the industry profile, this assessment.
EPA identified a total of 61 engine For any fuel control program, we must
manufacturers. The top 10 engine d. Nonroad Diesel Fuel Distributors and have the assurance that fuel produced
manufacturers comprise 80 percent of Marketers by refiners meets the applicable
the total market, while the other 51 standard, and that the fuel continues to
The industry that transports,
companies make up the remaining 20 meet this standard as it passes
distributes, and markets nonroad diesel
percent. 252 Of the 61 manufacturers, downstream through the distribution
fuel encompasses a wide range of
four fit the SBA definition of a small system to the ultimate end user. This is
businesses, including bulk terminals, particularly important in the case of
entity. These four manufacturers were
bulk plants, fuel oil dealers, and diesel diesel fuel, where the aftertreatment
Anadolu Motors, Farymann Diesel
GMBH, Lister-Petter Group, and V & L fuel trucking operations, and totals technologies expected to be used to
Tools (parent company of Wisconsin thousands of entities that have some meet the engine standards are highly
Motors LLC, formerly ‘‘Wis-Con Total role in this activity. Over 90 percent of sensitive to sulfur. Many of the
Power’’). These businesses comprised these entities meet small entity criteria. recordkeeping, reporting and
Common carrier pipeline companies are compliance provisions of the today’s
252 All sales information used for this analysis also a part of the distribution system; 10 action are fairly consistent with those in
was 2000 data. of them are small businesses. place today for other fuel programs,
including the current 15 ppm highway 5. Regulatory Alternatives To Minimize • for NOX 253
diesel regulation. For example, Impact on Small Entities —A three year delay in the program for
recordkeeping involves the use of engines in the 25–50 hp and the 75–
product transfer documents, which are Below we discuss the Panel 175 hp categories, consistent with the
already required under the 15 ppm recommendations, EPA proposals, and one-phase approach recommendation
highway diesel sulfur rule (40 CFR final regulatory alternatives to minimize above;
the rule’s impact on small entities. More
80.560). Under today’s final rule we are • A small engine manufacturer could
adding additional recordkeeping and detailed information on the provisions
be afforded up to two years of hardship
reporting requirements for refiners, for these entities can be found in
(in addition to the transition
importers, and fuel distributors to sections III.C and IV.B of this preamble
flexibilities) upon demonstrating to EPA
implement the designate and track (for small business engine and
a significant hardship situation;
provisions. However, interactions with equipment manufacturers and small • Small engine manufacturers would
parties from all segments of the entities throughout the fuel distribution be able to participate in an averaging,
distribution system indicated that the system, respectively). banking, and trading (ABT) program
records necessary were analogous to a. Panel Recommendations (which we proposed as part of the
records already kept as a normal process overall rulemaking program for all
of doing business. Consequently, the During the SBREFA process, the Panel manufacturers);
only significant additional burden recommended transition flexibilities • Engines under 25 hp would not be
would be associated with the reporting that we considered during the subject to standards based on use of
requirement. development of the NPRM. The Panel advanced aftertreatment; and,
General requirements for reporting for recommended provisions for both the • No NOX aftertreatment-based
refiners and importers include: one-step and two-step options. Since we standards for engines 75 hp and under.
registration (only in the case where a are finalizing a two-step approach, only
refiner or importer is not registered the recommendations for this approach ii. Panel Recommendations for Small
under a previous fuel program), pre- are being discussed here. (A complete Business Equipment Manufacturers
compliance reports (on a refiner or discussion of all of the Panel We proposed the following provisions
importer’s progress towards meeting the recommendations and our proposals for for nonroad diesel small business
nonroad diesel fuel requirements as small entities is located in section X.C. equipment manufacturers:
specified in this rule), quarterly of the NPRM.) • Small business nonroad diesel
designation reports, and annual reports. Following the SBREFA process, the equipment manufacturers must have
All parties from the refiner to the Panel (or some Panel members), reported equipment sales using certified
terminal will be required to report recommended the following transition engines in model year 2002 or earlier to
volumes of designated fuels received flexibilities and hardship provisions to be eligible for all provisions;
and distributed, as well as compliance help mitigate the impacts of the • Essential continuance of the
with quarterly and annual limits. All rulemaking on small entities. We transition flexibilities offered for the
parties in the distribution system are proposed and requested comment on Tier 1 and Tier 2 nonroad diesel
required to keep product transfer these recommendations in the NPRM. emission standards (40 CFR 89.102),
documents (PTDs), though refiners and which are available to all nonroad diesel
importers are required to initially i. Panel Recommendations for Small equipment manufacturers
generate and provide information on Business Engine Manufacturers
—‘Percent-of-production allowance’—
commercial PTDs that identify the over seven model-year period
For nonroad diesel small business
diesel fuel with meeting specific needs manufacturers may install engines not
engine manufacturers, we proposed the
(i.e., 15 ppm highway diesel, 500 ppm certified to the new emission
following provisions:
highway diesel, etc.). Also, refiners in standards in an amount of equipment
Alaska and small refiner/credit fuel • A manufacturer must have certified
in model year 2002 or earlier and would equivalent to 80 percent of one year’s
users must report end users of their fuel. production, implemented by power
These end users must also keep records be limited to 2500 units per year to be
eligible for all provisions set out below; category with the average determined
of these fuel purchases. Lastly, small over the period in which the
refiners are required to apply for small • For PM—
flexibility is used (this proposal
refiner status and small refiner —Small engine manufacturers could would afford additional flexibility
baselines. delay compliance with the standards over the comparable flexibility in Tier
In general, we are requiring that all for up to three years for engines under 2/3, however, because of the smaller
records be kept for at least five years.
25 hp, and those between 75 and 175 number of horsepower categories in
This recordkeeping requirement should
hp (as these engines only have one the Tier 4 rule)
impose little additional burden, as five
standard) —‘Small volume allowance’—a
years is the applicable statute of
—small engine manufacturers have the manufacturer may exceed the 80
limitations for current fuel programs.
See section X.B, above, for a option to delay compliance for one percent allowance in seven years as
discussion of the estimated burden year if interim standards are met for described above, provided that the
hours and costs of the recordkeeping engines between 50 and 75 hp (for previous Tier engine use does not
and reporting that will be required by this power category we are treating exceed 700 total over seven years, and
this final rule. Detailed information on the PM standard as a two phase 200 in any given year, limited to one
the reporting and recordkeeping standard with the stipulation that family per power category;
measures associated with this small manufacturers cannot use PM alternatively, at the manufacturer’s
rulemaking are described in the credits to meet the interim standard; choice by horsepower category, a
Information Collection Requests (ICRs) also, if a small manufacturer elects the
253 There is no change in the NO standard for
for this rulemaking—1897.05 for optional approach to the standard X
engines under 25 hp and those between 50 and 75
nonroad diesel engines, and 1718.05 for (elects to skip the interim standard), hp. For these two power bands EPA proposed no
fuel-related items. no further relief will be provided) special provisions.
program that eliminates the ‘‘single • A small refiner would be afforded For engines in the 50 to 75 hp
family provision’’ restriction with hardship similar to the provisions category:
revised total and annual sales limits established under 40 CFR 80.270 and • PM—A small business engine
as shown below: 80.560 (the gasoline sulfur and highway manufacturer may delay compliance
≤175 hp: 525 previous Tier engines diesel fuel sulfur programs, with the 2013 Tier 4 requirement of 0.02
(over 7 years) with an annual cap of respectively), case-by-case approval of g/bhp-hr PM for up to three years
150 units (separate for each hp hardship applications must be sought provided that it complies with the
category) based on demonstration of extreme interim Tier 4 requirements that begin
>175 hp: 350 previous Tier engines hardship circumstances. in model year 2008 on time, without the
(over 7 years) with an annual cap of We did not propose specific use of credits (as manufacturers of
100 units (separate for each hp provisions for nonroad diesel fuel engines in this category still have the
category); distributors and marketers in the NPRM. option to comply with the Tier 3
• Small business equipment During the SBREFA process, standard). Alternatively, a manufacturer
manufacturers would be allowed to distributors commented that they would may elect to skip the interim standard
borrow from the Tier 3/Tier 4 support a one-step approach to completely. Manufacturers choosing
flexibilities for use in the Tier 2/Tier 3 eliminate the possibility of having this option will receive only one
time frame; and, multiple grades of fuel in the additional year for compliance with the
• Small business equipment distribution system and the Panel 0.02 g/bhp-hr standard (i.e. compliance
manufacturers could be afforded up to recommended that we further study this in 2013, rather than 2012).
two years of hardship after other issue during the development of the • NOX—there is no change in the
transition allowances are exhausted, rule. NOX standard for engines in this
similar to that offered small business category, therefore no special provisions
iv. Additional Panel Recommendations are being provided.
engine manufacturers.
Some, but not all, Panel members For engines in the 75 to 175 hp
In addition, we proposed the Panel’s
recommended that the following category:
recommendation that the provisions for • PM—a manufacturer may elect to
small equipment manufacturers be provisions be included in the NPRM; we
requested comment on these items but delay compliance with the standard for
extended to all equipment up to three years.
manufacturers, regardless of size. We did not propose them:
• The inclusion of a technological • NOX—a manufacturer may elect to
also sought comment on the total delay compliance with the standard for
number of engines and annual cap review of the standards in the 2008 time
frame up to three years.
values proposed and on implementing In regard to the Office of Advocacy’s
the small volume allowance provision • No PM aftertreatment-based
standards for engines between 25 and 75 concern regarding the technical
without a limit on the number of engine feasibility of PM and NOX aftertreatment
families. hp
devices, as proposed in the NPRM, we
iii. Panel Recommendations for Small b. Discussion of Items Being Finalized are not adopting standards based on
Refiners, Distributors, and Marketers in Today’s Action performance of NOX aftertreatment
i. Provisions for Small Business Engine technologies for engines under 75 hp.
The following provisions were We believe the factual record—as
proposed for nonroad diesel small Manufacturers
documented in the RIA, the Summary
refiners: For nonroad diesel small business and Analysis of Comments, and this
• Small refiners would be required to engine manufacturers, we are finalizing preamble—does not support the claim
use 500 ppm sulfur fuel beginning June many of the provisions set out above that the PM standards will not be
1, 2010 and 15 ppm fuel beginning June with some significant revisions, as technically feasible in 2013 for the 25–
1, 2014; described below. We are finalizing all of 75 hp engines. As set out at length in
• Small refiners may choose one of the hardship provisions that we section 4.1.3 of the RIA, among other
the following transition provisions, proposed. We believe these provisions places, performance of PM traps is not
which serve to encourage early are an element of providing appropriate dependent on engine size.
compliance with the diesel fuel sulfur lead time for this class of engines. We disagree with the statement made
standards: For engines under 25 hp: by the Office of Advocacy that, based on
—Credits for Early Desulfurization: • PM—a manufacturer may elect to available information, we do not have a
would allow small refiners to generate delay compliance with the standard for sufficient basis for engines between 25
and sell credits for nonroad diesel up to three years. and 75 hp to be subject to PM standards
fuel that meets the small refiner • NOX—there is no change in the based on use of advanced
standards earlier than required in the existing NOX standard for engines in aftertreatment. As we have documented
regulation; or, this category, so no special provisions earlier and in the RIA, we believe that
—Limited Relief on Small Refiner are being provided. such standards are feasible for these
Interim Gasoline Sulfur Standards: a For engines in the 25 to 50 hp engines at reasonable cost,254 and will
small refiner producing its entire category: help to improve very important air
nonroad diesel fuel pool at 15 ppm • PM—manufacturers must comply quality problems, especially by reducing
sulfur by June 1, 2006, and who with the interim standards (the Tier 4 exposure to diesel PM and by aiding in
chooses not to generate nonroad requirements that begin in model year attainment of the PM 2.5 National
credits for early compliance, would 2008) on time, and may elect to delay
receive a 20 percent relaxation in its compliance with the 2013 Tier 4 254 As the cost issues raised in SBA’s comments
assigned small refiner interim requirements (0.02 g/bhp-hr PM relate to all manufactures (not just small business
gasoline sulfur standards (with the standard) for up to three years. manufacturers), further information on the costs of
this technology as well as the benefits analysis, can
maximum per-gallon sulfur cap for • NOX—a manufacturer may elect to be found in section VI of this preamble (and also
any small refiner remaining at 450 delay compliance with the standard for chapters 6 and 9, respectively, of the Regulatory
ppm); and, up to three years. Impact Analysis).
Ambient Air Quality Standard. See equipment packages, thus saving both 2014.255 This is identical to the relief
generally, comment response 8.2.3 of money and strain on limited proposed in the NPRM (which small
the Summary and Analysis of engineering staffs. Within limits, small refiners considered sufficient and
Comments, and sections 12.6.2.2.9 and business equipment manufacturers supported) with the exception that it
12.6.2.2.10 of chapter 12 of the Draft would be able to continue to use their applies not only to nonroad fuel, but
RIA. These standards will also result in current engine/equipment configuration also to locomotive and marine fuel
significant reductions of NMHC, which and avoid out-of-cycle equipment given the decision to finalize 15 ppm
includes many carcinogenic air toxics. redesign until the allowances are sulfur standards for locomotive and
Indeed, given these facts, we are exhausted or the time limit passes. marine diesel fuel. Table X.C–2 below
skeptical that an alternative of no We are not finalizing the requirement illustrates the delayed standards in
aftertreatment-based PM standards for that small equipment manufacturers and relation to the general program. This
these engines would be appropriate importers have reported equipment delay option is not being finalized for
under section 213(a)(4) of the Clean Air sales using certified engines in model the Northeast and mid-Atlantic areas
Act (see section VII.A above, where we year 2002 or earlier. Please see section due to the removal of the heating oil
found that ‘‘[w]e * * * do not see a III.C.2.a.ii above for a detailed marker in these areas. However this is
basis in law or policy to adopt either of discussion on our decision to eliminate not expected to impact small refiners,
these options’’). We believe that the this requirement from today’s rule. and this will provide significant relief
transition and hardship provisions for small terminal operators. Further,
being finalized for small business We are also finalizing three additional this provision will be finalized in
engine manufacturers in today’s action provisions today. Two of these Alaska only if a refiner gets an approved
are reasonable and are a factor in our provisions are being finalized for all compliance plan for segregating their
ultimate finding that the PM standards equipment manufacturers, and therefore fuel to the end user.
for engines in the 25–75 hp range are small business equipment
We also are finalizing transition
appropriate. manufacturers may also take advantage
provisions to encourage early
of them. These are the Technical
ii. Provisions for Small Business compliance with the standards being
Hardship Provision and the Early Tier 4
Equipment Manufacturers finalized today. These provisions are:
Engine Incentive Program, and are
The transition and hardship discussed in greater detail in sections • The NRLM credit option—Some
provisions that were proposed for small III.B.2.b and e above. The third small refiners have indicated that they
business nonroad equipment provision is being finalized for small might need to produce fuel meeting the
manufacturers are being finalized today, business equipment manufacturers only, NRLM diesel fuel sulfur standards
with some modifications. for the 20–50 hp category. This earlier than required under the small
Adopting an alternative on which we provision is discussed in greater detail refiner program described above
solicited comment, the final rule allows in section III.C.2.b.ii above. (distribution systems might limit the
all equipment manufacturers the number of grades of diesel fuel that will
opportunity to choose between two iii. Provisions for Small Refiners be carried, it may be economically
options: (a) Manufacturers would be advantageous to make compliant NRLM
As previously discussed, we are diesel fuel earlier to prevent losing
allowed to exempt 700 pieces of finalizing standards for locomotive and
equipment over seven years, with one market share, etc.) This option allows
marine diesel fuel today. Below are the small refiners to participate in the
engine family; or (b) manufacturers regulatory transition and hardship
using the small-volume allowance could NRLM diesel fuel sulfur credit banking
provisions that we are finalizing to and trading program discussed in
exempt 525 machines over seven years minimize the degree of hardship
(with a maximum of 150 in any given section IV. Generating and selling
imposed upon small refiners by this credits could provide small refiners
year) for each of the three power program. With these provisions we are
categories below 175 horsepower, and with funds to help defray the costs of
confident about going forward with the early NRLM compliance.
350 machines over seven years (with a 500 ppm sulfur standard for NRLM
maximum of 100 in any given year) for • The NRLM/Gasoline Compliance
diesel fuel in 2007, and the 15 ppm
the two power categories above 175 Option—This option is available to
sulfur standard for nonroad diesel fuel
horsepower. Concurrent with the small refiners that produce greater than
in 2010 and locomotive and marine
revised caps, manufacturers could 95 percent of their NRLM diesel fuel at
diesel fuel in 2012, for the rest of the
exempt engines from more than one the 15 ppm sulfur standard by June 1,
industry. Given the small refiner relief
engine family under the small-volume 2006 and elect not to use the provision
provisions that are being finalized
allowance program. Based on sales described above to earn NRLM diesel
today, small refiners will be the only
information for small businesses, we fuel sulfur credits for this early
refiners permitted to continue selling
estimated that the alternative small- compliance.256 For small refiners
500 ppm fuel to nonroad, locomotive,
volume allowance program to include
and marine markets from 2010 until
lower caps and allow manufacturers to 255 Since new engines with sulfur sensitive
2014 without the use of credits. emission controls will begin to become widespread
exempt more than one engine family
We are finalizing delayed compliance during this time, small refiner fuel will need to be
would keep the total number of engines segregated and only supplied for use in pre–2011
eligible for the allowance at roughly the for small refiners today (‘‘NRLM Delay’’ nonroad equipment or in locomotives or marine
same overall level as the 700-unit option). We are confident with going engines.
program. We believe that these forward with these sulfur standards 256 This is down from the 100 percent
given the regulatory transition requirement proposed to allow for some

provisions will afford small contamination losses in the process of delivering
manufacturers the type of transition provisions being offered for small fuel from the refinery. As discussed earlier in this
leeway recommended by the Panel. refiners. These delayed standards would section, production volumes in the final rule are
Further, these transition provisions allow for the continued production of based upon actual delivered volumes. The 5 percent
higher sulfur NRLM fuel until June 1, allowance for greater than 15 ppm fuel should
could allow small business equipment provide adequate flexibility for any refiner’s
manufacturers to postpone any redesign 2010, and similarly, for the production contamination issues, while not providing any
needed on low sales volume or difficult of 500 ppm NRLM fuel until June 1, Continued
choosing this option the applicable Delay option or the NRLM Credit Further, we are aware of some small
small refiner annual average and per- option, since a small refiner must refiners that plan to take advantage of
gallon cap gasoline sulfur standards will produce at least 85 percent of its NRLM one of the flexibility provisions that
be increased by 20 percent for the diesel fuel at the 15 ppm sulfur standard encourages early compliance with the
duration of the interim program; under the NRLM/Gasoline Compliance standards. Absent specific provisions
however, in no case may the per-gallon option. for small refiners, we would have to
gasoline sulfur cap exceed 450 ppm. Small refiners that choose to make use consider delaying the overall program
A small refiner may choose to use the of the delayed nonroad diesel sulfur until the burden of the program on
relaxed standards (the NRLM Delay requirements would also delay to some
many small refiners was diminished,
option), the NRLM Credit option, or extent the emission reductions that
which would delay the air quality
both in combination. Thus any fuel that would otherwise have been achieved.
it produces from crude at or below the However, the overall impact of these benefits of the overall program. By
sulfur standards earlier than required postponed emission reductions would providing temporary relief to small
will qualify for generating credits. be small in comparison to the overall refiners, we are able to adopt a program
However, the NRLM/Gasoline program benefits, as small refiners that expeditiously reduces NRLM diesel
Compliance option may not be used in represent only a fraction of national fuel sulfur levels in a feasible manner
combination with either the NRLM non-highway diesel production. for the industry as a whole.
TABLE X.C–2.—S ULFUR STANDARDS FOR THE NONROAD DIESEL FUEL SMALL REFINER PROGRAM
(in parts per million (ppm)) a
2006 2007 2008 2009 2010 2011 2012 2013 2014 2015+
Non-Small—NR ................................................ ............ 500 500 500 15 15 15 15 15 15

Non-Small—LM ................................................ ............ 500 500 500 500 500 15 15 15 15
Small—all fuel .................................................. ............ ............ ............ ............ 500 500 500 500 15 15
Notes: a New standards are assumed to take effect June 1 of the applicable year.
iv. Provisions for Small Distributors and companies) of small entities in the costs (for full compliance with the 15
Fuel Marketers engine and equipment manufacturing ppm sulfur standards) for small refiners
Though we did not propose any industry would be affected by between on average would be about 7 cents per
specific regulatory relief for small one and three percent of sales (i.e., the gallon compared to about 5.7 cents per
distributors and marketers of nonroad estimated costs of compliance with the gallon for non-small refiners. (A
fuel, we are finalizing provisions to rule would be greater than one percent, complete discussion of the fuel-related
avoid the negative impact to small but less than three percent, of their costs as a result of this final rule is
terminal operators raised in the public sales). One percent (four companies) of located in Chapter 7 of the Final
comments on our NPRM (that heating small entities would be affected by Regulatory Impact Analysis.) However,
oil marker requirements would force greater than three percent. In all, 17 of we believe that the regulatory transition
small terminal operators to install the 518 potentially affected small engine provisions that we are affording to small
expensive injection equipment and that and equipment manufacturers are entities will significantly minimize this
they would not be able to recoup the estimated to have compliance costs that impact on these entities.
costs). To mitigate the burden on these could exceed one percent of their sales. In addition, as contemplated by
operators, terminals in much of PADD 1 (A complete discussion of the costs to section 212 of SBREFA, EPA is also
will not have to add the fuel marker to engine and equipment manufacturers as preparing a compliance guide to help
home heating oil. No small refiner or a result of this final rule is located in small entities comply with this rule.
credit fuel could be sold in this Chapter 6 of the Final Regulatory Impact This guide will be available within 60
exclusion area. The exclusion area Analysis.) days of the effective publication date of
covers the vast majority of heating oil Based on our outreach, fact-finding, this rulemaking, and will be available
that will be marketed. Further, very and analysis of the potential impacts of on the Office of Transportation and Air
little fuel above 500 ppm will be our regulations on small businesses, it Quality Web site. Small entities may
marketed outside of the exclusion area was determined that small refiners in also contact our office to obtain copies
except directly from the refinery gate. general would likely experience a of the compliance guide.
Therefore, we expect that few terminals significant and disproportionate D. Unfunded Mandates Reform Act
outside of the exclusion area would financial hardship in reaching the
need to put in injection equipment. objectives of the nonroad diesel fuel Title II of the Unfunded Mandates
sulfur program. One indication of this Reform Act of 1995 (UMRA), Public
6. Conclusion disproportionate hardship for small Law. 104–4, establishes requirements
A cost-to-sales ratio test, a ratio of the refiners is the relatively high cost per for federal agencies to assess the effects
estimated annualized compliance costs gallon projected for producing nonroad of their regulatory actions on state,
to the value of sales per company, was diesel fuel under the proposed program. local, and tribal governments and the
performed for these entities during the Refinery modeling (of all refineries), private sector. Under section 202 of the
proposal stage of the rulemaking. 257 indicates significantly higher refining UMRA, EPA generally must prepare a
From this cost-to-sales test, we found costs for small refiners. Specifically, written statement, including a cost-
that approximately four percent (13 without special provisions, refining benefit analysis, for proposed and final
opportunity to significantly alter their compliance 257 The cost-to-sales ratio test assumes that between manufacturers/producers and consumers
plans. control costs are completely absorbed by each entity in a market context.
and does not account for or consider interaction
rules with ‘‘federal mandates’’ that may federalism implications’’ is defined in promote communications between EPA
result in expenditures to state, local, the Executive Order to include and State and local governments, EPA
and tribal governments, in the aggregate, regulations that have ‘‘substantial direct specifically solicited comment on the
or to the private sector, of $100 million effects on the States, on the relationship proposed rule from State and local
or more in any one year. Before between the national government and officials, including from the State of
promulgating an EPA rule for which a the States, or on the distribution of Alaska.
written statement is needed, section 205 power and responsibilities among the
F. Executive Order 13175: Consultation
of the UMRA generally requires EPA to various levels of government.’’
Under section 6 of Executive Order and Coordination With Indian Tribal
identify and consider a reasonable
13132, EPA may not issue a regulation Governments
number of regulatory alternatives and
adopt the least costly, most cost- that has federalism implications, that Executive Order 13175, entitled
effective, or least burdensome imposes substantial direct compliance ‘‘Consultation and Coordination with
alternative that achieves the objectives costs, and that is not required by statute, Indian Tribal Governments’’ (65 FR
of the rule. The provisions of section unless the Federal government provides 67249, November 6, 2000), requires EPA
205 do not apply when they are the funds necessary to pay the direct to develop an accountable process to
inconsistent with applicable law. compliance costs incurred by State and ensure ‘‘meaningful and timely input by
Moreover, section 205 allows EPA to local governments, or EPA consults with tribal officials in the development of
adopt an alternative other than the least State and local officials early in the regulatory policies that have tribal
costly, most cost-effective, or least process of developing the proposed implications.’’
burdensome alternative if the regulation. EPA also may not issue a This final rule does not have tribal
Administrator publishes with the final regulation that has federalism implications as specified in Executive
rule an explanation of why that implications and that preempts State Order 13175. This rule will be
alternative was not adopted. law, unless the Agency consults with implemented at the Federal level and
Before EPA establishes any regulatory State and local officials early in the impose compliance costs only on engine
requirements that may significantly or process of developing the proposed manufacturers and diesel fuel producers
uniquely affect small governments, regulation. and distributors. Tribal governments
including tribal governments, it must Section 4 of the Executive Order will be affected only to the extent they
have developed under section 203 of the contains additional requirements for purchase and use equipment with
UMRA a small government agency plan. rules that preempt State or local law, regulated engines. Thus, Executive
The plan must provide for notifying even if those rules do not have Order 13175 does not apply to this rule.
potentially affected small governments, federalism implications (i.e., the rules
will not have substantial direct effects G. Executive Order 13045: Protection of
enabling officials of affected small
on the States, on the relationship Children From Environmental Health
governments to have meaningful and
timely input in the development of EPA between the national government and and Safety Risks
regulatory proposals with significant the states, or on the distribution of Executive Order 13045, ‘‘Protection of
federal intergovernmental mandates, power and responsibilities among the Children from Environmental Health
and informing, educating, and advising various levels of government). Those Risks and Safety Risks’’ (62 FR 19885,
small governments on compliance with requirements include providing all April 23, 1997) applies to any rule that
the regulatory requirements. affected State and local officials notice (1) is determined to be ‘‘economically
This rule contains no federal and an opportunity for appropriate significant’’ as defined under Executive
mandates for state, local, or tribal participation in the development of the Order 12866, and (2) concerns an
governments as defined by the regulation. If the preemption is not environmental health or safety risk that
provisions of Title II of the UMRA. The based on express or implied statutory EPA has reason to believe may have a
rule imposes no enforceable duties on authority, EPA also must consult, to the disproportionate effect on children. If
any of these governmental entities. extent practicable, with appropriate the regulatory action meets both criteria,
Nothing in the rule would significantly State and local officials regarding the Section 5–501 of the Order directs the
or uniquely affect small governments. conflict between State law and Agency to evaluate the environmental
EPA has determined that this rule Federally protected interests within the health or safety effects of the planned
contains federal mandates that may agency’s area of regulatory rule on children, and explain why the
result in expenditures of more than responsibility. planned regulation is preferable to other
$100 million to the private sector in any This final rule does not have potentially effective and reasonably
single year. EPA believes that the final federalism implications. It will not have feasible alternatives considered by the
rule represents the least costly, most substantial direct effects on the States, Agency.
cost-effective approach to achieve the on the relationship between the national This rule is not subject to the
air quality goals of the rule. The costs government and the States, or on the Executive Order because it does not
and benefits associated with the final distribution of power and involve decisions on environmental
rule are discussed above and in the responsibilities among the various health or safety risks that may
Regulatory Impact Analysis, as required levels of government, as specified in disproportionately affect children. The
by the UMRA. Executive Order 13132. EPA believes that the emissions
Although section 6 of Executive Order reductions from the strategies proposed
E. Executive Order 13132: Federalism 13132 does not apply to this rule, EPA in this rulemaking will further improve
Executive Order 13132, entitled did consult with representatives of air quality and will further improve
‘‘Federalism’’ (64 FR 43255, August 10, various State and local governments in children’s health.
1999), requires EPA to develop an developing this rule. EPA has also
accountable process to ensure consulted representatives from H. Executive Order 13211: Actions That
‘‘meaningful and timely input by State STAPPA/ALAPCO, which represents Significantly Affect Energy Supply,
and local officials in the development of state and local air pollution officials. Distribution, or Use
regulatory policies that have federalism In the spirit of Executive Order 13132, Executive Order 13211, ‘‘Actions
implications.’’ ‘‘Policies that have and consistent with EPA policy to Concerning Regulations That
Significantly Affect Energy Supply, cents per gallon (in 2002 dollar terms) test nonroad diesel engines. However,
Distribution, or Use’’ (66 FR 28355 (May as a result of this rule. This would have the current version of that standard (ISO
22, 2001)), requires EPA to prepare and a very small effect on production 8178) is applicable only for steady-state
submit a Statement of Energy Effects to (projected reduction of approximately testing, not for transient testing. As
the Administrator of the Office of 0.02 %, or less than 4 million gallons described in the Regulatory Impact
Information and Regulatory Affairs, per year by 2036). Analysis, transient testing is an
Office of Management and Budget, for The analysis also concludes that we important part of the new emission-
certain actions identified as ‘‘significant do not expect this rule to have any control program for these engines. We
energy actions.’’ Section 4(b) of adverse effect on the supply or are therefore not adopting the ISO
Executive Order 13211 defines distribution of NRLM fuel, nor to result procedures in this rulemaking.
‘‘significant energy actions’’ as ‘‘any in a significant increase in imports of
NRLM fuel. Refiners will be unlikely to J. Congressional Review Act
action by an agency (normally
published in the Federal Register) that leave the NRLM fuel market and are The Congressional Review Act, 5
promulgates or is expected to lead to the unlikely to shut down due to this rule. U.S.C. 801 et seq., as added by the Small
promulgation of a final rule or Price impacts will vary regionally in Business Regulatory Enforcement
regulation, including notices of inquiry, the U.S., and are difficult to project Fairness Act of 1996, generally provides
advance notices of proposed precisely. Analysis of various scenarios that before a rule may take effect, the
rulemaking, and notices of proposed in RIA section 7.6 suggests that in agency promulgating the rule must
rulemaking: (1)(i) That is a significant PADDs 1 and 3 as well as 2, which submit a rule report, which includes a
regulatory action under Executive Order account for the bulk of demand, prices copy of the rule, to each House of the
12866 or any successor order, and (ii) is could increase by almost 11 cents per Congress and to the Comptroller General
likely to have a significant adverse effect gallon in the unlikely ‘‘maximum total of the United States. EPA will submit a
on the supply, distribution, or use of cost’’ scenario of constrained capacity. report containing this rule and other
energy; or (2) that is designated by the In contrast, the ‘‘average total cost’’ required information to the U.S. Senate,
Administrator of the Office of scenario predicts a 5 cent per gallon the U.S. House of Representatives, and
Information and Regulatory Affairs as a increase in PADDs 1 and 3. the Comptroller General of the United
significant energy action.’’ We have We do not believe there are any States before the rule is published in the
prepared a Statement of Energy Effects reasonable alternatives to the control of Federal Register. This rule is a ‘‘major
for this action as follows: sulfur in nonroad fuel which would rule’’ as defined by 5 U.S.C. 804(2).
We have prepared a Statement of allow the reduction in NOX and PM
XI. Statutory Provisions and Legal
Energy Effects for this action as follows. emissions from nonroad equipment
Authority
This rule’s potential adverse effects required by today’s rule. There are also
on energy supply, distribution, or use no reasonable alternatives to the control Statutory authority for the engine
have been analyzed, and are discussed of sulfur in locomotive and marine fuel controls adopted today can be found in
in detail within the following which would provide the associated sections 213 (which specifically
documents: reductions in sulfur dioxide and sulfate authorizes controls on emissions from
1. Fuel provisions of the rule and PM emissions provided by the 500 and nonroad engines and vehicles), 203–
flexibilities, including hardship 15 ppm caps on the sulfur content of 209, 216 and 301 of the Clean Air Act,
provisions, are described in this this fuel. 42 U.S.C. 7547, 7522, 7523, 7424, 7525,
Preamble, section IV.B. The provision of 7541, 7542, 7543, 7550 and 7601.
I. National Technology Transfer Statutory authority for the new fuel
sufficient lead time for refiners is Advancement Act
discussed in section IV.F. controls is found in sections 211(c) and
2. Potential impacts on fuel supplies Section 12(d) of the National 211(i) of the Clean Air Act, which allow
are summarized in Preamble section Technology Transfer and Advancement EPA to regulate fuels that either
VI.A.5, RIA section VI.A.5, and within Act of 1995 (‘‘NTTAA’’), Public Law contribute to air pollution which
the Summary and Analysis of 104–113, section 12(d) (15 U.S.C. 272 endangers public health or welfare or
Comments document, section 4.6.3. note) directs EPA to use voluntary which impair emission control
3. Costs of low-sulfur fuel are consensus standards in its regulatory equipment which is in general use or
discussed in Preamble section VI.F, and activities unless doing so would be has been in general use. 42 U.S.C.
RIA Chapter 7 (demand and production inconsistent with applicable law or 7545(c) and (i). Additional support for
in 7.1, and refining costs in 7.2). otherwise impractical. Voluntary the procedural and enforcement-related
4. Price impacts are summarized in consensus standards are technical aspects of the fuel controls in the final
Preamble section VI.A, and RIA section standards (e.g., materials specifications, rule, including the record keeping
7.6, with distribution costs in section test methods, sampling procedures, and requirements, comes from sections
7.4, alternative estimates of costs in 7.2, business practices) that are developed or 114(a) and 301(a) of the CAA. 42 U.S.C.
and effects of alternative demand adopted by voluntary consensus 7414(a) and 7601(a).
projections in 7.2 as well. Uncertainty standards bodies. The NTTAA directs List of Subjects
in fuel demand is also discussed in the EPA to provide Congress, through OMB,
Summary and Analysis of Comments explanations when the Agency decides 40 CFR Part 9
section 2.3.2.2. not to use available and applicable Reporting and recordkeeping
5. The need for adequate short-term voluntary consensus standards. requirements.
investment in low sulfur refining This rule involves technical
capacity is addressed in RIA section 5.9. standards. The following paragraph 40 CFR Part 69
6. The impacts of regulatory describes how we specify testing Environmental protection, Air
alternatives that were considered are procedures for engines subject to this pollution controls.
discussed in Preamble section VII. proposal.
In summary, the cost of No. 2 The International Organization for 40 CFR Part 80
distillate nonroad fuel is projected to Standardization (ISO) has a voluntary Fuel additives, Gasoline, Imports,
increase overall by approximately 7 consensus standard that can be used to Incorporation by reference, Labeling,
Motor vehicle pollution, Penalties, 1975 Comp. p. 973; 42 U.S.C. 241, 242b, 243, (2) On each occasion that any person
Reporting and recordkeeping 246, 300f, 300g, 300g–1, 300g–2, 300g–3, transfers custody or title to the fuel,
requirements. 300g–4, 300g–5, 300g–6, 300j–1, 300j–2, except when it is dispensed at a retail
300j–3, 300j–4, 300j–9, 1857 et seq., 6901– outlet or wholesale purchaser-consumer
40 CFR Part 86 6992k, 7401–7671q, 7542, 9601–9657, 11023,
11048.
facility, the transferor must provide to
Environmental protection, Labeling, the transferee a product transfer
Motor vehicle pollution, Reporting and § 9.1 [Amended] document stating:
recordkeeping requirements. ■ 2. Section 9.1 is amended in the table This diesel fuel is for use only in Alaska.
40 CFR Part 89 by adding the center headings and the It is exempt from the federal low sulfur
entries under those center headings in standards applicable to highway diesel fuel
Environmental protection, numerical order to read as follows: and red dye requirements applicable to non-
Administrative practice and procedure, highway diesel fuel only if it is used in
Confidential business information, * * * * * Alaska.
Imports, Labeling, Motor vehicle Control of Emissions From New, Large (b) Beginning on the implementation
pollution, Reporting and recordkeeping Nonroad Spark-Ignition Engines dates under 40 CFR 80.500, motor
requirements, Research, Vessels, 1048.20 2040–0460 vehicle diesel fuel that is designated for
Warranties. 1048.201–250 2040–0460 use in Alaska or is used in Alaska, is
40 CFR Part 94 1048.345 2040–0460 subject to the applicable provisions of
1048.350 2040–0460 40 CFR part 80, subpart I, except as
Environmental protection, 1048.420 2040–0460 provided under 40 CFR 69.52(c), (d),
Administrative practice and procedure, 1048.425 2040–0460 and (e) for commingled motor vehicle
Air pollution control, Confidential and non-motor vehicle diesel fuel.
* * * * *
business information, Imports, (c) The Governor of Alaska may
Incorporation by reference, Penalties, Control of Emissions from Recreational submit for EPA approval, by April 1,
Reporting and recordkeeping Engines and Vehicles 2002, a plan for implementing the motor
requirements, Vessels, Warranties. 1051.201–255 2060–0104 vehicle diesel fuel sulfur standard in
40 CFR Parts 1039, 1048, and 1051 1051.345 2060–0104 Alaska as an alternative to the
1051.350 2060–0104 temporary compliance option provided
Environmental protection, 1051.725 2060–0104 under 40 CFR 80.530 through 80.532. If
Administrative practice and procedure, 1051.730 2060–0104 EPA approves an alternative plan, the
Air pollution control, Confidential * * * * * provisions as approved by EPA under
business information, Imports, General Compliance Provisions for that plan shall apply to the diesel fuel
Incorporation by reference, Labeling, Nonroad Programs subject to paragraph (b) of this section.
Penalties, Reporting and recordkeeping 1068.5 2040–0460 ■ 5. A new § 69.52 is added to read as
requirements, Warranties. 1068.25 2040–0460 follows:
40 CFR Part 1065 1068.27 2040–0460
1068.120 2040–0460 § 69.52 Non-motor vehicle diesel fuel.
Environmental protection, 1068.201–260 2040–0460 (a) Definitions. (1) Areas accessible by
Administrative practice and procedure, 1068.301–355 2040–0460 the Federal Aid Highway System are the
Incorporation by reference, Reporting 1068.450 2040–0460 geographical areas of Alaska designated
and recordkeeping requirements, 1068.455 2040–0460 by the State of Alaska as being
Research. 1068.501 2040–0460 accessible by the Federal Aid Highway
1068.525 2040–0460 System.
40 CFR Part 1068 1068.530 2040–0460 (2) Areas not accessible by the Federal
Environmental protection, * * * * * Aid Highway System are all other
Administrative practice and procedure, geographical areas of Alaska.
Confidential business information, PART 69—SPECIAL EXEMPTIONS (3) Nonroad, locomotive, or marine
Imports, Motor vehicle pollution, FROM THE REQUIREMENTS OF THE diesel fuel (NRLM) has the meaning
Penalties, Reporting and recordkeeping CLEAN AIR ACT given in 40 CFR 80.2.
requirements, Warranties. (b) Applicability. NRLM diesel fuel
■ 3. The authority citation for part 69 and heating oil that are used or intended
Dated: May 11, 2004.
continues to read as follows: for use in areas of Alaska accessible by
Michael O. Leavitt,
Authority: 42 U.S.C. 7545(c), (g), and (i), the Federal Aid Highway System are
Administrator.
and 7625–1. subject to the provisions of 40 CFR part
■ For the reasons set out in the preamble, 80, subpart I, except as provided in
■ 4. Section 69.51 is revised to read as
title 40, chapter I, of the Code of Federal paragraphs (c), (d) and (e) of this
follows:
Regulations is amended as set forth section.
below. § 69.51 Motor vehicle diesel fuel. (c) Dye and marker. (1) NRLM diesel
(a) Diesel fuel that is designated for fuel and heating oil referred to in
PART 9—OMB APPROVALS UNDER use only in Alaska and is used only in paragraph (b) of this section are exempt
THE PAPERWORK REDUCTION ACT Alaska, is exempt from the sulfur from the red dye requirements, and the
■ 1. The authority citation for part 9 standard of 40 CFR 80.29(a)(1) and the presumptions associated with the red
continues to read as follows: dye provisions of 40 CFR 80.29(a)(3) dye requirements, under 40 CFR
and 40 CFR 80.29(b) until the 80.520(b)(2) and 80.510(d)(5), (e)(5), and
Authority: 7 U.S.C. 135 et seq., 136–136y;
15 U.S.C. 2001, 2003, 2005, 2006, 2601–2671; implementation dates of 40 CFR 80.500, (f)(5).
21 U.S.C. 331j, 346a, 348; 31 U.S.C. 9701; 33 provided that: (2) NRLM diesel fuel and heating oil
U.S.C. 1251 et seq., 1311, 1313d, 1314, 1318 (1) The fuel is segregated from referred to in paragraph (b) of this
1321, 1326, 1330, 1342 1344, 1345(d) and (e), nonexempt diesel fuel from the point of section are exempt from the marker
1361; E.O. 11735, 38 FR 21243, 3 CFR, 1971– such designation; and solvent yellow 124 requirements, and
the presumptions associated with the LOW SULFUR DIESEL FUEL (500 ppm ■ 7. Section 80.2 is amended by adding
marker solvent yellow 124 Sulfur Maximum) paragraph (f) and revising paragraphs (j),
requirements, under 40 CFR 80.510(d) WARNING (o), (x), (y), and (xx), removing and
through (f). Federal Law prohibits use in model year reserving paragraph (nn), adding and
(3) Exempt NRLM diesel fuel and 2007 and later highway diesel vehicles and reserving paragraphs (yy), and (zz), and
heating oil must be segregated from all engines adding and reserving paragraphs (aaa)
non-exempt NRLM diesel fuel and Its use may damage these vehicles and through (rrr) to read as follows:
heating oil. engines.
(4) Exempt heating oil must be For use in all other diesel vehicles and § 80.2 Definitions.
segregated from exempt NRLM diesel engines. * * * * *
fuel unless it also meets the standards (ii) 15 ppm sulfur diesel fuel. From (f) Previously designated diesel fuel or
of 40 CFR 80.510 applicable to the June 1, 2006 through May 31, 2010. PDD means diesel fuel that has been
NRLM diesel fuel. ULTRA-LOW SULFUR DIESEL FUEL (15
previously designated and included by
(5) Exempt NRLM diesel fuel and ppm Sulfur Maximum) a refiner or importer in a batch for
heating oil must be segregated from purposes of complying with the
Required for model year 2007 and later
motor vehicle diesel fuel, unless it also highway diesel vehicles and engines. standards and requirements of subpart I
meets the standards of 40 CFR 80.520 Recommended for use in all diesel vehicles of this part.
applicable to the motor vehicle diesel and engines. * * * * *
fuel. (j) Retail outlet means any
(d) Product transfer documents. (iii) 15 ppm sulfur diesel fuel. From
June 1, 2010, and beyond, establishment at which gasoline, diesel
Product Transfer Documents for exempt fuel, methanol, natural gas or liquified
NRLM diesel fuel and heating oil shall ULTRA-LOW SULFUR DIESEL FUEL (15
ppm Sulfur Maximum)
petroleum gas is sold or offered for sale
include the language specified in 40 for use in motor vehicles or nonroad
CFR 80.590(a) applicable to undyed Required for use in all highway and engines, including locomotive engines
diesel fuel for the appropriate sulfur nonroad diesel engines
Recommended for use in all diesel vehicles
or marine engines.
level, and the following additional * * * * *
and engines.
language as applicable: (o) Wholesale purchaser-consumer
(1) For exempt NRLM diesel fuel and (f) Non-motor vehicle diesel fuel and
means any person that is an ultimate
heating oil, including commingled fuel heating oil that is used or intended for
consumer of gasoline, diesel fuel,
under paragraph (c)(4) or (c)(5) of this use only in areas of Alaska not
methanol, natural gas, or liquified
section: ‘‘Exempt from red dye accessible by the Federal Aid Highway
petroleum gas and which purchases or
requirement applicable to diesel fuel for System, are excluded from the
obtains gasoline, diesel fuel, natural gas
non-highway purposes if it is used only applicable provisions of 40 CFR part 80,
or liquified petroleum gas from a
in Alaska.’’ subpart I, except that—
(1) All model year 2011 and later supplier for use in motor vehicles or
(2) For exempt heating oil, including
nonroad diesel engines and equipment nonroad engines, including locomotive
commingled fuel under paragraph (c)(4)
must be fueled only with diesel fuel that engines or marine engines and, in the
or (c)(5) of this section: ‘‘Exempt from
meets the specifications of 40 CFR case of gasoline, diesel fuel, methanol or
marker solvent yellow 124 requirement
80.510(b) or (c); liquified petroleum gas, receives
applicable to heating oil if it is used
(2) The following language shall be delivery of that product into a storage
only in Alaska.’’
(3) For exempt 500 ppm sulfur LM added to any product transfer tank of at least 550-gallon capacity
diesel fuel, including commingled fuel document: ‘‘This fuel is for use only in substantially under the control of that
under paragraph (c)(4) or (c)(5) of this those areas of Alaska not accessible by person.
section: ‘‘Exempt from marker solvent the FAHS’’; and * * * * *
yellow 124 requirement applicable to (3) Pump labels for such fuel that does (x) Diesel fuel means any fuel sold in
500 ppm sulfur LM diesel fuel if it is not meet the specifications of 40 CFR any State or Territory of the United
used only in Alaska.’’ 80.510(b) or (c) shall contain the States and suitable for use in diesel
(e) Pump labels. (1) Pump labels for following language: engines, and that is—
exempt NRLM diesel fuel and heating HIGH SULFUR DIESEL FUEL (may be greater (1) A distillate fuel commonly or
oil shall contain the language specified than 15 Sulfur ppm) commercially known or sold as No. 1
in 40 CFR 80.570 through 80.574 for the diesel fuel or No. 2 diesel fuel;
WARNING (2) A non-distillate fuel other than
applicable fuel type and time frame,
Federal Law prohibits use in model year residual fuel with comparable physical
unless the fuel is commingled under 2007 and later highway diesel vehicles and
paragraph (c)(4) or (c)(5) of this section. and chemical properties (e.g., biodiesel
engines, or in model year 2011 and later fuel); or
(2) Pump labels for exempt NRLM nonroad diesel engines and equipment.
diesel fuel and heating oil that are Its use may damage these vehicles and
(3) A mixture of fuels meeting the
commingled shall contain the language engines. criteria of paragraphs (1) and (2) of this
specified in 40 CFR 80.570 through definition.
(g) Alternative labels to those (y) Motor vehicle diesel fuel means
80.574 for NRLM diesel fuel and the specified in paragraphs (e)(3) and (f)(3)
applicable time frame. any diesel fuel or other distillate fuel
of this section may be used as approved that is used, intended for use, or made
(3) Pump labels for exempt NRLM by the Administrator.
diesel fuel and heating oil that are available for use in motor vehicles or
commingled with motor vehicle diesel motor vehicle engines.
PART 80—REGULATION OF FUELS
fuel shall contain the following AND FUEL ADDITIVES * * * * *
language for the applicable sulfur level (xx) Diesel fuel additive means any
and time frame: ■ 6. The authority citation for part 80 substance not composed solely of
(i) 500 ppm sulfur diesel fuel. From continues to read as follows: carbon and/or hydrogen, or of diesel
June 1, 2006 through September 30, Authority: 42 U.S.C. 7414, 7545, and blendstocks, that is added to, intended
2010. 7601(a). to be added to, used in, or offered for
use in motor vehicle diesel fuel or (hhh)–(jjj) [Reserved] production of diesel fuel from
NRLM diesel fuel or in diesel motor (kkk) Nonroad diesel engine means an processing crude oil through refinery
vehicle or diesel NRLM engine fuel engine that is designed to operate with processing units, or employ more than
systems subsequent to the production of diesel fuel that meets the definition of 1,500 people or exceed the 155,000
diesel fuel by processing crude oil from nonroad engine in 40 CFR 1068.30, bpcd crude oil capacity limit after
refinery processing units. including locomotive and marine diesel January 1, 2004 as a result of merger
(yy)–(zz) [Reserved] engines. with or acquisition of or by another
(aaa) Distillate fuel means diesel fuel (lll) Locomotive engine means an entity, are disqualified as small refiners,
and other petroleum fuels that can be engine used in a locomotive as defined except this shall not apply in the case
used in engines that are designed for under 40 CFR 92.2. of a merger between two previously
diesel fuel. For example, jet fuel, (mmm) Marine engine and Category 3 approved small refiners. If
heating oil, kerosene, No. 4 fuel, DMX, have the meanings given under 40 CFR disqualification occurs, the refiner shall
DMA, DMB, and DMC are distillate 94.2. notify EPA in writing no later than 20
fuels; and natural gas, LPG, gasoline, (nnn) Nonroad, locomotive, or marine days following this disqualifying event.
and residual fuel are not distillate fuels. (NRLM) diesel fuel means any diesel
(ii) Except as provided under
Blends containing residual fuel may be fuel or other distillate fuel that is used,
paragraph (b)(1)(iii) of this section, any
distillate fuels. intended for use, or made available for
refiner whose status changes under this
(bbb) Residual fuel means a petroleum use, as a fuel in any nonroad diesel
paragraph shall meet the applicable
fuel that can only be used in diesel engines, including locomotive and
standards of § 80.195 within a period of
engines if it is preheated before marine diesel engines, except the
up to 30 months of the disqualifying
injection. For example, No. 5 fuels, No. following: Distillate fuel with a T90
event for any of its refineries that were
6 fuels, and RM grade marine fuels are greater than 700 °F that is used only in
previously subject to the small refiner
residual fuels. Note: Residual fuels do Category 2 and 3 marine engines is not
NRLM diesel fuel. Use the distillation standards of § 80.240(a). However, such
not necessarily require heating for period shall not extend beyond
storage or pumping. test method specified in 40 CFR
1065.1010 to determine the T90 of the December 31, 2007, or, for refineries for
(ccc) Heating oil means any No. 1 or
fuel. NR diesel fuel and LM diesel fuel which the Administrator has approved
No. 2 distillate fuel that is sold for use
are subcategories of NRLM diesel fuel. an extension of the small refiner
in furnaces, boilers, stationary diesel
(ooo) Nonroad (NR) diesel fuel means gasoline sulfur standards under
engines, and similar applications and
any NRLM diesel fuel that is not § 80.553(c), December 31, 2010.
which is commonly or commercially
known or sold as heating oil, fuel oil, ‘‘locomotive or marine (LM) diesel (iii) A refiner may apply to EPA for
and similar trade names, and that is not fuel.’’ an additional six months to comply
jet fuel, kerosene, or MVNRLM diesel (ppp) Locomotive or marine (LM) with the standards of § 80.195 if more
fuel. diesel fuel means any diesel fuel or than 30 months will be required for the
(ddd) Jet fuel means any distillate fuel other distillate fuel that is used, necessary engineering, permitting,
used, intended for use, or made intended for use, or made available for construction, and start-up work to be
available for use in aircraft. use, as a fuel in locomotive or marine completed. Such applications must
(eee) Kerosene means any No.1 diesel engines, except for the following include detailed technical information
distillate fuel commonly or fuels: supporting the need for additional time.
commercially sold as kerosene. (1) Fuel that is also used, intended for EPA will base its decision to approve
(fff) #1D means the distillate fuel use, or made available for use in motor additional time on the information
classification relating to ‘‘No. 1–D’’ vehicle engines or nonroad engines provided by the refiner and on other
diesel fuels as described in ASTM D other than locomotive and marine diesel relevant information. In no case will
975–04. The Director of the Federal engines is not LM diesel fuel. EPA extend the compliance date beyond
Register approved the incorporation by (2) Distillate fuel with a T90 greater December 31, 2007, or, for refineries for
reference of ASTM D 975–04, Standard than 700 °F that is used only in Category which the Administrator has approved
Specification for Diesel Fuel Oils, as 2 and 3 marine engines is not LM diesel an extension of the small refiner
prescribed in 5 U.S.C. 552(a) and 1 CFR fuel. Use the distillation test method gasoline sulfur standards under
part 51. Anyone may purchase copies of specified in 40 CFR 1065.1010 to § 80.553(c), December 31, 2010.
this standard from the American Society determine the T90 of the fuel. (iv) During the period of time up to 30
for Testing and Materials, 100 Barr (qqq) MVNRLM diesel fuel means any months provided under paragraph
Harbor Dr., West Conshohocken, PA diesel fuel or other distillate fuel that (b)(1)(ii) of this section, and any
19428. Anyone may inspect copies at meets the definition of motor vehicle extension provided under paragraph
the U.S. EPA, Air and Radiation Docket (MV) or nonroad, locomotive, or marine (b)(1)(iii) of this section, the refiner may
(NRLM) diesel fuel. Motor vehicle diesel not generate gasoline sulfur credits
and Information Center, 1301
fuel, NRLM diesel fuel, NR diesel fuel, under § 80.310.
Constitution Ave., NW., Room B102,
and LM diesel fuel are subcategories of (2) Any refiner who qualifies as a
EPA West Building, Washington, DC
MVNRLM diesel fuel. small refiner under § 80.225 may elect
20460 or at the National Archives and (rrr) Solvent yellow 124 means N
Records Administration (NARA). For to meet the standards under § 80.195 by
ethyl-N-[2-[1-(2 notifying EPA in writing no later than
information on the availability of this methylpropoxy)ethoxyl]-4-phenylazo]
material at NARA, call 202–741–6030, November 15 prior to the year that the
benzeneamine.
or go to: http://www.archives.gov/ change will occur. Any refiner whose
■ 8. Section 80.230 is amended by
federal_register/ status changes under this paragraph
revising paragraph (b) to read as follows:
code_of_federal_regulations/ (b)(2) shall meet the standards under
ibr_locations.html. § 80.230 Who is not eligible for the § 80.195 beginning with the first
(ggg) #2D means the distillate fuel hardship provisions for small refiners? averaging period subsequent to the
classification relating to ‘‘No. 2–D’’ * * * * * status change.
diesel fuels as described in ASTM D (b)(1)(i) Refiners who qualify as small ■ 9. Section 80.240 is amended by
975–04. under § 80.225 and subsequently cease adding paragraph (f) to read as follows:
§ 80.240 What are the small refiner marine diesel engines, at any import facility is aggregated with other
gasoline sulfur standards? downstream location. facilities, then the aggregated facility is
* * * * * (b) Excluded fuel. The provisions of treated as a refinery or import facility.
(f)(1) In the case of a refiner without this subpart do not apply to distillate (3) Retail outlets or wholesale
approved small refiner status who fuel that is designated for export outside purchaser consumers may not be
acquires a refinery from a refiner with the United States in accordance with aggregated with any other facility.
approved small refiner status under § 80.598, identified for export by a (4) Where an entity maintains custody
§ 80.235, the applicable small refiner transfer document as required under of diesel fuel in one or more mobile
standards under paragraph (a) of this § 80.590, and that is exported. components (e.g., rail, barge, or trucking
section will apply to the acquired small ■ 12. A new § 80.502 is added to read as operations) the mobile components may
refinery for a period up to 30 months follows: be aggregated as a single facility. Mobile
from the date of acquisition of the components may also be aggregated
§ 80.502 What definitions apply for
refinery, but no later than December 31, with a facility from which they receive
purposes of this subpart?
2007, or, for a refinery for which the fuel or a facility to which they deliver
The definitions of § 80.2 and the fuel. However, mobile components may
Administrator has approved an
following additional definitions apply not be aggregated with both a facility
extension of the small refiner gasoline
to this subpart I: from which they receive fuel and a
sulfur standards under § 80.553(c),
(a) Entity means any refiner, importer,
December 31, 2010, after which time the facility to which they deliver fuel.
distributor, retailer or wholesale- (5) An individual refinery or
standards of § 80.195 shall apply to the
purchaser consumer of any distillate contiguous pipeline may not be
acquired refinery.
fuel. subdivided into more than one facility.
(2) A refiner may apply to EPA for an (b) Facility means any place, or series
additional six months to comply with An individual terminal may not be
of places, where an entity produces,
the standards of § 80.195 for the subdivided into more than one facility
imports, or maintains custody of any
acquired refinery if more than 30 unless approved by the Administrator.
distillate fuel from the time it is (c) Truck loading terminal means any
months will be required for the received to the time custody is
necessary engineering, permitting, facility that dyes NRLM diesel fuel, pays
transferred to another entity, except as taxes on motor vehicle diesel fuel per
construction, and start-up work to be described in paragraphs (b)(1) through
completed. Such applications must IRS code (26 CFR part 48), or adds a fuel
(b)(4) of this section: marker pursuant to § 80.510 to heating
include detailed technical information (1) Where an entity maintains custody
supporting the need for additional time. oil and delivers diesel fuel or heating oil
of a batch of diesel fuel from one place
EPA will base its decision to approve into trucks for delivery to retail or
in the distribution system to another
additional time on information provided ultimate consumer locations.
place (e.g., from a pipeline to a (d) Batch means a quantity of diesel
by the refiner and on other relevant terminal), all owned by the same entity,
information. In no case will EPA extend fuel or distillate which is homogeneous
both places combined are considered to with regard to those properties that are
the compliance date beyond December be one single aggregated facility, except
31, 2007, or, for a refinery for which the specified for MVNRLM diesel fuel
where an entity chooses to treat under this subpart I of this part, has the
Administrator has approved an components of such an aggregated
extension of the small refiner gasoline same designation under this subpart I (if
facility as separate facilities. The choice applicable), and whose custody is
sulfur standards under § 80.553(c), made to treat these places as separate
December 31, 2010. transferred from one facility to another
facilities may not be changed by the facility.
entity during any applicable compliance (e) Downstream location means any
removing paragraph (f) and revising the period. Except as specified in paragraph
section heading to read as follows: point in the diesel fuel distribution
(b)(2) of this section, where compliance system that is downstream of refineries
80.500 What are the implementation dates requirements depend upon facility-type, and import facilities, for example, diesel
for the motor vehicle diesel fuel sulfur the entire facility must comply with the fuel at facilities of distributors, carriers,
control program? requirements that apply to its retailers, kerosene blenders, and
■ 11. Section 80.501 is revised to read as components as follows: wholesale purchaser-consumers.
follows: (i) If an aggregated facility includes a ■ 13. A new § 80.510 is added to read as
refinery, the entire facility must comply follows:
§ 80.501 What fuel is subject to the with the requirements applicable to
provisions of this subpart? refineries. § 80.510 What are the standards and
(a) Included fuel and additives. The (ii) If an aggregated facility includes a marker requirements for NRLM diesel fuel?
provisions of this subpart apply to the truck loading terminal but not a (a) Beginning June 1, 2007. Except as
following fuels and additives except as refinery, the entire facility must comply otherwise specifically provided in this
specified in paragraph (b) of this with the requirements applicable to subpart, all NRLM diesel fuel is subject
section: truck loading terminals. to the following per-gallon standards:
(1) Motor vehicle diesel fuel. (2) A refinery or import facility may (1) Sulfur content. 500 parts per
(2) Nonroad, locomotive, or marine not be aggregated with facilities that million (ppm) maximum.
diesel fuel. receive fuel from other refineries or (2) Cetane index or aromatic content,
(3) Diesel fuel additives. import facilities, either directly or as follows:
(4) Heating oil. indirectly. For example, a refinery may (i) A minimum cetane index of 40; or
(5) Other distillate fuels. not be aggregated with a terminal that (ii) A maximum aromatic content of
(6) Motor oil that is used as or receives any fuel from a common carrier 35 volume percent.
intended for use as fuel in diesel motor pipeline. However, a refinery may be (b) Beginning June 1, 2010. Except as
vehicles or nonroad diesel engines or is aggregated with a pipeline and terminal otherwise specifically provided in this
blended with diesel fuel for use in that are owned by the same entity and subpart, all NR and LM diesel fuel is
diesel motor vehicles or nonroad diesel which receive no fuel from any source subject to the following per-gallon
engines, including locomotive and other than the refinery. If a refinery or standards:
(1) Sulfur content. heating oil, as appropriate, and shall be Greene), and the eight eastern-most
(i) 15 ppm maximum for NR diesel prohibited from use in any motor counties of West Virginia (Jefferson,
fuel. vehicle or nonroad diesel engine (except Berkeley, Morgan, Hampshire, Mineral,
(ii) 500 ppm maximum for LM diesel for locomotive or marine diesel Hardy, Grant, and Pendleton).
fuel. engines). (2) Alaska.
(2) Cetane index or aromatic content, (4) Except as provided for in (h) Pursuant and subject to the
as follows: paragraph (i) of this section, any diesel provisions of §§ 80.536, 80.554, 80.560,
(i) A minimum cetane index of 40; or fuel, other than jet fuel or kerosene that and 80.561:
(ii) A maximum aromatic content of is downstream of a truck loading (1) Except as provided in paragraph (j)
35 volume percent. terminal, that contains less than 0.10 of this section, from June 1, 2007
(c) Beginning June 1, 2012. Except as milligrams per liter of marker solvent through May 31, 2010, NRLM diesel fuel
otherwise specifically provided in this yellow 124 shall be considered motor produced or imported in full
subpart, all NRLM diesel fuel is subject vehicle diesel fuel or NR diesel fuel, as compliance with the requirements of
to the following per-gallon standards: appropriate. §§ 80.536, 80.554, 80.560, and 80.561 is
(1) Sulfur content. 15 ppm maximum. (5) Any LM diesel fuel or heating oil exempt from the per-gallon sulfur
(2) Cetane index or aromatic content, that is required to contain marker content standard and cetane or
as follows: solvent yellow 124 pursuant to the aromatics standard of paragraph (a) of
(i) A minimum cetane index of 40; or requirements of this paragraph (e) must this section.
(ii) A maximum aromatic content of also contain visible evidence of dye (2) Except as provided in paragraph (j)
35 volume percent. solvent red 164. of this section, from June 1, 2010
(d) Marking provisions. From June 1, (f) Marking provisions. Beginning June through May 31, 2012 for NR diesel fuel
2007 through May 31, 2010: 1, 2012: and from June 1, 2012 through May 31,
(1) Except as provided for in (1) Except as provided for in 2014 for NRLM diesel fuel produced or
paragraph (i) of this section, prior to paragraph (i) of this section, prior to imported in full compliance with the
distribution from a truck loading distribution from a truck loading requirements of §§ 80.536, 80.554,
terminal, all heating oil shall contain six terminal, all heating oil shall contain six 80.560, and 80.561 is exempt from the
milligrams per liter of marker solvent milligrams per liter of marker solvent per-gallon standards of paragraphs (b)
yellow 124. yellow 124. and (c) of this section, but is subject to
(2) All motor vehicle and NRLM (2) All motor vehicle and NRLM the per-gallon standards of paragraph (a)
diesel fuel shall be free of solvent diesel fuel shall be free of marker of this section.
yellow 124. solvent yellow 124. (i) The marking requirements of
(3) Any diesel fuel that contains (3) Any diesel fuel that contains paragraphs (d)(1), (d)(4), (e)(1), (e)(4),
greater than or equal to 0.10 milligrams greater than or equal to 0.10 milligrams (f)(1), and (f)(4) of this section do not
per liter of marker solvent yellow 124 per liter of marker solvent yellow 124 apply to heating oil, or, for paragraphs
shall be deemed to be heating oil and shall be deemed to be heating oil and (e)(1) and (e)(4) of this section, diesel
shall be prohibited from use in any shall be prohibited from use in any fuel designated as LM diesel fuel that is
motor vehicle or nonroad diesel engine motor vehicle or nonroad diesel engine distributed from a truck loading
(including locomotive, or marine diesel (including locomotive, or marine diesel terminal located within the areas listed
engines). engines). in paragraphs (g)(1) and (g)(2) of this
(4) Except as provided for in (4) Except as provided for in section and is for sale or intended for
paragraph (i) of this section, any diesel paragraph (i) of this section, any diesel sale within these areas, or that is
fuel, other than jet fuel or kerosene that fuel, other than jet fuel or kerosene that distributed from any other truck loading
is downstream of a truck loading is downstream of a truck loading terminal and is for sale or intended for
terminal, that contains less than 0.10 terminal, that contains less than 0.10 sale within the area listed in (g)(2) of
milligrams per liter of marker solvent milligrams per liter of marker solvent this section.
yellow 124 shall be considered motor yellow 124 shall be considered motor (j) The provisions of paragraphs (h)(1)
vehicle diesel fuel or NRLM diesel fuel, vehicle diesel fuel or NRLM diesel fuel, and (h)(2) of this section do not apply
as appropriate. as appropriate. to diesel fuel sold or intended for sale
(5) Any heating oil that is required to (5) Any heating oil that is required to in the areas listed in paragraph (g)(1) of
contain marker solvent yellow 124 contain marker solvent yellow 124 this section that is produced or
pursuant to the requirements of this pursuant to the requirements of this imported in full compliance with the
paragraph (d) must also contain visible paragraph (f) must also contain visible requirements of §§ 80.536 and 80.554 or
evidence of dye solvent red 164. evidence of dye solvent red 164. to diesel fuel sold or intended for sale
(e) Marking provisions. From June 1, (g) Special provisions in this part
in the area listed in paragraph (g)(2) of
2010 through May 31, 2012: apply to the following areas:
(1) Northeast/Mid-Atlantic Area this section that is produced or
(1) Except as provided for in
which includes the following states and imported in full compliance with the
paragraph (i) of this section, prior to
counties: North Carolina, Virginia, requirements of § 80.536.
distribution from a truck loading ■ 14. A new § 80.511 is added to read as
terminal, all heating oil and diesel fuel Maryland, Delaware, New Jersey,
follows:
designated as 500 ppm sulfur LM diesel Connecticut, Rhode Island,
fuel shall contain six milligrams per Massachusetts, Vermont, New § 80.511 What are the per-gallon and
liter of solvent yellow 124. Hampshire, Maine, Washington D.C., marker requirements that apply to NRLM
(2) All motor vehicle and NR diesel New York (except for the counties of diesel fuel and heating oil downstream of
fuel shall be free of marker solvent Chautauqua, Cattaraugus, and the refiner or importer?
yellow 124. Allegany), Pennsylvania (except for the (a) Applicable dates for marker
(3) Any diesel fuel that contains counties of Erie, Warren, Mc Kean, requirements. Beginning June 1, 2006,
greater than or equal to 0.10 milligrams Potter, Cameron, Elk, Jefferson, Clarion, all NRLM diesel fuel shall contain less
per liter of marker solvent yellow 124 Forest, Venango, Mercer, Crawford, than 0.10 milligrams per liter of the
shall be deemed to be LM diesel fuel or Lawrence, Beaver, Washington, and marker solvent yellow 124, except for
LM diesel fuel subject to the marking for all downstream locations other than including any diesel fuel tank bottoms,
requirements of § 80.510(e). retail outlets or wholesale purchaser- prior to the point of blending, sampling
(b) Applicable dates for per-gallon consumer facilities, shall apply to all and testing in the importer entity’s
standards. (1) Beginning June 1, 2006, NR diesel fuel beginning October 1, refinery operation. The DTAB may,
all NRLM diesel fuel must comply with 2010 for retail outlets and wholesale however, be added to a diesel fuel
the per-gallon sulfur standard for the purchaser-consumer facilities, and shall blending tank where the diesel fuel tank
designation or classification stated on apply to all NR diesel fuel beginning bottom is not included as part of the
its PTD, pump label, or other December 1, 2010 for all locations. batch volume for a prior batch. In
documentation. Based on the provisions (7) For all NRLM diesel fuel that is addition, the DTAB may be placed into
of § 80.510(h) and (j), there is no sold or intended for sale in the areas a storage tank that contains other DTAB
uniform downstream sulfur standard listed in § 80.510(g)(1), the per-gallon imported by that importer. The DTAB
until the downstream dates identified in sulfur standard of § 80.510(c) shall also may be discharged into a tank
paragraphs (b)(3) through (b)(8) of this apply to all NRLM diesel fuel beginning containing finished diesel fuel of the
section. August 1, 2012 for all downstream same category as the diesel fuel which
(2) Except as provided in paragraphs locations other than retail outlets or will be produced using the DTAB (for
(b)(5) and (b)(8) of this section, wholesale purchaser-consumer example, 15 ppm sulfur undyed or 15
beginning December 1, 2010, all NRLM facilities, shall apply to all NRLM diesel ppm sulfur dyed diesel fuel) provided
diesel fuel must comply with the cetane fuel beginning October 1, 2012 for retail the blending process is performed in
index or aromatics standard of § 80.510. outlets and wholesale purchaser- that same tank.
(3) Except as provided in paragraphs consumer facilities, and shall apply to (e) The entity must account for the
(b)(5) through (b)(8) of this section, the all NRLM diesel fuel beginning volume of diesel fuel produced using
per-gallon sulfur standard of § 80.510(a) December 1, 2012 for all locations. DTAB in a manner that excludes the
shall apply to all NRLM diesel fuel (8) The provisions of paragraphs (b)(5) volume of any previously designated
beginning August 1, 2010 for all through (b)(7) of this section shall apply diesel fuel. The diesel fuel tank bottom
downstream locations other than retail for all NRLM or NR diesel fuel that is may not be included in the company’s
outlets or wholesale purchaser- sold or intended for sale in the area refinery compliance calculations for that
consumer facilities, shall apply to all listed in § 80.510(g)(2), except for NRLM batch of diesel fuel if the fuel in that
NRLM diesel fuel beginning October 1, or NR diesel fuel that is produced in tank bottom has been previously
2010 for retail outlets and wholesale accordance with a compliance plan designated by a refiner or importer. This
purchaser-consumer facilities, and shall approved under § 80.554. exclusion of previously designated
apply to all NRLM diesel fuel beginning (9) For the purposes of this section, diesel fuel must be accomplished using
December 1, 2010 for all locations. distributors that have their own fuel the following approach:
(4) Except as provided in paragraphs storage tanks and deliver only to (1) Determine the volume of any tank
(b)(5) through (b)(8) of this section, the ultimate consumers shall be treated the bottom that is previously designated
per-gallon sulfur standard of § 80.510(c) same as retailers and their facilities diesel fuel before any diesel fuel
shall apply to all NRLM diesel fuel treated the same as retail outlets. production begins.
beginning August 1, 2014 for all ■ 15. A new § 80.512 is added to read as (2) Add the DTAB plus any
downstream locations other than retail follows: blendstock to the storage tank, and
outlets or wholesale purchaser- completely mix the tank.
consumer facilities, shall apply to all § 80.512 May an importer treat diesel fuel (3) Determine the volume and sulfur
NRLM diesel fuel beginning October 1, as blendstock? content of the diesel fuel contained in
2014 for retail outlets and wholesale An importer may exclude diesel fuel the storage tank after blending is
purchaser-consumer facilities, and shall that it imports from the requirements complete. Mathematically subtract the
apply to all NRLM diesel fuel beginning under this subpart, and instead may volume of the tank bottom to determine
December 1, 2014 for all locations. This designate such diesel fuel as diesel fuel the volume of the DTAB plus
paragraph (b)(4) does not apply to LM treated as blendstock (DTAB), if all the blendstock added, and subsequently
diesel fuel that is sold or intended for following conditions are met: transferred to another facility. Such fuel
sale in areas other than those listed in (a) The DTAB must be included in all is reported to EPA as a batch of diesel
§ 80.510(g)(1) or (g)(2). applicable designation, credit and fuel under §§ 80.593, 80.601, and
(5) For all NRLM diesel fuel that is compliance calculations for diesel fuel 80.604.
sold or intended for sale in the areas for a refinery operated by the same (4) If previously designated motor
listed in § 80.510(g)(1), the per-gallon entity that is the importer . That entity vehicle diesel fuel having a sulfur
sulfur standard and the cetane index or must meet all refiner standards and content of 15 ppm or less is blended
aromatics standard of 80.510(a) shall requirements. with DTAB, and the combined product
apply to all NRLM diesel fuel beginning (b) The importer entity may not after blending has a sulfur content that
August 1, 2007 for all downstream transfer title of the DTAB to another exceeds 15 ppm, the importer entity, in
locations other than retail outlets or entity until the DTAB has been used to its capacity as a refiner, must
wholesale purchaser-consumer produce diesel fuel and all refiner redesignate all the diesel fuel as 500
facilities, shall apply to all NRLM diesel standards and requirements have been ppm sulfur motor vehicle diesel fuel for
fuel beginning October 1, 2007 for retail met for the diesel fuel produced. purposes of the temporary compliance
outlets and wholesale purchaser- (c) The refinery at which the DTAB is option under § 80.530, or other
consumer facilities, and shall apply to used to produce diesel fuel must be permissible redesignation under
all NRLM diesel fuel beginning physically located at either the same § 80.598. If #2D 15 ppm sulfur motor
December 1, 2007 for all locations. terminal at which the DTAB first arrives vehicle diesel fuel is redesignated as
(6) For all NR diesel fuel that is sold in the U.S., the import facility, or at a #2D 500 ppm sulfur motor vehicle
or intended for sale in the areas listed facility to which the DTAB is directly diesel fuel, such entity must apply the
in § 80.510(g)(1), the per-gallon sulfur transported from the import facility. volume of previously designated 15
standard of § 80.510(b) shall apply to all (d) The DTAB must be completely ppm sulfur diesel fuel, for purposes of
NR diesel fuel beginning August 1, 2010 segregated from any other diesel fuel, its operations as a distributor, to its
downgrading limitation under § 80.527, (b) Beginning June 1, 2010, motor level less than or equal to 500 ppm, and Ä
if applicable, and for volume balancing vehicle diesel fuel produced by a designated as NRLM or LM that has not Ä
purposes under § 80.599. transmix processor is subject to the yet been distributed from a truck Ä
(5) As an alternative to paragraphs sulfur standard under § 80.520(a)(1). loading terminal or bulk terminal to a Ä
(e)(1) through (e)(4) of this section, (c) From June 1, 2007 through May 31, retail outlet, wholesale purchaser-Ä
where an importer has a blending tank 2010, NRLM diesel fuel produced by a consumer or ultimate consumer.Ä
that is used only to combine DTAB and transmix processor is exempt from the * * * * *Ä
blending components, and no standards of § 80.510(a). This paragraph ■ 18. Section 80.521 is revised to read as Ä
previously designated diesel fuel is (c) does not apply to NRLM diesel fuel follows:Ä
added to the tank, the importer entity, that is sold or intended for sale in the
in its capacity as a refiner, may account areas listed in § 80.510(g)(1) or (g)(2). § 80.521 What are the standards and
for the diesel fuel produced in such a (d) From June 1, 2010 through May identification requirements for diesel fuel
blending tank by sampling and testing 31, 2014, NRLM diesel fuel produced by additives?
for the sulfur content of the batch after a transmix processor is subject to the (a) Except as provided in paragraph
DTAB and blendstock are added and standards under § 80.510(a). This (b) of this section, any diesel fuel
mixed, and reporting the volume of paragraph (d) does not apply to NRLM additive that is added to, intended for
diesel fuel transferred from that tank to diesel fuel that is sold or intended for adding to, used in, or offered for use in
a different facility, up to the point sale in the areas listed in § 80.510(g)(1) any MVNRLM diesel fuel subject to the
where a new blend is produced by or (g)(2). 15 ppm sulfur content standards of
adding new DTAB and blendstock. (e) From June 1, 2014 and beyond, § 80.510(b), § 80.510(c), or § 80.520(a) at
(f) The importer must include the NRLM diesel fuel produced by a any downstream location must—
volume and sulfur content of each batch transmix processor is subject to the (1) Have a sulfur content less than or
of DTAB in the annual importer reports standards of § 80.510(c), except that LM equal to 15 ppm.
to EPA, as prescribed under §§ 80.593, diesel fuel is subject to the sulfur (2) Be accompanied by a product
80.601, and 80.604, but with a notation standard of § 80.510(a). This paragraph transfer document pursuant to § 80.591
that the batch is not included in the (e) does not apply to NRLM or LM indicating that the additive complies
importer compliance calculations diesel fuel that is sold or intended for with the 15 ppm sulfur standard for
because the product is DTAB. Any sale in the areas listed in § 80.510(g)(1) diesel fuel, except for those diesel fuel
DTAB that ultimately is not used in the or (g)(2). additives which are only sold in
importer’s refinery operation (for ■ 17. Section 80.520 is amended by containers for use by the ultimate
example, a tank bottom of DTAB at the revising paragraph (b) and removing consumer of diesel fuel and which are
conclusion of the refinery operation), paragraph (d) to read as follows: subject to the requirements of
must be treated as newly imported § 80.591(d).
§ 80.520 What are the standards and dye (b) Any diesel fuel additive that is
diesel fuel, for which all required
requirements for motor vehicle diesel fuel? added to, intended for adding to, used
sampling and testing, and recordkeeping
must be accomplished, and included in * * * * * in, or offered for use in diesel fuel
the importer’s compliance calculations (b) Dye requirements. (1) All motor subject to the 15 ppm sulfur content
for the averaging period when this vehicle diesel fuel shall be free of standards of § 80.510(b) or (c) or
sampling and testing occurs. visible evidence of dye solvent red 164 § 80.520(a) may have a sulfur content
(g) The importer must retain records (which has a characteristic red color in exceeding 15 ppm provided that each of
that reflect the importation, sampling diesel fuel), except for motor vehicle the following conditions are met:
and testing, and physical movement of diesel fuel that is used in a manner that (1) The additive is added to or used
any DTAB, and must make these records is tax exempt under section 4082 of the in the diesel fuel in a quantity less than
available to EPA on request. Internal Revenue Code. All motor one percent by volume of the resultant
■ 16. A new § 80.513 is added to read as vehicle diesel fuel shall be free of additive/diesel fuel mixture;
follows: yellow solvent 124. (2) The product transfer document
(2) Until June 1, 2010, any #1D or #2D complies with the informational
§ 80.513 What provisions apply to distillate fuel that does not show visible requirements of § 80.591; and
transmix processing facilities? evidence of dye solvent red 164 shall be (3) The additive is not used or
For purposes of this section, transmix considered to be motor vehicle diesel intended for use by an ultimate
means a mixture of finished fuels that fuel and subject to all the requirements consumer in diesel motor vehicles or
no longer meets the specifications for a of this subpart for motor vehicle diesel nonroad diesel engines.
fuel that can be used or sold without fuel, except for distillate fuel designated ■ 19. Section 80.522 is revised to read as
further processing. This section applies or classified as any of the following: follows:
to refineries that produce diesel fuel (i) For use only in the State of Alaska,
from transmix by distillation or other as provided under 40 CFR 69.51. § 80.522 May used motor oil be dispensed
refining processes but do not produce (ii) For use under a national security into diesel motor vehicles or nonroad diesel
diesel fuel by processing crude oil. This exemption under § 80.606 or for use engines?
section only applies to the volume of only in a research and development No person may introduce used motor
diesel fuel produced by such a transmix testing program exempted under oil, or used motor oil blended with
processor using these processes, and § 80.607. diesel fuel, into the fuel system of
does not apply to any diesel fuel (iii) For use in the U.S. Territories as model year 2007 or later diesel motor
produced by the blending of provided under § 80.608. vehicles or model year 2011 or later
blendstocks. (iv) Jet fuel meeting the definition nonroad diesel engines (not including
(a) From June 1, 2006 through May 31, under § 80.2. locomotive or marine diesel engines),
2010, motor vehicle diesel fuel (v) Kerosene meeting the definition unless both of the following
produced by a transmix processor is under § 80.2. requirements have been met:
subject to the 500 ppm sulfur standard (vi) Diesel fuel that is produced (a) The vehicle or engine
under § 80.520(c). beginning June 1, 2006, with a sulfur manufacturer has received a Certificate
of Conformity under 40 CFR part 86, 40 (4) Compliance with the limitation of during a compliance period (V500, as
CFR part 89, or 40 CFR part 1039 and paragraph (c)(1) of this section shall be provided in paragraph (a)(5) of this
the certification of the vehicle or engine as calculated under § 80.599(e). section, may not exceed the following
configuration is explicitly based on (d) Diesel fuel in violation of the 15 volume limit:
emissions data with the addition of ppm standard. Where motor vehicle (A) For the compliance periods prior
motor oil; and diesel fuel subject to the 15 ppm sulfur to the period from July 1, 2009 through
(b) The oil is added in a manner and standard of § 80.520(a)(1) is found to be May 31, 2010, 20 percent of the volume
rate consistent with the conditions of in violation of any standard under of motor vehicle diesel fuel that is
the Certificate of Conformity. § 80.520(a) and is consequently produced or imported during a
■ 20. Section 80.523 is removed and downgraded to 500 ppm sulfur motor compliance period (Vt) plus an
reserved. vehicle diesel fuel, the person having additional volume of motor vehicle
custody of the fuel at the time it is found diesel fuel represented by credits
§ 80.523 [Removed and Reserved] to be in violation must include the properly generated and used pursuant to
■ 21. Section 80.527 is revised to read as volume of such downgraded fuel toward the requirements of §§ 80.531 and
follows: its 20 percent volume limitation under 80.532.
paragraph (c)(1) of this section, unless (B) For the compliance period from
§ 80.527 Under what conditions may motor July 1, 2009 through May 31, 2010, 20
vehicle diesel fuel subject to the 15 ppm the person demonstrates that it did not
cause the violation. percent of the volume of motor vehicle
sulfur standard be downgraded to motor
vehicle diesel fuel subject to the 500 ppm (e) Special provisions for retail outlets diesel fuel that is produced or imported
sulfur standard? and wholesale purchaser-consumer prior to January 1, 2010 during the
facilities. Notwithstanding the compliance period (Vt), plus an
(a) Definitions. As used in this
provisions of paragraph (c)(1) of this additional volume of motor vehicle
section, downgrade means changing the diesel fuel represented by credits
designation or classification of motor section, retailers and wholesale
purchaser-consumers shall comply with properly generated and used pursuant to
vehicle diesel fuel subject to the 15 ppm the requirements of §§ 80.531 and
sulfur standard under § 80.520(a)(1) to the downgrading limitation as follows:
(1) Retailers and wholesale purchaser- 80.532. From January 1, 2010 through
motor vehicle diesel fuel subject to the May 31, 2010, the volume of motor
500 ppm sulfur standard under consumers who sell, offer for sale, or
dispense motor vehicle diesel fuel that vehicle diesel fuel that is produced or
§ 80.520(c). A downgrade occurs when imported shall not exceed the volume
the change in designation or is subject to the 15 ppm sulfur standard
under § 80.520(a)(1) are exempt from the represented by credits used pursuant to
classification takes place. Changing the § 80.532.
designation or classification of motor volume limitations of paragraph (c)(1) of
this section. (ii) The terms V500 and Vt have the
vehicle diesel fuel subject to the 15 ppm meaning specified in § 80.531(a)(2).
sulfur standard under § 80.520(a)(1) to (2) A retailer or wholesale purchaser-
consumer who does not sell, offer for (4) Compliance with the volume limit
any designation or classification that is in paragraph (a)(3) of this section must
not a motor vehicle diesel fuel is not a sale, or dispense motor vehicle diesel
be determined separately for each
downgrade for purposes of this section. fuel subject to the 15 ppm sulfur
refinery. For an importer, such
(b) Who is subject to the downgrade standard under § 80.520(a)(1) must
compliance must be determined
limitation: Any distributor, retailer, or comply with the downgrading
separately for each Credit Trading Area
wholesale purchaser consumer that limitations of paragraph (c) of this
(as defined in § 80.531) into which
takes custody of any diesel fuel section, and compliance shall be
motor vehicle diesel fuel is imported. If
designated or classified as #2D 15 ppm calculated as specified in § 80.599(e)(2).
(f) Termination of downgrading a party is both a refiner and an importer,
sulfur motor vehicle diesel fuel and such compliance shall be determined
delivers any diesel fuel designated or limitations. The provisions of this
section shall not apply after May 31, separately for the refining and
classified as #2D 500 ppm motor vehicle importation activities.
diesel fuel. 2010.
(5) Compliance with the volume limit
(c) Downgrading limitation. (1) Except in paragraph (a)(3) of this section shall
as provided in paragraphs (d) and (e) of follows:
be determined on an annual basis,
this section, a person described in § 80.530 Under what conditions can 500 where the annual compliance period is
paragraph (b) of this section may not ppm motor vehicle diesel fuel be produced from July 1 through June 30. For the
downgrade a total of more than 20 or imported after May 31, 2006? year 2006, compliance shall be
percent of the #2D motor vehicle diesel (a) Beginning June 1, 2006, a refiner determined for the period June 1, 2006
fuel (by volume) that is subject to the 15 or importer may produce or import through June 30, 2007. For the year
ppm sulfur standard of § 80.520(a)(1) to motor vehicle diesel fuel subject to the 2010, compliance shall be determined
#2D motor vehicle diesel fuel subject to 500 ppm sulfur content standard of for the period of July 1, 2009 through
the sulfur standard of § 80.520(c) while § 80.520(c) if all of the following May 31, 2010.
such person has custody of such fuel. requirements are met: (6) Any motor vehicle diesel fuel
(2) The limitation of paragraph (c)(1) (1) Each batch of motor vehicle diesel produced or imported above the volume
of this section applies separately to each fuel subject to the 500 ppm sulfur limit in paragraph (a)(3) of this section
facility as defined under § 80.502 where content standard must be designated by shall be subject to the 15 ppm sulfur
there is custody of the fuel when it is the refiner or importer as subject to such content standard. However, for any
downgraded. standard, pursuant to § 80.598(a). compliance period prior to the
(3) Compliance with the limitation of (2) The refiner or importer must meet compliance period July 1, 2009 through
paragraph (c)(1) of this section applies the requirements for product transfer May 31, 2010, a refiner or importer may
separately for the compliance periods of documents in § 80.590 for each batch exceed the volume limit in paragraph
October 1, 2006 through May 31, 2007; subject to the 500 ppm sulfur content (a)(3) of this section by no more than 5
June 1, 2007 through June 30, 2008; July standard. percent of the volume of diesel fuel
1, 2008 through June 30, 2009; July 1, (3)(i) The volume of motor vehicle produced or imported during the
2009 through May 31, 2010. diesel fuel that is produced or imported compliance period (Vt), provided that
for the immediately following a sulfur content less than or equal to 500 volume limit of § 80.530(a)(3) provided
compliance period: ppm. that:
(i) The refiner or importer complies * * * * * (1) The motor vehicle diesel fuel
with the volume limit in paragraph (d) * * * credits were generated and reported
(a)(3) of this section; and (1) The designation requirements of according to the requirements of this
(ii) The refiner or importer produces § 80.598, and all recordkeeping and subpart; and
or imports a volume of motor vehicle reporting requirements of §§ 80.592, (2) The conditions of this section are
diesel fuel subject to the 15 ppm sulfur 80.593, 80.594, 80.600, and 80.601. met.
standard, or obtains credits properly * * * * * (b) Use of credits generated under
generated and used pursuant to the (5) In addition to the reporting § 80.531. Motor vehicle diesel fuel
requirements of §§ 80.531 and 80.532 requirements under paragraph (d)(1) of credits generated under § 80.531 may be
that represent a volume of motor vehicle this section, the refiner or importer must used by a refiner or by an importer to
diesel fuel, equal to the volume of the submit a report to the Administrator no comply with § 80.530 by applying one
exceedance for the prior compliance later than August 31, 2005 for the period credit for every gallon of motor vehicle
period. from June 1, 2004 through May 31, diesel fuel needed to meet compliance
(b) After May 31, 2010, no refiner or 2005, or August 31, 2006 for the period with the volume limit of § 80.530(a)(3).
importer may produce or import motor Ä from June 1, 2005 through May 31, (c) Credit banking. Motor vehicle
vehicle diesel fuel subject to the 500 Ä 2006, demonstrating that all the motor diesel fuel credits generated may be
ppm sulfur content standard pursuant to Ä vehicle diesel fuel produced or banked for use or transfer in a later
this section.Ä imported for which credits were compliance period or may be transferred
■ 23. Section 80.531 is amended by Ä generated met the applicable to another refiner or importer for use as
revising paragraphs (a)(1), (a)(2), (d)(1) Ä requirements of paragraph (b), (c), or provided in paragraph (d) of this
(d)(5), (e)(1), and (e)(2)(i) to read as Ä (d)(4) of this section. If the section.
follows:Ä Administrator finds that such credits (d) Credit transfers. (1) Motor vehicle
did not in fact meet the requirements of diesel fuel credits obtained from another
§ 80.531 How are motor vehicle diesel fuel refiner or from another importer,
credits generated? paragraphs (b)(1) and (c)(1) of this
section, as applicable, or if the including early motor vehicle diesel fuel
(a) * * * credits and small refiner motor vehicle
(1) A refiner or importer may generate Administrator determines that there is
insufficient information to determine diesel fuel credits as described in
credits during the period June 1, 2006 § 80.531(b) through (e), may be used to
through December 31, 2009, for motor the validity of such credits, the
Administrator may deny the credits satisfy the volume limit of § 80.530(a)(3)
vehicle diesel fuel produced or if all the following conditions are met:
imported that is designated as subject to submitted in whole or in part.
(e) * * * (i) The motor vehicle diesel fuel
the 15 ppm sulfur content standard (1) Notwithstanding the provisions of credits were generated in the same CTA
under § 80.520(a)(1). Credits may be paragraph (a) of this section, a small as the CTA in which motor vehicle
generated only if the volume of motor refiner that is approved by the EPA as diesel fuel credits are used to achieve
vehicle diesel fuel designated under a small refiner under § 80.551(g) may compliance;
§ 80.598(a) as subject to the 15 ppm generate credits under § 80.552(b). Such (ii) The motor vehicle diesel fuel
sulfur standard of § 80.520(a) exceeds 80 a small refiner may generate one credit credits are used in compliance with the
percent of the total volume of motor for each gallon of motor vehicle diesel time period limitations for credit use in
vehicle diesel fuel produced or fuel produced that is designated under this subpart;
imported as described in paragraph § 80.598 as motor vehicle diesel fuel (iii) Any credit transfer takes place no
(a)(2) of this section. subject to the 15 ppm sulfur standard later than the August 31 following the
(2) The number of motor vehicle compliance period when the motor
under § 80.520(a)(1).
diesel fuel credits generated shall be (2) * * * vehicle diesel fuel credits are used;
calculated for each compliance period (i) Credits may be generated under (iv) No credit may be transferred more
(as specified in § 80.530(a)(5)) as this paragraph (e) and § 80.552(b) only than twice, as follows: The first transfer
follows: during the compliance periods Ä by the refiner or importer who generated
C = V1515¥(0.80 × Vt) Ä beginning June 1, 2006 and ending on Ä the credit may only be made to a refiner
Where: Ä May 31, 2010, however diesel fuel Ä or importer who intends to use the
C = the positive number of motor vehicle Ä produced after December 31, 2009 shall Ä credit; if the transferee cannot use the
diesel fuel credits generated, in gallons. not generate credits. Credits shall be Ä credit, it may make a second and final
V15 = the total volume in gallons of diesel transfer only to a refiner or importer
fuel produced or imported that is
designated separately by refinery, Ä
designated under § 80.598 as motor separately by CTA of generation, and Ä who intends to use the credit. In no case
vehicle diesel fuel and subject to the separately by annual compliance period. Ä may a credit be transferred more than
standards of § 80.520(a) during the The annual compliance period for 2006 Ä twice before being used or terminated;
compliance period. shall be June 1, 2006 through June 30, Ä (v) The credit transferor must apply
Vt n =15 + V500. 2007. The annual compliance period for Ä any motor vehicle diesel fuel credits
V500 = the total volume in gallons of diesel 2010 shall be July 1, 2009 through May Ä necessary to meet the transferor’s
fuel produced or imported that is 31, 2010.Ä annual compliance requirements before
designated under § 80.598(a) as motor transferring motor vehicle diesel fuel
vehicle diesel fuel and subject to the 500 * * * * *Ä
■ 24. Section 80.532 is revised to read as Ä credits to any other refinery or importer;
ppm sulfur standard under § 80.520(c) (vi) No motor vehicle diesel fuel
plus the total volume of any other diesel follows:Ä
fuel (not including V15, diesel fuel that
credits may be transferred that would
is dyed in accordance with § 80.520(b) at
§ 80.532 How are motor vehicle diesel fuel result in the transferor having a negative
credits used and transferred? credit balance; and
the refinery or import facility where the
diesel fuel is produced or imported, or (a) Credit use stipulations. Motor (vii) Each transferor must supply to
diesel fuel that is designated as NRLM vehicle diesel fuel credits generated the transferee records indicating the
under § 80.598(a)) represented as having under § 80.531 may be used to meet the year the motor vehicle diesel fuel
credits were generated, the identity of section by the dates specified in (6) Other appropriate information as
the refiner (and refinery) or importer paragraph (f) of this section. A refiner requested by EPA.
who generated the motor vehicle diesel must apply for a motor vehicle baseline (d) Calculation of the Motor vehicle
fuel credits, the CTA of credit for each refinery in order to generate Baseline, BMV. (1) Under paragraph
generation, and the identity of the credits under § 80.535 and apply for a (c)(2)(i) of this section, BMV equals the
transferring entity, if it is not the same non-highway baseline for each refinery average annual volume of motor vehicle
entity who generated the motor vehicle to use the provisions of § 80.554 (a), (b), diesel fuel produced or imported from
diesel fuel credits. or (d). January 1, 2003 through December 31,
(2) In the case of motor vehicle diesel (b) The baseline must be sent to the 2005.
fuel credits that have been calculated or following address: U.S. EPA—Attn: (2) Under paragraph (c)(2)(ii) of this
created improperly, or are otherwise Nonroad Rule Diesel Fuel Baseline, section, BMV equals the average annual
determined to be invalid, the following Transportation and Regional Programs volume of motor vehicle diesel fuel
provisions apply: Division (6406J), 1200 Pennsylvania produced during the period from
(i) Invalid motor vehicle diesel fuel Avenue, NW., Washington, DC 20460 January 1, 2006 through December 31,
credits cannot be used to achieve (regular mail) or U.S. EPA, Attn: 2008.
compliance with the transferee’s volume Nonroad Rule Diesel Fuel Baseline, (3) For purposes of this paragraph,
requirements regardless of the Transportation and Regional Programs fuel produced for export, jet fuel
transferee’s good faith belief that the Division (6406J), 1310 L Street, NW., 6th (kerosene), and fuel specifically
motor vehicle diesel fuel credits were floor, Washington, DC 20005 (express produced to meet military specifications
valid. mail). (such as JP–4, JP–8, and F–76), shall not
(ii) The refiner or importer who used (c) A baseline application must be be included in baseline calculations.
the motor vehicle diesel fuel credits, submitted for each refinery or import (e) Calculation of the Non-highway
and any transferor of the motor vehicle facility and include the following Baseline, BNRLM. (1) Under paragraph
diesel fuel credits, must adjust their information: (c)(2)(i) of this section, BNRLM equals the
credit records, reports and compliance (1) A listing of the names and average annual volume of all #2D
calculations as necessary to reflect the addresses of all refineries or import distillate produced or imported from
proper motor vehicle diesel fuel credits. facilities owned by the company for January 1, 2003 through December 31,
(iii) Any properly created motor which the refiner or importer is 2005, less BMV as determined in
vehicle diesel fuel credits existing in the applying for a motor vehicle or non- paragraph (d)(1) of this section.
transferor’s credit balance after highway baseline. (2) Under paragraph (c)(2)(ii) of this
correcting the credit balance, and after (2)(i) For purposes of a motor vehicle section, NRLM equals the average annual
the transferor applies motor vehicle baseline volume for use in determining volume of MVNRLM produced or
diesel fuel credits as needed to meet the early credits per § 80.535(a) and (b) and imported from January 1, 2006 through
compliance requirements at the end of for purposes of a non-highway baseline December 31, 2008, less BMV as
the compliance period, must first be volume used in determining compliance determined in paragraph (d)(2) of this
applied to correct the invalid transfers with the provisions of § 80.554(a) or (d), section.
before the transferor trades or banks the the baseline volume produced during (3) For purposes of this paragraph (e),
motor vehicle diesel fuel credits. the three calendar years beginning fuel produced for export, jet fuel,
(e) Limitations on credit use. (1) January 1, 2003, 2004, and 2005, as kerosene, and fuel specifically produced
Motor vehicle diesel fuel credits may calculated under paragraph (e)(1) of this to meet military specification (such as
not be used to achieve compliance with section. JP–4, JP–8, and F–76), shall not be
any requirements of this subpart other (ii) For purposes of a motor vehicle included in baseline calculations.
than the volume limit of § 80.530(a)(3), baseline volume for use in determining (f)(1) Applications submitted under
unless specifically approved by the early credits per § 80.535(c) and for paragraph (c)(2)(i) of this section must
Administrator pursuant to a hardship purposes of a non-highway baseline be postmarked by February 28, 2006.
relief petition under § 80.560 or 80.561. volume used in determining compliance (2) Applications submitted under
(2) A refiner or importer possessing with the provisions of § 80.554(b), the paragraph (c)(2)(ii) of this section must
motor vehicle diesel fuel credits must baseline volumes produced during the be postmarked by February 28, 2009.
use all motor vehicle diesel fuel credits three calendar years beginning January (g)(1) For applications submitted
in its possession prior to applying the 1, 2006, 2007, and 2008, as calculated under paragraph (c)(2)(i) of this section,
credit deficit provisions of under paragraph (e)(2) of this section. EPA will notify refiners or importers by
§ 80.530(a)(6). (3) A letter signed by the president, June 1, 2006 of approval of the baselines
(3) No motor vehicle diesel fuel chief operating officer of the company, for each of the refiner’s refineries or
credits may be used to meet compliance or his/her delegate, stating that the importer’s import facilities or of any
with this subpart subsequent to the information contained in the motor deficiencies in the refiner’s or
compliance period ending May 31, vehicle or non-highway baseline importer’s application.
2010. application is true to the best of his/her (2) For applications submitted under
■ 25. A new § 80.533 is added to read as knowledge. paragraph (c)(2)(ii) of this section, EPA
follows: (4) Name, address, phone number, will notify refiners or importers by June
facsimile number and e-mail address of 1, 2009 regarding approval of the
§ 80.533 How does a refiner or importer a corporate contact person. baselines for each of the refiner’s
apply for a motor vehicle or non-highway (5) For each batch of diesel fuel refineries or importer’s import facilities
baseline? produced or imported during each of any deficiencies in the refiner’s or
(a) A refiner or importer wishing to calendar year: importer’s application.
generate credits under § 80.535 or use (i) The date that production was (h) If at any time the motor vehicle
the small refiner provisions under completed or importation occurred for baseline or non-highway baseline
§ 80.554 must submit an application to the batch and the batch designation or submitted in accordance with the
EPA that includes the information classification. requirements of this section is
required under paragraph (c) of this (ii) The batch volume. determined to be incorrect, EPA will
notify the refiner or importer of the Ä importer for the same motor vehicle did not in fact meet the requirements of
corrected baseline and any compliance Ä diesel fuel. paragraphs (a)(1) through (a)(5) of this
calculations made on the basis of that Ä (iii) Credits shall not be generated section, as applicable, or if the
baseline will have to be adjusted Ä under both § 80.531 and this section for Administrator determines that there is
retroactively.Ä the same diesel fuel. insufficient information to determine
■ 26. A new § 80.535 is added to read as Ä (iv) Any credits generated by a foreign the validity of such credits, the
follows.Ä refiner shall be generated as provided in Administrator may deny the credits
§ 80.620(c) and this section. submitted in whole or in part.
§ 80.535 How are NRLM diesel fuel credits (4) No credits may be generated under (3) In addition, a foreign refiner that
generated? this paragraph (a) after May 31, 2007. is approved by the Administrator to
(a) Generation of high sulfur NRLM (5) Any fuel for which a refiner or generate credits under § 80.554 shall
credits from June 1, 2006 through May importer wishes to generate credits must comply with the requirements of
31, 2007. (1) During the period June 1, be designated as 500 ppm sulfur NRLM § 80.620.
2006 through May 31, 2007, a refiner or diesel fuel when delivered to the next (c) Generation of 500 ppm sulfur
importer may generate credits pursuant entity. The refiner may not designate the NRLM credits from June 1, 2009 through
to the provisions of this section if all of fuel as 500 ppm sulfur with the intent May 31, 2010. (1) During the period of
the following conditions are met: that it be mixed by the next entity with June 1, 2009 through May 31, 2010, a
(i) The refiner or importer notifies a batch of distillate with a higher sulfur refiner or importer may generate credits
EPA of its intention to generate credits level to create a fuel with a pursuant to the provisions of this
and the period during which it will classification other than 500 ppm sulfur section if all of the following conditions
generate credits. This notification must or the classification of the fuel it is are met:
be received by EPA at least 120 calendar mixed with (e.g., it cannot mix fuel (i) The refiner or importer notifies
days prior to the date it begins designated as 500 ppm sulfur with fuel EPA of its intention to generate credits
generating credits under this section. classified as high sulfur to produce a and the period during which it will
(ii) Each batch or partial batch of fuel classified as 2000 ppm sulfur to generate credits. This notification must
NRLM diesel fuel for which credits are meet state or local sulfur limits). be received by EPA at least 120 calendar
claimed shall be subject to all of the (6) The refiner or importer must days prior to the date it begins
provisions of this subpart for NRLM submit a report to the Administrator no generating credits under this section.
diesel fuel as if it had been produced later than July 31, 2007. The report must (ii) Each batch or partial batch of
after June 1, 2007 and before June 1, demonstrate that all the NRLM diesel NRLM diesel fuel for which credits are
2010. fuel produced or imported which claimed shall be subject to all of the
(iii) The number of high-sulfur NRLM generated credits met the applicable provisions of this subpart for NRLM
credits (HSC) that are generated shall be requirements of paragraphs (a)(1) diesel fuel as if it had been produced
a positive number. through (a)(5) of this section. If the after June 1, 2010.
(2) The refiner or importer shall Administrator finds that such credits (iii) The number of 500 ppm sulfur
choose one of the following methods for did not in fact meet the requirements of NRLM credits in gallons that are
calculating credits for each calculation paragraphs (a)(1) through (a)(5) of this generated, C500, shall be a positive
period. section, as applicable, or if the number calculated as follows:
(i) For fuel that is dyed under the Administrator determines that there is
provisions of § 80.520, HSC equals the insufficient information to determine C500 = V15¥BMV
Where: Ä
volume of fuel in gallons produced or the validity of such credits, the V15 = The total volume in gallons of 15 ppm Ä
imported during the period identified in Administrator may deny the credits diesel fuel produced or imported during
paragraph (a)(1) of this section that is submitted in whole or in part. the period stated under paragraph
designated as NRLM diesel fuel and that (b) Generation of high-sulfur NRLM (c)(1)(i) of this section that is designated
is subject to and complies with the credits by small refiners from June 1, as either motor vehicle diesel fuel or
provisions of § 80.510(a); or 2006 through May 31, 2010. (1) NRLM diesel fuel.
(ii) For dyed or undyed fuel that Notwithstanding the dates specified in BMV = As determined in § 80.533(d)(2).
complies with the provisions of § 80.598 paragraph (a) of this section, during the (2) 500 ppm sulfur NRLM credits
for a calculation period of June 1, 2006 period from June 1, 2006 through May shall be generated and designated as
through May 31, 2007, determine HSC 31, 2010, a refiner that is approved by follows:
as follows: the EPA as a small refiner under (i) Credits shall be generated
HSC = V510 + V520 ¥ BMV § 80.551 may generate credits under separately for each refiner or importer.
Where:
paragraph (a) of this section during any (ii) Credits may not be generated by
compliance period as specified under both a foreign refiner and by an
V510 = The total volume of NRLM diesel fuel
produced or imported during the annual
§ 80.599(a)(2) for diesel fuel produced or importer for the same diesel fuel.
calculation period that complies with the imported that is designated as NRLM (iii) Credits shall not be generated
standards of § 80.510(a) or (b). diesel fuel and complies with the under both § 80.531 and this section for
V520 = The total volume of motor vehicle provisions of § 80.510(a). the same diesel fuel.
diesel fuel produced or imported during (2) The small refiner must submit a (iv) Any credits generated by a foreign
the annual calculation period that report to the Administrator no later than refiner shall be generated as provided in
complies with the standards of August 31 after the end of each § 80.620(c) and this section.
§ 80.520(a) or (c). calculation period during which credits (3) No credits may be generated under
BMV = As calculated in § 80.533(d)(1). were generated. The report must this paragraph (c) after May 31, 2010.
(3) High-sulfur NRLM credits shall be demonstrate that all the NRLM diesel (4) The refiner or importer must
generated and designated as follows: fuel produced or imported which submit a report to the Administrator no
(i) Credits shall be generated generated credits met the applicable later than August 31, 2010. The report
separately for each refiner or importer. requirements of paragraphs (a)(1) must demonstrate that all the 15 ppm
(ii) Credits may not be generated by through (a)(5) of this section. If the sulfur NRLM diesel fuel produced or
both a foreign refiner and by an Administrator finds that such credits imported which generated credits met
the applicable requirements of (1) The credits were generated and regardless of the transferee’s good faith
paragraphs (c)(1) through (c)(3) of this reported according to the requirements belief that the credits were valid.
section. If the Administrator finds that of this subpart; and (ii) The refiner or importer that used
such credits did not in fact meet the (2) The conditions of this section are the credits, and any transferor of the
requirements of paragraphs (c)(1) met. credits, must adjust its credit records,
through (c)(3) of this section, as (b) Using credits generated under reports and compliance calculations as
applicable, or if the Administrator § 80.535. Credits generated under necessary to reflect the proper credits.
determines that there is insufficient § 80.535 may be used by a refiner or an (iii) Any properly created credits
information to determine the validity of importer to comply with the diesel fuel existing in the transferor’s credit
such credits, the Administrator may standards of § 80.510 (a), (b), and (c) by balance after correcting the credit
deny the credits submitted in whole or applying one credit for every gallon of balance, and after the transferor applies
in part. diesel fuel that does not comply with credits as needed to meet the
the applicable standard. compliance requirements at the end of
(d) Generation of 500 ppm sulfur
(c) Credit banking. Credits generated the calendar year, must first be applied
NRLM credits by small refiners from
may be banked for use at a later time or to correct the invalid transfers before the
June 1, 2009 through December 31,
may be transferred to any other refiner transferor trades or banks the credits.
2013. (1) Notwithstanding the dates
or importer nationwide for use as (e) General limitation on credit use.
specified in paragraph (c) of this
provided in paragraph (d) of this Credits may not be used to achieve
section, during the period from June 1,
section. compliance with any requirements of
2009 through December 31, 2013, a
(d) Credit transfers. (1) Credits this subpart other than the standards of
refiner that is approved by the EPA as
generated under § 80.535 that are § 80.510(a), (b), and (c), unless
a small refiner under § 80.551 may
obtained from another refiner or specifically approved by the
generate credits under paragraph (c) of
importer may be used to comply with Administrator pursuant to a hardship
this section during any compliance
the diesel fuel sulfur standards of relief petition under § 80.560 or
period as specified under § 80.599(a)(2)
§ 80.510(a), (b), and (c) if all the § 80.561.
for diesel fuel produced or imported (f) Use of high sulfur NRLM credits.
following conditions are met:
that is designated as NR or NRLM diesel (i) The credits are used in compliance (1) High sulfur NRLM credits generated
fuel and complies with the provisions of with the time period limitations for under § 80.535(a) or (b) may be used on
§ 80.510(b) or (c). credit use in this subpart; a one-for-one basis to meet the NRLM
(2) The small refiner must submit a (ii) Any credit transfer is completed diesel fuel sulfur standard of § 80.510(a)
report to the Administrator no later than no later than August 31 following the from June 1, 2007 through May 31,
August 31 after the end of each compliance period when the credits are 2010. For example, one credit generated
calculation period during which credits used to comply with a standard under by the production or importation of one
were generated. The report must paragraph (a) of this section; gallon of NRLM diesel fuel subject to
demonstrate that all the 15 ppm sulfur (iii) No credit is transferred more than the NRLM diesel fuel sulfur standard of
NR or NRLM diesel fuel produced or twice, as follows: § 80.510 (a) may be used to produce or
imported for which credits were (A) The first transfer by the refiner or import one gallon of NRLM diesel fuel
generated met the applicable importer who generated the credit may that is exempt from the sulfur standard
requirements of paragraphs (c)(1) only be made to a refiner or importer of § 80.510(a) during the period from
through (c)(3) of this section. If the that intends to use the credit; if the June 1, 2007 through May 31, 2010.
Administrator finds that such credits transferee cannot use the credit, it may (2) Any high sulfur NRLM diesel fuel
did not in fact meet the requirements of make a second and final transfer only to produced after June 1, 2007 through the
paragraphs (c)(1) through (c)(3) of this a refiner or importer who intends to use use of credits must—
section, as applicable, or if the the credit; and (i) Be dyed red under the provisions
Administrator determines that there is (B) In no case may a credit be of § 80.520 at the point of production or
insufficient information to determine transferred more than twice before it is importation;
the validity of such credits, the used or it expires; (ii) Be associated with a product
Administrator may deny the credits (iv) The credit transferor applies any transfer document that bears a unique
submitted in whole or in part. credits necessary to meet the transferor’s product code as specified in § 80.590;
annual compliance requirements before and
(3) In addition, a foreign refiner that
transferring credits to any other refinery (iii) Not be used to sell or deliver
is approved by the Administrator to
or importer; diesel fuel into areas specified in
generate credits under § 80.554 shall (v) No credits are transferred that § 80.510(g)(1) or (g)(2).
comply with the requirements of would result in the transferor having a (3) No high sulfur NRLM credits may
§ 80.620. negative credit balance; and be used subsequent to the compliance
■ 27. A new § 80.536 is added to read as (vi) Each transferor supplies to the period ending May 31, 2010.
follows: transferee records indicating the year (4) Any high sulfur NRLM credits not
the credits were generated, the identity used under the provisions of paragraph
§ 80.536 How are NRLM diesel fuel credits
used and transferred?
of the refiner (and refinery) or importer (f)(1) of this section may be converted
that generated the credits, and the into 500 ppm sulfur NRLM credits on a
(a) Credit use stipulations. Credits identity of the transferor, if it is not the one-for-one basis for use under
generated under § 80.535(a) and (b) may same party that generated the credits. paragraph (g) of this section.
be used to meet the NRLM diesel fuel (2) In the case of credits that have (g) Use of 500 ppm sulfur NRLM
sulfur standard of § 80.510(a), and been calculated or created improperly, credits. (1) 500 ppm sulfur NRLM
credits generated under 80.535(c) and or are otherwise determined to be credits generated under § 80.535(c) or
(d) may be used to meet the NR and invalid, the following provisions apply: (d) or converted from high sulfur NRLM
NRLM diesel fuel sulfur standard of (i) Invalid credits cannot be used to credits under paragraph (f)(3) of this
80.510(b) and (c), respectively, provided achieve compliance with the section may be used on a one-for-one
that: transferee’s volume requirements basis to meet the NR or NRLM diesel
fuel sulfur standards of § 80.510(b) or (c) (f) Compliance with the volume Corporation organized pursuant to the
from June 1, 2010 through May 31, requirements in paragraph (e) of this Alaska Native Claims Settlement Act (43
2014. For example, one credit generated section shall be determined each U.S.C. 1601) is not considered an
by the production or importation of one compliance period. Annual compliance affiliate of such entity, or with other
gallon of NRLM diesel fuel subject to periods shall be from July 1 through concerns owned by such entity solely
the NRLM diesel fuel sulfur standard of June 30. For the year 2006, the because of their common ownership.
§ 80.510 (c) may be used to produce or compliance period shall be from June 1, (d)(1) Notwithstanding the provisions
import one gallon of NR diesel fuel that 2006 through June 30, 2007. of paragraph (a) of this section, a refiner
is subject to the sulfur standard of * * * * *Ä that acquires or reactivates a refinery
§ 80.510(a) during the period from June ■ 29. Section 80.550 is amended by Ä that was shut down or non-operational
1, 2010 through May 31, 2014. revising the section heading and Ä between January 1, 1999, and January 1,
(2) Any 500 ppm sulfur NR or NRLM paragraphs (a), (b), (c), (d), (e) and (f) to Ä 2000, may apply for motor vehicle
diesel fuel produced or imported after read as follows:Ä diesel fuel small refiner status in
June 1, 2010 through the use of these accordance with the provisions of
§ 80.550 What is the definition of a motor
credits must— § 80.551(c)(1)(ii).
vehicle diesel fuel small refiner or a NRLM
(i) Bear a unique product code as diesel fuel small refiner under this subpart? (2) Notwithstanding the provisions of
specified in § 80.590; and (a) A motor vehicle diesel fuel small paragraph (b) of this section, a refiner
(ii) Not be used to sell or deliver refiner is defined as any person, as that acquires or reactivates a refinery
diesel fuel into areas specified in defined by 42 U.S.C. 7602(e), who— that was shutdown or non-operational
§ 80.510(g)(1) or (g)(2). (1) Produces diesel fuel at a refinery between January 1, 2002, and January 1,
(3) No 500 ppm sulfur NRLM credits by processing crude oil through refinery 2003, may apply for NRLM diesel fuel
may be used after May 31, 2014. processing units; and small refiner status in accordance with
■ 28. Section 80.540 is amended by (2) Employed an average of no more the provisions of § 80.551(c)(2)(ii).
revising paragraphs (b), (d), (e), and (f) to than 1,500 people, based on the average (e) The following are ineligible for the
read as follows: number of employees for all pay periods small refiner provisions:
from January 1, 1999, to January 1, 2000; (1)(i) For motor vehicle diesel fuel,
§ 80.540 How may a refiner be approved to and refiners with refineries built or started
produce gasoline under the GPA gasoline up after January 1, 2000.
(3) Had an average crude oil capacity
sulfur standards in 2007 and 2008?
less than or equal to 155,000 barrels per (ii) For NRLM diesel fuel, refiners
* * * * * calendar day (bpcd) for 1999; or with refineries built or started up after
(b) The refiner must submit an (4) Has been approved by EPA as a January 1, 2003.
application in accordance with the small refiner under § 80.235 and (2)(i) For motor vehicle diesel fuel,
provisions of §§ 80.595 and 80.596. The continues to meet the criteria of a small persons who exceed the employee or
application must also include refiner under § 80.225. crude oil capacity criteria under this
information, as provided in § 80.594(c), (b) A NRLM diesel fuel small refiner section on January 1, 2000, but who
demonstrating that starting no later than is defined as any person, as defined by meet these criteria after that date,
June 1, 2006, 95 percent of the motor 42 U.S.C. 7602(e), who— regardless of whether the reduction in
vehicle diesel fuel produced by the (1) Produces diesel fuel at a refinery employees or crude oil capacity is due
refinery for United States use will by processing crude oil through refinery to operational changes at the refinery or
comply with the 15 ppm sulfur standard processing units; a company sale or reorganization.
under § 80.520(a)(1), and that the (2) Employed an average of no more (ii) For NRLM diesel fuel, persons
volume of motor vehicle diesel fuel than 1,500 people, based on the average who exceed the employee or crude oil
produced will comply with the volume number of employees for all pay periods capacity criteria under this section on
requirements of paragraph (e) of this from January 1, 2002, to January 1, 2003; January 1, 2003, but who meet these
section. and criteria after that date, regardless of
(3) Had an average crude oil capacity
* * * * * whether the reduction in employees or
less than or equal to 155,000 barrels per
(d) From June 1, 2006 through crude oil capacity is due to operational
calendar day (bpcd) for 2003.
December 31, 2008, 95 percent of the (c) Determine the number of changes at the refinery or a company
motor vehicle diesel fuel produced by a employees and crude oil capacity under sale or reorganization.
refiner that has been approved under paragraphs (a) or (b) of this section, as (3) Importers.
paragraph (c) of this section to produce follows: (4) Refiners who produce motor
gasoline subject to the GPA gasoline (1) The refiner shall include the vehicle diesel fuel or NRLM diesel fuel
sulfur standards in 2007 and 2008, must employees and crude oil capacity of any other than by processing crude oil
be accurately designated under § 80.598 subsidiary companies, any parent through refinery processing units.
as meeting the 15 ppm sulfur standard company and subsidiaries of the parent (f)(1)(i) Refiners who qualify as motor
of § 80.520(a)(1). company in which the parent has 50 vehicle diesel fuel small refiners under
(e) The total volume of motor vehicle percent or greater ownership, and any this section and subsequently cease
diesel fuel produced for use in the joint venture partners. production of diesel fuel from
United States and designated as meeting (2) For any refiner owned by a processing crude oil through refinery
the 15 ppm sulfur standard under governmental entity, the number of processing units, or employ more than
paragraph (d) of this section must meet employees and total crude oil capacity 1,500 people or exceed the 155,000
or exceed 85 percent of the baseline as specified in paragraph (a) of this bpcd crude oil capacity limit after
volume established under paragraph (c) section shall include all employees and January 1, 2004 as a result of merger
of this section, except that for the first crude oil production of the government with or acquisition of or by another
compliance period from June 1, 2006 to which the governmental entity is a entity, are disqualified as small refiners,
through June 30, 2007, the total volume part. except as provided for under paragraph
must meet or exceed 92 percent of the (3) Any refiner owned and controlled (f)(4) of this section. If disqualification
baseline volume. by an Alaska Regional or Village occurs, the refiner shall notify EPA in
writing no later than 20 days following this section, and any extension provided Ä between January 1, 1999, and January 1,
this disqualifying event. under paragraph (f)(3) of this section, Ä 2000, a listing of the name and address
(ii) Except as provided under the refiner may not generate NRLM Ä of each location where any employee of
paragraph (f)(3) of this section, any diesel fuel sulfur credits under Ä the refiner worked since the refiner
refiner whose status changes under this § 80.535(b) or (d).Ä acquired or reactivated the refinery; the
paragraph shall meet the applicable * * * * *Ä average number of employees at any
standards of § 80.520 within a period of ■ 30. Section 80.551 is revised to read as Ä such acquired or reactivated refinery
up to 30 months from the disqualifying follows:Ä during each calendar year since the
event for any of its refineries that were refiner acquired or reactivated the
previously subject to the small refiner § 80.551 How does a refiner obtain refinery; and the type of business
standards of § 80.552, but no later than approval as a small refiner under this activities carried out at each location.
the May 31, 2010. subpart? (2) For NRLM diesel fuel small
(2)(i) Refiners who qualify as NRLM (a)(1)(i) Applications for motor refiners—
diesel fuel small refiners under this vehicle diesel fuel small refiner status (i) A listing of the name and address
section and subsequently cease must be submitted to EPA by December of each location where any employee
production of diesel fuel from crude oil, 31, 2001. worked during the 12 months preceding
or employ more than 1,500 people or (ii) Applications for NRLM diesel fuel January 1, 2003; the average number of
exceed the 155,000 bpcd crude oil small refiner status must be submitted employees at each location based upon
capacity limit after January 1, 2004 as a to EPA by December 31, 2004. the number of employees for each pay
result of merger with or acquisition of (2)(i) In the case of a refiner who period for the 12 months preceding
or by another entity, are disqualified as acquires or reactivates a refinery that January 1, 2003; and the type of
small refiners, except as provided for was shutdown or non-operational business activities carried out at each
under paragraph (f)(4) of this section. If between January 1, 1999, and January 1, location; or
disqualification occurs, the refiner shall 2000, the application for motor vehicle (ii) In the case of a refiner who
notify EPA in writing no later than 20 diesel fuel small refiner status must be acquires or reactivates a refinery that
days following this disqualifying event. submitted to EPA by June 1, 2003. was shutdown or non-operational
(ii) Except as provided under (ii) In the case of a refiner who between January 1, 2002, and January 1,
paragraph (f)(3) of this section, any acquires or reactivates a refinery that 2003, a listing of the name and address
refiner whose status changes under this was shutdown or non-operational of each location where any employee of
paragraph shall meet the applicable between January 1, 2002, and January 1, the refiner worked since the refiner
standards of § 80.510 within a period of 2003, the application for NRLM diesel acquired or reactivated the refinery; the
up to 30 months of the disqualifying fuel small refiner status must be average number of employees at any
event for any of its refineries that were submitted to EPA by June 1, 2006. such acquired or reactivated refinery
previously subject to the small refiner (b) Applications for small refiner during each calendar year since the
standards of § 80.552, but no later than status must be sent via certified mail refiner acquired or reactivated the
the dates specified in § 80.554(a) or (b), with return receipt or express mail with refinery; and the type of business
as applicable. return receipt to: U.S. EPA—Attn: Diesel activities carried out at each location.
(3) A refiner may apply to EPA for up Small Refiner Status (6406J), 1200 (3) The total corporate crude oil
to an additional six months to comply Pennsylvania Avenue, NW., capacity of each refinery as reported to
with the standards of § 80.510 or Washington, DC 20460 (certified mail/ the Energy Information Administration
§ 80.520 if more than 30 months would return receipt) or Attn: Diesel Small (EIA) of the U.S. Department of Energy
be required for the necessary Refiner Status, Transportation and (DOE) for the most recent 12 months of
engineering, permitting, construction, Regional Programs Division, 1310 L operation. The information submitted to
and start-up work to be completed. Such Street, NW., 6th floor, Washington, DC EIA is presumed to be correct. In cases
applications must include detailed 20005 (express mail/return receipt). where a company disagrees with this
technical information supporting the (c) The small refiner status information, the company may petition
need for additional time. EPA will base application must contain the following EPA with appropriate data to correct the
a decision to approve additional time on information for the company seeking record when the company submits its
information provided by the refiner and small refiner status, plus any subsidiary application for small refiner status. EPA
on other relevant information. In no companies, any parent company and may accept such alternate data at its
case will EPA extend the compliance subsidiaries of the parent company in discretion.
date beyond May 31, 2010 for a motor which the parent has 50 percent or (4) For motor vehicle diesel fuel, an
vehicle diesel fuel small refiner or greater ownership, and any joint venture indication of whether the refiner, for
beyond the dates specified in § 80.554(a) partners: each refinery, is applying for—
or (b), as applicable, for a NRLM diesel (1) For motor vehicle diesel fuel small (i) The ability to produce motor
fuel small refiner. refiners— vehicle diesel fuel subject to the 500
(4) Disqualification under paragraphs (i) A listing of the name and address ppm sulfur standard under § 80.520(c)
(f)(1) or (f)(2) of this section shall not of each location where any employee or generate credits under § 80.531,
apply in the case of a merger between worked during the 12 months preceding pursuant to the provisions of § 80.552(a)
two previously approved small refiners. January 1, 2000; the average number of or (b); or
(5) During the period of time up to 30 employees at each location based upon (ii) An extension of the duration of its
months provided under paragraph the number of employees for each pay small refiner gasoline sulfur standard
(f)(1)(ii) of this section, and any period for the 12 months preceding under § 80.553, pursuant to the
extension provided under paragraph January 1, 2000; and the type of provisions of § 80.552(c).
(f)(3) of this section, the refiner may not business activities carried out at each (5) For NRLM diesel fuel, an
generate motor vehicle diesel fuel sulfur location; or indication of whether the refiner, for
credits under § 80.531(e). During the (ii) In the case of a refiner who each refinery, is applying for—
period of time up to 30 months acquires or reactivates a refinery that (i) The ability to delay compliance
provided under paragraph (f)(2)(ii) of was shutdown or non-operational under § 80.554(a) or (b), or to generate
NRLM diesel sulfur credits under compliance period that exceeds 105 be from July 1, 2009 through May 31,
§ 80.535(b) or (d), pursuant to the percent of the baseline volume 2010.
provisions of § 80.554(c); or established under § 80.595 (V500). The * * * * *
(ii) An adjustment to its small refiner annual compliance period shall be from (k) A refiner may petition the
gasoline sulfur standards under July 1 through June 30. For the year Administrator to vacate an extension of Ä
§ 80.240(a), pursuant to the provisions 2006, the compliance period shall be the small refiner gasoline sulfur content Ä
of § 80.554(d). from June 1, 2006 through June 30, standards. EPA may grant such a Ä
(6) A letter signed by the president, 2007, and the volume limits shall only petition, effective July 1 of the Ä
chief operating or chief executive officer apply to that volume V500 that exceeds compliance period following receipt of Ä
of the company, or his/her designee, 113 percent of the baseline volume. such petition (or effective June 1, 2006, Ä
stating that the information contained in (b) A refiner that has been approved if applicable). Upon such effective date, Ä
the application is true to the best of his/ by EPA as a motor vehicle diesel fuel all gasoline produced by the refiner Ä
her knowledge. small refiner under § 80.551(g) may must meet the gasoline sulfur content Ä
(7) Name, address, phone number, generate motor vehicle diesel fuel standards under subpart H of this part Ä
facsimile number and e-mail address (if credits pursuant to the provisions of as if there had been no extension of the Ä
available) of a corporate contact person. § 80.531, except that for purposes of small refiner gasoline sulfur content Ä
(d) For joint ventures, the total § 80.531(a), the term ‘‘Credit’’ shall standards under this section. Upon such Ä
number of employees includes the equal V15, without further adjustment. effective date, the refiner shall not be Ä
combined employee count of all (c) A refiner that has been approved subject to the requirements of this Ä
corporate entities in the venture. by EPA as a motor vehicle diesel fuel section.Ä
(e) For government-owned refiners, small refiner under § 80.551(g) may * * * * *Ä
the total employee count includes all apply for an extension of the duration ■ 33. A new § 80.554 is added to read as Ä
government employees. of its small refiner gasoline sulfur follows:Ä
(f) Approval of small refiner status for standards pursuant to § 80.553.
refiners who apply under § 80.550(e) § 80.554 What compliance options are
will be based on all information * * * * * available to NRLM diesel fuel small
submitted under paragraph (c) of this (e) The provisions of this section shall refiners?
section, except as provided in apply separately for each refinery (a) Option 1: A refiner that has been
§ 80.550(e). owned or operated by a motor vehicle approved by EPA as a NRLM diesel fuel
(g) EPA will notify a refiner of diesel fuel small refiner. small refiner under § 80.551(g) may
approval or disapproval of small refiner ■ 32. Section 80.553 is amended by produce NRLM diesel fuel from crude
status by letter. If disapproved, the revising paragraphs (d), (e), (f), and (k) to oil from June 1, 2007 through May 31,
refiner must comply with the sulfur read as follows: 2010, that is exempt from the standards
standards in § 80.510 or 80.520, as § 80.553 Under what conditions may the under § 80.510(a), but only for a refinery
appropriate, except as otherwise small refiner gasoline sulfur standards be located outside the areas specified
provided in this subpart. extended for a small refiner of motor under § 80.510(g)(1).
(h) If EPA finds that a refiner vehicle diesel fuel? (1) The volume of NRLM diesel fuel
provided false or inaccurate information * * * * * that is exempt from § 80.510(a) must be
on its application for small refiner (d) Beginning June 1, 2006, and less than or equal to 105 percent of
status, upon notice from EPA the continuing through December 31, 2010, BNRLM as defined under § 80.533, less
refiner’s small refiner status will be void all motor vehicle diesel fuel produced any volume of heating oil produced.
ab initio. (2) Any volume of NRLM diesel fuel
by a refiner that has received an
(i) Upon notification to EPA, an in excess of the volume allowed under
extension of its small refiner gasoline
approved small refiner may withdraw (a)(1) of this section will be subject to
sulfur standards under this section must
its status as a small refiner. Effective on the 500 ppm sulfur standard under
be accurately designated under § 80.598
January 1 of the year following such § 80.510(a).
as meeting the 15 ppm sulfur content
notification, the small refiner will (3) High-sulfur NRLM produced
standard under § 80.520(a)(1).
become subject to the sulfur standards under this paragraph must—
(e) The total volume of motor vehicle (i) Be dyed red pursuant to the
in § 80.510 or 80.520, as appropriate,
diesel fuel produced for use in the provisions of § 80.520 at the point of
unless one of the other hardship
United States and designated as meeting production or importation;
provisions of this subpart apply.
the 15 ppm sulfur content standard (ii) Be associated with a product
under paragraph (d) of this section must transfer document that bears a unique
revising the section heading and
meet or exceed 85 percent of the product code as specified under
paragraphs (a), (b), (c), and (e) to read as
baseline volume established under § 80.590; and
follows:
paragraph (c) of this section, except that (iii) Not be delivered into areas
§ 80.552 What compliance options are for the first compliance period from specified under § 80.510(g)(1).
available to motor vehicle diesel fuel small June 1, 2006 through June 30, 2007, the (4) From June 1, 2007 through May
refiners? total volume must meet or exceed 92 31, 2010, a refiner that has been
(a) A refiner that has been approved percent of the baseline volume. approved by EPA as a NRLM diesel fuel
by EPA as a motor vehicle diesel fuel (f) Compliance with the volume small refiner under § 80.551(g) may
small refiner under § 80.551(g) may requirements in paragraph (e) of this produce at a refinery located in
produce motor vehicle diesel fuel section shall be determined each 80.510(g)(2) NRLM diesel fuel that is
subject to the 500 ppm sulfur standard compliance period. Annual compliance exempt from the standards under
pursuant to the provisions of § 80.530, periods shall be from July 1 through § 80.510(a) only if the refiner first
except that the volume limits of June 30. For the year 2006, the obtains approval from the Administrator
§ 80.530(a)(3) shall only apply to that compliance period shall be from June 1, for a compliance plan. The compliance
volume of diesel fuel that is produced 2006 through June 30, 2007 and for the plan must detail how the refiner will
or imported during an annual year 2009 the compliance period shall segregate any fuel produced that does
not meet the standards under § 80.510(a) ultimate consumers to whom the refiner (e) Multiple refineries. The provisions
from the refinery through to the ultimate supplies the fuel that does not meet the of this section shall apply separately for
consumer from fuel having any other standards under § 80.510(a). each refinery owned or operated by a
designations and from fuel produced by (c) Option 3: A refiner that has been NRLM diesel fuel small refiner.
any other refiner. The compliance plan approved by EPA as a NRLM diesel fuel (f) Other provisions. From June 1,
must also identify all ultimate small refiner under § 80.551(g) may 2007 through May 31, 2010, a refiner
consumers to whom the refiner supplies generate diesel fuel credits under the who is an approved motor vehicle diesel
the fuel that does not meet the standards provisions of § 80.535(b) and (d), except fuel small refiner under § 80.550(a) but
under § 80.510(a). as provided in paragraph (d)(1) of this does not qualify as a NRLM diesel fuel
(b) Option 2: A refiner that has been section. small refiner under § 80.550(b) may
approved by EPA as a NRLM diesel fuel (d) Option 4: (1) In lieu of Options 1, produce NRLM diesel fuel that is
small refiner under § 80.551(g) may 2, and 3 of this section, a refiner that has exempt from the per-gallon sulfur
produce NR diesel fuel from crude oil been approved by EPA as a NRLM standard and the cetane or aromatics
from June 1, 2010, through May 31, diesel fuel small refiner under standard of § 80.510(a). This exemption
2014, and NRLM diesel fuel from crude § 80.551(g) may choose to adjust its does not apply to diesel fuel sold or
oil from June 1, 2012 through May 31, small refiner gasoline sulfur standards, intended for sale in the areas listed in
2014 that is subject to the standards subject to the following conditions: § 80.510(g)(1) or (g)(2). From June 1,
under § 80.510(a), but only for a refinery (i) From June 1, 2006 until the
2010 through May 31, 2012, NR and LM
located outside the areas specified expiration of the refiner’s small refiner
diesel fuel produced by such refiners is
under § 80.510(g)(1). gasoline sulfur standards (through
subject to the standards under
(1) The volume of NR diesel fuel that December 31, 2007 or 2010) 95 percent
§ 80.510(b) and beginning June 1, 2012,
may be subject to the 500 ppm sulfur of the NRLM diesel fuel produced by
all NRLM diesel fuel is subject to the
standard from June 1, 2010 through June the refiner must be accurately
standards under § 80.510(c).
30, 2011 must be less than or equal to designated under § 80.598(a) as meeting
the 15 ppm sulfur standard of ■ 34. A new § 80.555 is added to read as
113 percent of BNRLM, and from July 1,
2011 through May 31, 2012 must be less § 80.510(b). follows:
than or equal to 96 percent of BNRLM, as (ii) The refiner must produce NRLM § 80.555 What provisions are available to a
defined under § 80.533, less any volume diesel fuel each year or partial year large refiner that acquires a small refiner or
of locomotive and marine diesel fuel under paragraph (d)(1)(i) of this section one or more of its refineries?
produced. at a volume that is equal to or greater
(a) In the case of a refiner without
(2) The volume of NRLM diesel fuel than 85 percent of BNRLM , as defined in
approved small refiner status who
that may be subject to the 500 ppm § 80.533, calculated on an annual basis.
(2)(i) For a refiner meeting the acquires a refinery from a refiner with
sulfur standard from June 1, 2012
conditions of paragraph (d)(1) of this approved status as a motor vehicle
through June 30, 2013 must be less than
section, beginning January 1, 2004, the diesel fuel small refiner or a NRLM
or equal to 113 percent of BNRLM, and
applicable small refiner’s annual diesel fuel small refiner under
from July 1, 2013 through May 31, 2014 § 80.551(g), the applicable small refiner
must be less than or equal to 96 percent average and per-gallon cap gasoline
sulfur standards will be the standards of provisions of §§ 80.552 and 80.554 may
of BNRLM, as defined under § 80.533. apply to the acquired refinery for a
(3) NRLM diesel fuel produced in § 80.240(a) increased by a factor of 1.20
for the duration of the refiner’s small period of up to 30 months from the date
excess of the volume allowed under
refiner gasoline sulfur standards under of acquisition of the refinery. In no case
paragraph (b)(1) of this section will be
§ 80.240(a) or § 80.553 (i.e., through shall this period extend beyond May 31,
subject to the standards under
calendar years 2007 or 2010). 2010 for a refinery acquired from a
§ 80.510(b) and (c).
(4) 500 ppm sulfur NRLM diesel fuel (ii) In no case may the per-gallon cap motor vehicle diesel fuel small refiner
produced under this paragraph must— exceed 450 ppm. or beyond the dates specified in
(i) Bear a unique product code as (3)(i) If the refiner fails to produce the § 80.554(a) or (b), as applicable, for a
specified under § 80.590; and necessary volume of 15 ppm sulfur refinery acquired from a NRLM diesel
(ii) Not be sold or delivered into areas NRLM diesel fuel by June 1, 2006 and fuel small refiner.
specified under § 80.510(g)(1). every year thereafter through the (b) A refiner may apply to EPA for up
(5) From June 1, 2010 through May deadlines specified under paragraph to an additional six months to comply
31, 2012, for NR diesel fuel, and from (d)(1)(i) of this section, the refiner must with the standards of § 80.510 or 80.520
June 1, 2012 through May 31, 2014 for report this in its annual report under for the acquired refinery if more than 30
NRLM diesel fuel, a refiner that has § 80.604, and the adjustment of gasoline months would be required for the
been approved by EPA as a NRLM sulfur standards under paragraph necessary engineering, permitting,
diesel fuel small refiner under (d)(2)(i) of this section will be construction, and start-up work to be
§ 80.551(g) may produce, at a refinery considered void as of January 1, 2004. completed. Such applications must
located in Alaska, NR and NRLM diesel (ii) If such a refiner had produced include detailed technical information
fuel, as applicable, from crude oil that gasoline above its interim gasoline supporting the need for additional time.
is subject to the standards of § 80.510(a), sulfur standard of § 80.240(a) prior to EPA will base a decision to approve
only if the refiner first obtains approval June 1, 2006, such fuel will not be additional time on information provided
from the Administrator for a compliance considered in violation of the small by the refiner and on other relevant
plan. The compliance plan must detail refiner standards under § 80.240(a), information. In no case will EPA extend
how the refiner will segregate any fuel provided the refiner obtains and uses a the compliance date beyond May 31,
produced subject to the standards under quantity of gasoline sulfur credits equal 2010 for a refinery acquired from a
§ 80.510(a) from the refinery through to to the volume of gasoline exceeding the motor vehicle diesel fuel small refiner
the ultimate consumer from fuel having small refiner standards multiplied by or beyond the dates specified in
any other designations and from fuel the number of parts per million by § 80.554(a) or (b), as applicable, for a
produced by any other refiner. The which the gasoline exceeded the small refinery acquired from a NRLM diesel
compliance plan must also identify all refiner standards. fuel small refiner.
(c) Refiners who acquire a refinery impact. Approval to distribute NRLM and wholesale purchaser-consumer
from a refiner with approved status as diesel fuel not subject to the 500 ppm pump stands for the presence of the
a motor vehicle diesel fuel small refiner sulfur standard may be granted for such labels and warning signs required under
or a NRLM diesel fuel small refiner time period as EPA determines is this section. Any violations that are
under § 80.551(g), shall notify EPA in appropriate, but shall not extend discovered shall be reported to EPA
writing no later than 20 days following beyond May 31, 2010 for NR diesel fuel within 48 hours of discovery.
the acquisition. and May 31, 2012 for NRLM diesel fuel. * * * * *
■ 35. Section 80.560 is amended by Approval to distribute NRLM diesel fuel (h) Refiners who are granted a
revising paragraphs (a), (b), (d), (e), (h), not subject to the 15 ppm sulfur hardship relief standard for any refinery
(i), (k), and (l) to read as follows: standard may be granted for such time and importers of fuel subject to
period as EPA determines is temporary foreign refiner relief
§ 80.560 How can a refiner seek temporary
appropriate, but shall not extend standards, must comply with the
relief from the requirements of this subpart
in case of extreme hardship beyond May 31, 2014. requirements of § 80.561(f).
circumstances? * * * * * (i) EPA may impose any reasonable
(a) EPA may, at its discretion, grant a (d) Applicants must provide, at a conditions on waivers under this
refiner of crude oil that processes crude minimum, the following information: section, including limitations on the
oil through refinery processing units, for (1) Detailed description of efforts to refinery’s volume of motor vehicle
one or more of its refineries, temporary obtain capital for refinery investments diesel fuel and NRLM diesel fuel subject
relief from some or all of the provisions and efforts made to obtain credits for to temporary refiner relief standards.
of this subpart. Such relief shall be no compliance under § 80.531 for motor * * * * *
less stringent than the small refiner vehicle diesel fuel or §§ 80.535 through (k) The individual refinery sulfur
compliance options specified in 80.536 for NRLM diesel fuel; standard and the compliance plan will
§ 80.552 for motor vehicle diesel fuel (2) Bond rating of entity that owns the be approved or disapproved by the
and § 80.554 for NRLM diesel fuel. EPA refinery (in the case of joint ventures, Administrator, and approval will be
may grant such relief provided that the include the bond rating of the joint effective when the refiner receives an
refiner demonstrates that— venture entity and the bond ratings of approval letter from EPA. Unless
(1) Unusual circumstances exist that all partners; in the case of corporations, approved, the refiner or, where
impose extreme hardship and include the bond ratings of any parent applicable, the importer must comply
significantly affect the refiner’s ability to or subsidiary corporations); and with the motor vehicle diesel fuel
comply by the applicable date; and (3) Estimated capital investment standard under § 80.520(a)(1) by the
(2) It has made best efforts to comply needed to comply with the requirements appropriate compliance date specified
with the requirements of this subpart. of this subpart by the applicable date. in § 80.500 or the NRLM diesel fuel
(b)(1) For motor vehicle diesel fuel, (e) In addition to the application standards and compliance dates under
applications must be submitted to EPA requirements of paragraph (b) through § 80.510(a), (b), and (c) as applicable.
by June 1, 2002 to the following address: (d) of this section, a refiner’s application (l) If EPA finds that a refiner provided
U.S. EPA—Attn: Diesel Hardship, for temporary relief under this false or inaccurate information on its
Transportation and Regional Programs paragraph (e) must also include a application for hardship relief, EPA’s
Division (6406J), 1200 Pennsylvania compliance plan. Such compliance plan approval of the refiners application will
Avenue, NW., Washington, DC 20460 shall demonstrate how the refiner will be void ab initio.
(certified mail/return receipt) or Attn: engage in a quality assurance testing ■ 36. Section 80.561 is amended by
Diesel Hardship, Transportation and program, where appropriate, to ensure revising the introductory text and
Regional Programs Division, 1310 L that the following conditions are met: paragraphs (c), (d), and (f) to read as
Street, NW., 6th floor, Washington, DC (1)(i) Its motor vehicle diesel fuel follows:
20005 (express mail/return receipt). subject solely to the sulfur standards
EPA reserves the right to deny under § 80.520(c) has not caused motor § 80.561 How can a refiner or importer
applications for appropriate reasons, vehicle diesel fuel subject to the 15 ppm seek temporary relief from the requirements
including unacceptable environmental sulfur standard § 80.520(a)(1) to fail to of this subpart in case of extreme
unforseen circumstances?
impact. Approval to distribute motor comply with that standard; or
vehicle diesel fuel not subject to the 15 (ii) Its NRLM diesel fuel subject solely In appropriate extreme, unusual, and
ppm sulfur standard may be granted for to the 500 ppm sulfur standard under unforseen circumstances (for example,
such time period as EPA determines is § 80.510(a) has not caused NRLM diesel natural disaster or refinery fire) which
appropriate, but shall not extend fuel subject to the 15 ppm sulfur are clearly outside the control of the
beyond May 31, 2010. standard under § 80.510(b) or (c) to fail refiner or importer and which could not
(2) For NRLM diesel fuel, applications to comply with that standard. have been avoided by the exercise of
must be submitted to EPA by June 1, (2) The quality assurance program prudence, diligence, and due care, EPA
2005 to the following address: U.S. must at least include periodic sampling may permit a refiner or importer, for a
EPA—Attn: Diesel Hardship, and testing at the party’s own facilities brief period, to distribute motor vehicle
Transportation and Regional Programs and at downstream facilities in the diesel fuel or NRLM diesel fuel which
Division (6406J), 1200 Pennsylvania refiner’s or importer’s diesel fuel does not meet the requirements of this
Avenue, NW., Washington, DC 20460 distribution system, to determine subpart if:
(certified mail/return receipt) or Attn: compliance with the applicable sulfur * * * * *
Diesel Hardship, Transportation and standards for both categories of motor (c) The refiner or importer can show
Regional Programs Division, 1310 L vehicle diesel fuel; examination at the how the requirements for motor vehicle
Street, NW., 6th floor, Washington, DC party’s own facilities and at applicable diesel fuel or NRLM diesel fuel will be
20005 (express mail/return receipt). downstream facilities, of product expeditiously achieved;
EPA reserves the right to deny transfer documents to confirm (d) The refiner or importer agrees to
applications for appropriate reasons, appropriate transfers and deliveries of make up any air quality detriment
including unacceptable environmental both products; and inspection of retailer associated with the nonconforming
motor vehicle diesel fuel or NRLM Recommended for use in all diesel vehicles fuel (including nonroad (NR) and
diesel fuel, where practicable; and engines. locomotive or marine (LM)), or heating
* * * * * (b) From June 1, 2006 through oil, must prominently and
(f)(1) In the case of motor vehicle September 30, 2010, any retailer or conspicuously display in the immediate
diesel fuel distributed under this section wholesale purchaser-consumer who area of each pump stand from which
that does not meet the 15 ppm sulfur sells, dispenses, or offers for sale or non-highway diesel fuel is offered for
standard under § 80.520(a)(1), such dispensing, motor vehicle diesel fuel sale or dispensing, one of the following
diesel fuel shall not be distributed for subject to the 500 ppm sulfur standard legible labels, as applicable, in block
use in model year 2007 or later motor of § 80.520(c), must prominently and letters of no less than 24-point bold
vehicles, and must meet all the conspicuously display in the immediate type, printed in a color contrasting with
requirements and prohibitions of this area of each pump stand from which the background:
subpart applicable to diesel fuel meeting motor vehicle fuel subject to the 500 (a) From June 1, 2007 through May 31,
the sulfur standard under § 80.520(c), or ppm sulfur standard is offered for sale 2010, for pumps dispensing NRLM
to diesel fuel that is not motor vehicle or dispensing, the following legible diesel fuel meeting the 15 ppm sulfur
diesel fuel, as applicable. label, in block letters of no less than 24- standard of § 80.510(b):
(2) In the case of NRLM diesel fuel point bold type, printed in a color ULTRA-LOW SULFUR NON-HIGHWAY
distributed under this section from June contrasting with the background: DIESEL FUEL (15 ppm Sulfur Maximum)
1, 2007 through May 31, 2010 that does
not meet the 500 ppm sulfur standard LOW SULFUR HIGHWAY DIESEL FUEL Required for use in all model year 2011
(500 ppm Sulfur Maximum) and newer nonroad diesel engines.
under § 80.510(a), such diesel fuel must Recommended for use in all nonroad,
meet the requirements and prohibitions WARNING locomotive, and marine diesel engines.
applicable to high sulfur NRLM credit Federal law prohibits use in model year
fuel under § 80.536(f)(1)(i) and (ii). 2007 and later highway vehicles and engines. WARNING
(3) In the case of NR diesel fuel Its use may damage these vehicles and Federal Law prohibits use in highway
distributed under this section after May engines. vehicles or engines.
31, 2010 that does not meet the 15 ppm (c) From June 1, 2006 through May 31, (b) From June 1, 2007 through May
sulfur standard under § 80.510(b), such 2007, any retailer or wholesale 31, 2010, for pumps dispensing NRLM
diesel fuel shall not be distributed for purchaser-consumer who sells, diesel fuel meeting the 500 ppm sulfur
use in model year 2011 or later nonroad dispenses, or offers for sale or standard of § 80.510(a):
engines, and must meet all the dispensing, diesel fuel for non-motor
requirements and prohibitions of this LOW SULFUR NON-HIGHWAY DIESEL
vehicle equipment that does not meet FUEL (500 ppm Sulfur Maximum)
subpart applicable to diesel fuel meeting the standards for motor vehicle diesel
the sulfur standard under § 80.510(a) for fuel, must affix the following WARNING
NRLM diesel fuel. conspicuous and legible label, in block Federal Law prohibits use in highway
(4) In the case of NRLM diesel fuel letters of no less than 24-point bold vehicles or engines.
distributed under this section after May type, and printed in a color contrasting
31, 2012 that does not meet the 15 ppm (c) From June 1, 2007 through
with the background, to each pump September 30, 2010, for pumps
sulfur standard under § 80.510(c), such stand:
diesel fuel shall not be distributed for Ä dispensing NRLM diesel fuel not
use in model year 2011 or later nonroad Ä NON-HIGHWAY DIESEL FUEL (May Exceed meeting, or not offered as meeting, the
engines, and must meet all the Ä 500 ppm Sulfur) 500 ppm sulfur standard of § 80.510(a)
requirements and prohibitions of this Ä or the 15 ppm sulfur standard of
WARNING
subpart applicable to diesel fuel meeting Ä § 80.510(b):
Federal law prohibits use in highway
the sulfur standard under § 80.510(a) for Ä vehicles or engines. HIGH SULFUR NON-HIGHWAY DIESEL
NRLM diesel fuel.Ä Its use may damage these vehicles and FUEL (May Exceed 500 ppm Sulfur)
■ 37. Section 80.570 is revised to read as Ä engines. WARNING
follows:Ä (d) The labels required by paragraphs Federal law prohibits use in highway
§ 80.570 What labeling requirements apply (a) through (c) of this section must be vehicles or engines.
to retailers and wholesale purchaser- placed on the vertical surface of each May damage nonroad diesel engines
consumers of diesel fuel beginning June 1, pump housing and on each side that has required to use low-sulfur or ultra-low sulfur
2006? gallon and price meters. The labels shall diesel fuel.
(a) From June 1, 2006 through May 31, be on the upper two-thirds of the pump, (d) From June 1, 2007 and beyond, for
2010, any retailer or wholesale in a location where they are clearly pumps dispensing non-motor vehicle
purchaser-consumer who sells, visible. diesel fuel for use other than in
dispenses, or offers for sale or (e) Alternative labels to those nonroad, locomotive or marine engines,
dispensing, motor vehicle diesel fuel specified in paragraphs (a) through (c) of such as for use in stationary diesel
subject to the 15 ppm sulfur standard of this section may be used as approved by engines or as heating oil:
§ 80.520(a)(1), must affix the following the Administrator.
■ 38. A new § 80.571 is added to read as HEATING OIL (May Exceed 500 ppm Sulfur)
conspicuous and legible label, in block
letters of no less than 24-point bold follows: WARNING
type, and printed in a color contrasting § 80.571 What labeling requirements apply Federal law prohibits use in highway
with the background, to each pump to retailers and wholesale purchaser- vehicles or engines, or in nonroad,
stand: consumers of NRLM diesel fuel or heating locomotive, or marine diesel engines.
oil beginning June 1, 2007? Its use may damage these diesel engines.
ULTRA-LOW SULFUR HIGHWAY DIESEL
FUEL (15 ppm Sulfur Maximum) Any retailer or wholesale purchaser- (e) The labels required by paragraphs
Required for use in all model year 2007 consumer who sells, dispenses, or offers (a) through (d) of this section must be
and later highway diesel vehicles and for sale or dispensing nonroad, placed on the vertical surface of each
engines. locomotive or marine (NRLM) diesel pump housing and on each side that has
gallon and price meters. The labels shall LOW SULFUR NON-HIGHWAY DIESEL (b) The labels required by paragraph
be on the upper two-thirds of the pump, FUEL (500 ppm Sulfur Maximum) (a) of this section must be placed on the
in a location where they are clearly WARNING vertical surface of each pump housing
visible. Federal law prohibits use in all model year
and on each side that has gallon and
(f) Alternative labels to those 2011 and newer nonroad engines. price meters. The labels shall be on the
specified in paragraphs (a) through (d) May damage model year 2011 and newer upper two-thirds of the pump, in a
of this section may be used as approved nonroad engines. location where they are clearly visible.
by the Administrator. Federal law prohibits use in highway (c) Alternative labels to those
vehicles or engines. specified in paragraph (a) of this section
■ 39. A new § 80.572 is added to read as may be used as approved by the
follows: (d) From June 1, 2010 through
Administrator.
September 30, 2012, for pumps ■ 41. A new § 80.574 is added to read as
§ 80.572 What labeling requirements apply dispensing LM diesel fuel subject to the
to retailers and wholesale purchaser- follows:
500 ppm sulfur standard of § 80.510(a):
consumers of NR and NRLM diesel fuel and
LOW SULFUR LOCOMOTIVE AND § 80.574 What labeling requirements apply
heating oil beginning June 1, 2010?
MARINE DIESEL FUEL (500 ppm Sulfur to retailers and wholesale purchaser-
Any retailer or wholesale purchaser- Maximum) consumers of NRLM diesel fuel, or heating
consumer who sells, dispenses, or offers oil beginning June 1, 2014?
WARNING Any retailer or wholesale purchaser-
for sale or dispensing nonroad,
locomotive or marine (NRLM) diesel Federal law prohibits use in nonroad consumer who sells, dispenses, or offers
fuel (including nonroad (NR) and engines or in highway vehicles or engines. for sale or dispensing nonroad,
locomotive or marine (LM)), or heating (e) The labels required by paragraphs locomotive or marine (NRLM) diesel
oil, must prominently and (a) through (d) of this section must be fuel (including nonroad (NR) and
conspicuously display in the immediate placed on the vertical surface of each locomotive or marine (LM)), or heating
area of each pump stand from which pump housing and on each side that has oil, must prominently and
non-highway diesel fuel is offered for gallon and price meters. The labels shall conspicuously display in the immediate
sale or dispensing, one of the following be on the upper two-thirds of the pump, area of each pump stand from which
legible labels, as applicable, in block in a location where they are clearly non-highway diesel fuel is offered for
letters of no less than 24-point bold visible. sale or dispensing, one of the following
type, printed in a color contrasting with (f) Alternative labels to those legible labels, as applicable, in block
the background: specified in paragraphs (a) through (d) letters of no less than 24-point bold
of this section may be used as approved type, printed in a color contrasting with
(a) From June 1, 2010 and beyond,
by the Administrator. the background:
any retailer or wholesale purchaser- (a) From June 1, 2014 and beyond, for
consumer who sells, dispenses, or offers ■ 40. A new § 80.573 is added to read as
pumps dispensing NRLM diesel fuel
for sale or dispensing, motor vehicle follows: subject to the 15 ppm sulfur standard of
diesel fuel subject to the 15 ppm sulfur § 80.510(c):
standard of § 80.520(a)(1), must affix the § 80.573 What labeling requirements apply
to retailers and wholesale purchaser- ULTRA-LOW SULFUR NON-HIGHWAY
following conspicuous and legible label, consumers of NRLM diesel fuel and heating
in block letters of no less than 24-point DIESEL FUEL (15 ppm Sulfur Maximum)
oil beginning June 1, 2012?
bold type, and printed in a color Required for use in all nonroad diesel
contrasting with the background, to Any retailer or wholesale purchaser- engines.
each pump stand: consumer who sells, dispenses, or offers Recommended for use in all locomotive
for sale or dispensing nonroad, and marine diesel engines.
ULTRA-LOW SULFUR HIGHWAY DIESEL locomotive or marine (NRLM) diesel
FUEL (15 ppm Sulfur Maximum) WARNING
fuel (including nonroad (NR) and
Required for use in all highway diesel locomotive or marine (LM)), or heating Federal law prohibits use in highway
vehicles and engines. vehicles or engines.
oil, must prominently and
Recommended for use in all diesel vehicles conspicuously display in the immediate (b) From June 1, 2014 and beyond, for
and engines. area of each pump stand from which pumps dispensing LM diesel fuel
non-highway diesel fuel is offered for subject to the 500 ppm sulfur standard
(b) From June 1, 2010 through May
sale or dispensing, one of the following of § 80.510(a):
31, 2012, for pumps dispensing NR
diesel fuel subject to the 15 ppm sulfur legible labels, as applicable, in block LOW SULFUR LOCOMOTIVE OR MARINE
standard of § 80.510(b): letters of no less than 24-point bold DIESEL FUEL (500 ppm Sulfur Maximum)
type, printed in a color contrasting with
ULTRA-LOW SULFUR NON-HIGHWAY WARNING
the background:
DIESEL FUEL (15 ppm Sulfur Maximum) Federal law prohibits use in nonroad
(a) From June 1, 2012 through May 31,
Required for use in all model year 2011 engines or in highway vehicles or engines.
2014, for pumps dispensing NRLM Its use may damage these engines.
and later nonroad diesel engines. diesel fuel subject to the 15 ppm sulfur
Recommended for use in all other non- (c) The labels required by paragraphs
standard of § 80.510(c):
highway diesel engines. (a) and (b) of this section must be placed
ULTRA-LOW SULFUR NON-HIGHWAY on the vertical surface of each pump
WARNING
DIESEL FUEL (15 ppm Sulfur Maximum)
Federal law prohibits use in highway housing and on each side that has gallon
Required for use in all model year 2011 and price meters. The labels shall be on
vehicles or engines.
and later nonroad diesel engines. the upper two-thirds of the pump, in a
(c) From June 1, 2010 through Recommended for use in all other non-
highway diesel engines.
location where they are clearly visible.
September 30, 2014, for pumps (d) Alternative labels to those
dispensing NRLM diesel fuel subject to WARNING specified in paragraphs (a) and (b) of
the 500 ppm sulfur standard of Federal law prohibits use in highway this section may be used as approved by
§ 80.510(a): vehicles or engines. the Administrator.
■ 42. Section 80.580 is revised to read as (d) Adjustment Factor for downstream sample from each batch of motor vehicle
follows: test results. An adjustment factor of or NRLM diesel fuel produced or
negative two ppm sulfur shall be imported and subject to the 15 ppm
§ 80.580 What are the sampling and applied to the test results, to account for sulfur content standard. Batch, for the
testing methods for sulfur?
test variability, but only for testing of purposes of this section, means batch as
The sulfur content of diesel fuel and motor vehicle diesel fuel or NRLM defined under § 80.2 but without the
diesel fuel additives is to be determined diesel fuel identified as subject to the 15 reference to transfer of custody from one
in accordance with this section. ppm sulfur standard of § 80.510(b) or facility to another facility.
(a) Sampling method. The applicable § 80.520(a)(1). (b) Except as provided in paragraph
sampling methodology is provided in (e) Materials incorporated by (c) of this section, the refiner or
§ 80.330(b). reference. The Director of the Federal importer shall test each sample
(b) Test method for sulfur. (1) Until Register approved the incorporation by collected pursuant to paragraph (a) of
December 27, 2004, for motor vehicle reference of the documents listed in this this section to determine its sulfur
diesel fuel and diesel fuel additives section as prescribed in 5 U.S.C. 552(a) content for compliance with the
subject to the 15 ppm sulfur standard of and 1 CFR part 51. Anyone may inspect requirements of this subpart prior to the
§ 80.520(a)(1), sulfur content may be copies at the U.S. EPA, Air and diesel fuel leaving the refinery or import
determined using ASTM D 6428–99. Radiation Docket and Information facility, using an appropriate sampling
(2) For motor vehicle diesel fuel and Center, 1301 Constitution Ave., NW., and testing method as specified in
diesel fuel additives subject to the 500 Room B102, EPA West Building, § 80.580.
ppm sulfur standard of § 80.520(c), and Washington, DC 20460 or at the (c)(1) Any refiner who produces
NRLM diesel fuel subject to the 500 National Archives and Records motor vehicle or NRLM diesel fuel using
ppm sulfur standard of § 80.510(a)(1), Administration (NARA). For computer-controlled in-line blending
sulfur content may be determined using information on the availability of this equipment, including the use of an on-
ASTM D 2622–03. material at NARA, call 202–741–6030, line analyzer test method that is
(3) Beginning August 30, 2004, for or go to: http://www.archives.gov/ approved under the provisions of
motor vehicle diesel fuel and diesel fuel federal_register/ § 80.580, and who, subsequent to
additives subject to the 15 ppm sulfur code_of_federal_regulations/ production of the diesel fuel batch tests
standard of § 80.520(a)(1), sulfur content ibr_locations.html. a composited sample of the batch under
may be determined using any test (1) ASTM material. Anyone may the provisions of § 80.580 for purposes
method approved under § 80.585. purchase copies of these materials from of designation and reporting, is exempt
the American Society for Testing and from the requirement of paragraph (b) of
(4) Beginning August 30, 2004, for
Materials, 100 Barr Harbor Dr., West this section to obtain the test result
NRLM diesel fuel and diesel fuel
Conshohocken, PA 19428. required under this section prior to the
additives subject to the 15 ppm standard
(i) ASTM D 2622–03, Standard Test diesel fuel leaving the refinery,
of § 80.510(b), sulfur content may be
Method for Sulfur in Petroleum provided that the refiner obtains
determined using any test method
Products by Wavelength Dispersive X- approval from EPA.
approved under § 80.585. (2) To obtain an exemption from
(c) Alternative test methods for sulfur. ray Fluorescence Spectrometry.
(ii) ASTM D 3120–03a, Standard Test paragraph (b) of this section, the refiner
(1) Until December 27, 2004, for motor must submit to EPA all the information
vehicle diesel fuel and diesel fuel Method for Trace Quantities of Sulfur in
Light Liquid Petroleum Hydrocarbons required under § 80.65(f)(4)(i)(A). A
additives subject to the 15 ppm standard letter signed by the president, chief
of § 80.520(a)(1), sulfur content may be by Oxidative Microcoulometry.
(iii) ASTM D 4294–03, Standard Test operating or chief executive officer of
determined using ASTM D 5453–03a or the company, or his/her designee,
ASTM D 3120–03a, provided that the Method for Sulfur in Petroleum and
Petroleum Products by Energy- stating that the information contained in
refiner or importer test result is the submission is true to the best of his/
correlated with the appropriate method Dispersive X-ray Fluorescence
Spectrometry. her belief must accompany any
specified in paragraph (a)(2) of this submission under this paragraph (c)(2).
section. (iv) ASTM D 5453–03a, Standard Test
Method for Determination of Total (3) Refiners who seek an exemption
(2) Options for testing sulfur content under paragraph (c)(2) of this section
of 500 ppm diesel fuel. (i) For motor Sulfur in Light Hydrocarbons, Motor
Fuels and Motor Oils by Ultraviolet must comply with any request by EPA
vehicle diesel fuel and diesel fuel for additional information or any other
additives subject to the 500 ppm sulfur Fluorescence.
(v) ASTM D 6428–99, Test Method for requirements that EPA includes as part
standard of § 80.520(c), and for NRLM of the exemption.
diesel fuel subject to the 500 ppm sulfur Total Sulfur in Liquid Aromatic
Hydrocarbons and Their Derivatives by (4) Within 60 days of EPA’s receipt of
standard of § 80.510(a), sulfur content a submission under paragraph (c)(2) of
may be determined using ASTM D Oxidative Combustion and
Electrochemical Detection. this section, EPA will notify the refiner
4294–03, ASTM D 5453–03a, or ASTM if the exemption is not approved or of
(2) [Reserved]
D 6428–99, provided that the refiner or any deficiencies in the refiner’s
■ 43. A new § 80.581 is added to read as
importer test result is correlated with submission, or if any additional
follows:
the appropriate method specified in information is required or other
paragraph (a)(2)(ii) of this section; or § 80.581 What are the batch testing and requirements are included in the
(ii) For motor vehicle diesel fuel and sample retention requirements for motor exemption pursuant to paragraph (c)(3)
diesel fuel additives subject to the 500 vehicle and NRLM diesel fuel? of this section. In the absence of such
ppm sulfur standard of § 80.520(c), and (a) Beginning on June 1, 2006 or notification from EPA, the effective date
for NRLM diesel fuel subject to the 500 earlier pursuant to § 80.531 for motor of an exemption under this paragraph
ppm sulfur standard of § 80.510(a), vehicle diesel fuel, and beginning June (c) is 60 days from EPA’s receipt of the
sulfur content may be determined using 1, 2010 or earlier pursuant to § 80.535 refiner’s submission.
any test method approved under for NRLM diesel fuel, each refiner and (5) EPA reserves the right to modify
§ 80.585. importer shall collect a representative the requirements of an exemption under
this paragraph (c), in whole or in part, regulatory specifications and which body may be qualified upon approval by
at any time, if EPA determines that the contains the fuel marker at a the Administrator. The following
refiner’s operation does not effectively concentration in the range of 0.10 to 8 information must be submitted in the
or adequately control, monitor or milligrams per liter. In order to qualify, application for approval by each test
document the sulfur content of the the 20 results must be a series of tests facility, for each test method that it
refinery’s diesel fuel production, or if on the same material and there must be wishes to have approved:
EPA determines that any other a sequential record of the analysis with (i) Full test method documentation,
circumstances exist which merit no omissions. A laboratory facility may including a description of the
modification of the requirements of an exclude a given sample or test result technology and/or instrumentation that
exemption, such as advancements in the only if the exclusion is for a valid makes the method functional.
state of the art for in-line blending reason under good laboratory practices (ii) Information demonstrating that
measurement which allow for and it maintains records regarding the the test method meets the accuracy and
additional control or more accurate sample and test results and the reason precision criteria under paragraph (b) of
monitoring or documentation of sulfur for excluding them. this section, including information on
content. If EPA finds that a refiner (2) Accuracy. (i) The arithmetic the date and time of each test
provided false or inaccurate information average of a continuous series of at least measurement used to demonstrate
in any submission required for an 10 tests performed on a commercially precision.
exemption under this section, upon available marker solvent yellow 124 (iii) Samples used for precision and
notification from EPA, the refiner’s standard in the range of 0.10 to 1 accuracy determination must be
exemption will be void ab initio. milligrams per liter shall not differ from retained for 90 days.
(d) All test results under this section the ARV of that standard by more than (iv) If requested by the Administrator,
shall be retained for five years and must 0.05 milligrams per liter. test results utilizing the method and
be provided to EPA upon request. (ii) The arithmetic average of a performed on a sample of commercially
(e) Samples collected under this continuous series of at least 10 tests available distillate fuel which meets the
section must be retained for at least 30 performed on a commercially available
applicable industry consensus and
days and provided to EPA upon request. marker solvent yellow 124 standard in
federal regulatory specifications and
■ 44. A new § 80.582 is added to read as the range of 4 to 10 milligrams per liter
which contains the fuel marker.
follows: shall not differ from the ARV of that
(v) Any additional information
standard by more than 0.05 milligrams
§ 80.582 What are the sampling and requested by the Administrator and
per liter.
testing methods for the fuel marker? (iii) In applying the tests of necessary to render a decision as to
For heating oil and NRLM diesel fuel paragraphs (b)(2)(i) and (ii) of this qualification of the test method.
subject to the fuel marker requirement section, individual test results shall be (vi) The qualification of a test method
in § 80.510(d), (e), or (f), the compensated for any known chemical is limited to the single test facility that
identification of the presence and interferences. performed the testing for accuracy and
concentration of the fuel marker in (c) What process must a test facility precision and any other required testing.
diesel fuel may be determined using the follow in order to qualify a test method (3)(i) Within 90 days of receipt of all
test procedures qualified in accordance for determining the fuel marker content materials required to be submitted
with the requirements in this section. of distillate fuels and how will EPA under paragraph (c)(1) or (c)(2) of this
(a) Sampling and testing for methods qualify or decline to qualify a test section, the Administrator shall
for the fuel marker. The sampling, method? (1) Qualification of test determine whether to qualify the test
sample preparation, and testing methods approved by voluntary method under this section. The
methods qualified for use in accordance consensus-based standards bodies. Any Administrator shall qualify the test
with the requirements of this section standard test method developed by a method if all materials required under
may involve the use of hazardous Voluntary Consensus-Based Standards this section are received and the test
materials, operations and equipment. Body, such as the American Society for method meets the accuracy and
This section does not address the Testing and Materials (ASTM) or precision criteria of paragraph (b) of this
associated safety problems which may International Standards Organization section.
exist. It is the responsibility of the user (ISO), shall be considered a qualified (ii) If the Administrator denies
of the procedures specified in this test method for determining the fuel approval of the test method, within 90
section to establish appropriate safety marker content of distillate fuel days of receipt of all materials required
and health practices prior to their use. provided that it meets the precision and to be submitted under this section, the
It is also the responsibility of the user accuracy criteria under paragraph (b) of Administrator will notify the applicant
to dispose of any byproducts which this section. The qualification of a test of the reasons for not approving the
might result from conducting these method is limited to the single test method. If the Administrator does not
procedures in a manner consistent with facility that performed the testing for notify the applicant within 90 days of
applicable safety and health accuracy and precision. The individual receipt of the application, that the test
requirements. facility must submit the accuracy and method is not approved, then the test
(b) What are the precision and precision results for each method, method shall be deemed approved.
accuracy criteria for qualification of fuel including information on the date and (iii) If the Administrator finds that an
marker test methods? (1) Precision. A time of each test measurement used to individual test facility has provided
standard deviation of less than 0.10 demonstrate precision, following false or inaccurate information under
milligrams per liter is required, procedures established by the this section, upon notice from the
computed from the results of a Administrator. Administrator, the qualification shall be
minimum of 20 repeat tests made over (2) Qualification of test methods that void ab initio.
20 days on samples taken from a have not been approved by a voluntary (iv) The qualification of any test
homogeneous commercially available consensus-based standards body. A test method under this paragraph (c) shall be
diesel fuel which meets the applicable method that has not been approved by valid for the duration of the period
industry consensus and federal a voluntary consensus-based standards during which the fuel marker
requirements remain applicable under under paragraph (d)(3) of this section for Ä (c) Party required to conduct quality
this subpart. five years.Ä assurance testing. The quality assurance
(d) Quality control procedures for fuel ■ 45. A new § 80.583 is added to read as Ä program under paragraph (b) of this
marker measurement instrumentation. follows:Ä section shall be conducted by the
A test shall not be considered a test importer. In the alternative, this testing
using a qualified test method unless the § 80.583 What alternative sampling and
may be conducted by an independent
testing requirements apply to importers
following quality control procedures are laboratory that meets the criteria under
who transport motor vehicle diesel fuel or
performed separately for each NRLM diesel fuel by truck or rail car? § 80.65(f)(2)(iii), provided the importer
instrument used to make measurements: receives copies of all results of tests
(1) Follow all mandatory provisions of Importers who import diesel fuel
subject to the 15 ppm sulfur standard conducted no later than 21 days after
ASTM D 6299–02 and construct control
charts from the mandatory quality under § 80.510(b) or (c) or 80.520(a) into the sample was taken.
the United States by truck or by rail car (d) Alternative batch designations.
control testing prescribed in paragraph For purposes of maintaining batch
7.1 of the reference method, following may comply with the following
requirements instead of the records under §§ 80.592, 80.600, and
guidelines under A 1.5.1 for individual 80.602, designation of batches under
observation charts and A 1.5.2 for requirements to sample and test each
moving range charts. The Director of the batch of fuel designated as subject to the § 80.598, and reporting under §§ 80.593,
15 ppm sulfur standard under § 80.581 80.601, and 80.604:
Federal Register approved the (1) In lieu of treating each portion of
incorporation by reference of ASTM D otherwise applicable to importers:
(a) Terminal testing. For purposes of a tank truck compartment delivered to
6299–02, Standard Practice for a different facility as a different batch,
Applying Statistical Quality Assurance determining compliance with the 15
ppm sulfur standard, the importer may a truck importer may treat each
Techniques to Evaluate Analytical
Measurement System Performance, as use test results for sulfur content testing compartment as a batch, if all the fuel
conducted by the foreign truck-loading in the compartment is delivered only to
prescribed in 5 U.S.C. 552(a) and 1 CFR retail outlets, wholesale purchaser-
part 51. Anyone may purchase copies of or rail car-loading terminal operator for
this standard from the American Society diesel fuel contained in the storage tank consumers or other end users. Where
from which trucks or rail cars used to different compartments contain
for Testing and Materials, 100 Barr
transport diesel fuel designated as homogeneous product of identical
Harbor Dr., West Conshohocken, PA
subject to the 15 ppm sulfur content designations, the total volume of those
19428. Anyone may inspect copies at
standard into the United States are compartments may be treated as a single
the U.S. EPA, Air and Radiation Docket
loaded, provided the following batch, if the entire volume is delivered
and Information Center, 1301
conditions are met: only to retail outlets, wholesale
Constitution Ave., NW., Room B102,
(1) The sampling and testing shall be purchaser-consumers or other ultimate
EPA West Building, Washington, DC
performed after each receipt of diesel consumers.
20460 or at the National Archives and
Records Administration (NARA). For fuel into the storage tank, or (2) Each portion of a rail car (or rail
information on the availability of this immediately before each transfer of cars) delivery of a different designation
material at NARA, call 202–741–6030, diesel fuel to the importer’s truck or rail or each delivery to a different facility is
or go to: http://www.archives.gov/ car. considered to be a separate batch.
federal_register/ (2) The sampling and testing shall be (e) EPA inspections of terminals. EPA
code_of_federal_regulations/ performed according to § 80.580. inspectors or auditors must be given full
ibr_locations.html. (3) At the time of each transfer of and immediate access to the truck or rail
(2) Follow paragraph 7.3.1 of ASTM D diesel fuel to the importer’s truck or rail car-loading terminal and any laboratory
6299–02 to check standards using a car for import to the U.S., the importer at which samples of diesel fuel collected
reference material at least monthly or must obtain a copy of the terminal test at the terminal are analyzed, and must
following any major change to the result that indicates the sulfur content be allowed to conduct inspections,
laboratory equipment or test procedure. of the truck or rail car load, or truck or review records, collect diesel fuel
Any deviation from the accepted rail car compartment load, as samples and perform audits. These
reference value of a check standard applicable. inspections or audits may be either
greater than 0.10 milligrams per liter (b) Quality assurance program. The announced or unannounced.
must be investigated. importer must conduct a quality (f) Certified DFR-Diesel. This section
(3) Samples of tested batches must be assurance program, as specified in this does not apply to Certified DFR-Diesel
retained for 30 days or the period equal paragraph (b), for each truck or rail car as defined in § 80.620.
to the interval between quality control loading terminal. (g) Effect of noncompliance. If any of
sample tests, whichever is longer. (1) Quality assurance samples must be the requirements of this section are not
(4) Upon discovery of any quality obtained from the truck-loading or rail met, all motor vehicle diesel fuel and
control testing violation of paragraph A car loading terminal and tested by the NRLM diesel fuel imported by the truck
1.5.1.3 or A 1.5.2.1 of ASTM D 6299– importer, or by an independent or rail car importer during the time the
02, or any check standard deviation laboratory, and the terminal operator requirements are not met is deemed in
greater than 0.10 milligrams per liter, must not know in advance when violation of the 15 ppm sulfur diesel
conduct an investigation into the cause samples are to be collected. fuel standards in § 80.510(b) or (c) or
of such violation or deviation and, after (2) The sampling and testing must be § 80.520(a), as applicable. Additionally,
restoring method performance to performed using the methods specified if any requirement is not met, EPA may
statistical control, retest retained in § 80.580. notify the importer of the violation, and,
samples from batches originally tested (3) The frequency of the quality if the requirement is not fulfilled within
since the last satisfactory quality control assurance sampling and testing must be 10 days of notification, the truck
material or check standard testing at least one sample for each 50 of an importer may not in the future use the
occasion. importer’s trucks or rail cars that are sampling and testing provisions in this
(5) Retain results of quality control loaded at a terminal, or one sample per section in lieu of the provisions in
testing and retesting of retained samples month, whichever is more frequent. § 80.581.
■ 46. A new § 80.584 is added to read as from the ARV of that standard by more each test method that it wishes to have
follows: than 0.54 ppm sulfur; and approved:
(iii) In applying the tests of (1) Full test method documentation,
§ 80.584 What are the precision and paragraphs (b)(1)(i) and (ii) of this including a description of the
accuracy criteria for approval of test
section, individual test results shall be technology and/or instrumentation that
methods for determining the sulfur content
of motor vehicle and NRLM diesel fuel? compensated for any known chemical makes the method functional.
interferences. (2) Information demonstrating that the
(a) Precision. (1) For motor vehicle test method meets the applicable
(2) For motor vehicle diesel fuel
diesel fuel and diesel fuel additives accuracy and precision criteria of
subject to the 500 ppm sulfur standard
subject to the 15 ppm sulfur standard of § 80.584, including information on the
of § 80.520(c), and for NRLM diesel fuel
§ 80.520(a)(1) and NRLM diesel fuel and date and time of each test measurement
subject to the 500 ppm sulfur standard
diesel fuel additives subject to the 15 used to demonstrate precision.
of § 80.510(a):
ppm sulfur standard of § 80.510(b) and (i) The arithmetic average of a (3) If requested by the Administrator,
(c), a standard deviation less than 0.72 continuous series of at least 10 tests test results from use of the method to
ppm, computed from the results of a performed on a commercially available analyze samples of commercially
minimum of 20 repeat tests made over gravimetric sulfur standard in the range available fuel provided by EPA.
20 days on samples taken from a single of 100–200 ppm sulfur shall not differ (4) Any additional information
homogeneous commercially available from the ARV of that standard by more requested by the Administrator and
diesel fuel with a sulfur content in the than 7.26 ppm sulfur; necessary to render a decision as to
range of 5–15 ppm. The 20 results must (ii) The arithmetic average of a approval of the test method.
be a series of tests with a sequential continuous series of at least 10 tests (c) Sample retention. Samples used
record of the analyses and no omissions. performed on a commercially available for precision and accuracy
A laboratory facility may exclude a gravimetric sulfur standard in the range determination must be retained for 90
given sample or test result only if the of 400–500 ppm sulfur shall not differ days.
exclusion is for a valid reason under from the ARV of that standard by more (d) EPA approval. (1) Within 90 days
good laboratory practices and it than 7.26 ppm sulfur; and of receipt of all materials required to be
maintains records regarding the sample (iii) In applying the tests of submitted under paragraph (a) or (b) of
and test results and the reason for paragraphs (b)(2)(i) and (ii) of this this section, the Administrator shall
excluding them. section, individual test results shall be determine whether the test method is
(2) For motor vehicle diesel fuel compensated for any known chemical approved under this section.
subject to the 500 ppm sulfur standard interferences. (2) If the Administrator denies
of § 80.520(c), and for NRLM diesel fuel ■ 47. A new § 80.585 is added to read as approval of the test method, within 90
subject to the 500 ppm sulfur standard follows: days of receipt of all materials required
of § 80.510(a), of a standard deviation to be submitted under paragraph (a) or
less than 9.68 ppm, computed from the § 80.585 What is the process for approval (b) of this section, the Administrator
results of a minimum of 20 repeat tests of a test method for determining the sulfur will notify the applicant of the reasons
made over 20 days on samples taken content of diesel? for not approving the method. If the
from a single homogeneous (a) Approval of test methods approved Administrator does not notify the
commercially available diesel fuel with by voluntary consensus-based standards applicant within 90 days of receipt of
a sulfur content in the range of 200–500 bodies. For such a method to be the application, that the test method is
ppm. The 20 results must be a series of approved, the following information not approved, then the test method shall
tests with a sequential record of the must be submitted to the Administrator be deemed approved.
analyses and no omissions. A laboratory by each test facility for each test method (3) If the Administrator finds that an
facility may exclude a given sample or that it wishes to have approved: Any individual test facility has provided
test result only if the exclusion is for a test method approved by a voluntary false or inaccurate information under
valid reason under good laboratory consensus-based standards body, such this section, upon notice from the
practices and it maintains records as the American Society for Testing and Administrator the approval shall be
regarding the sample and test results Materials (ASTM) or International void ab initio.
and the reason for excluding them. Standards Organization (ISO), shall be (4) The approval of any test method
(b) Accuracy. (1) For motor vehicle approved as a test method for under paragraph (b) of this section shall
diesel fuel and diesel fuel additives determining the sulfur content of diesel be valid for five years from the date of
subject to the 15 ppm sulfur standard of fuel if it meets the applicable accuracy approval by the Administrator and shall
§ 80.520(a)(1) and NRLM diesel fuel and and precision criteria under § 80.584. not be extended. If the method is later
diesel fuel additives subject to the 15 The approval of a test method is limited approved by a voluntary consensus-
ppm sulfur standard of § 80.510(b) and to the single test facility that performed based standards body, the approval
(c): the testing for accuracy and precision. shall remain valid as long as the
(i) The arithmetic average of a The individual facility must submit the conditions of paragraph (a) of this
continuous series of at least 10 tests accuracy and precision results for each section are met.
performed on a commercially available method, including information on the (e) Quality assurance procedures for
gravimetric sulfur standard in the range date and time of each test measurement sulfur measurement instrumentation. A
of 1–10 ppm sulfur shall not differ from used to demonstrate precision, test shall not be considered a test using
the accepted reference value (ARV) of following procedures established by the an approved test method unless the
that standard by more than 0.54 ppm Administrator. following quality control procedures are
sulfur; (b) Approval of test methods not performed separately for each
(ii) The arithmetic average of a approved by a voluntary consensus- instrument used to make measurements:
continuous series of at least 10 tests based standards body. For such a (1) Follow all mandatory provisions of
performed on a commercially available method to be approved, the following ASTM D 6299–02 and construct control
gravimetric sulfur standard in the range information must be submitted to the charts from the mandatory quality
of 10–20 ppm sulfur shall not differ Administrator by each test facility for control testing prescribed in paragraph
7.1 of the reference method, following values, all test method documentation, Ä sulfur (maximum) Dyed Ultra-Low
guidelines under A 1.5.1 for individual and any quality control testing and Ä Sulfur Diesel Fuel. For use in all
observation charts and A 1.5.2 for analysis under §§ 80.582, 80.584 and Ä nonroad diesel engines. Not for use in
moving range charts. The Director of the 80.585, for five years.Ä highway vehicles or engines except for
Federal Register approved the ■ 49. Section 80.590 is revised to read as Ä tax-exempt use in accordance with
incorporation by reference of ASTM D follows:Ä section 4082 of the Internal Revenue
6299–02, Standard Practice for Code.’’
§ 80.590 What are the product transfer
Applying Statistical Quality Assurance (iii) Undyed 500 ppm sulfur diesel
document requirements for motor vehicle
Techniques to Evaluate Analytical diesel fuel, NRLM diesel fuel, heating oil fuel. From June 1, 2006 through
Measurement System Performance, as and other distillates? September 30, 2010, ‘‘500 ppm sulfur
prescribed in 5 U.S.C. 552(a) and 1 CFR (a) On each occasion that any person (maximum) Undyed Low Sulfur Diesel
part 51. Anyone may purchase copies of transfers custody or title to MVNRLM Fuel. For use in Model Year 2006 and
this standard from the American Society diesel fuel or heating oil, including older diesel highway vehicles and
for Testing and Materials, 100 Barr distillates used or intended to be used engines. Also for use in nonroad,
Harbor Dr., West Conshohocken, PA as MVNRLM diesel fuel or heating oil, locomotive, and marine diesel engines.
19428. Anyone may inspect copies at except when such fuel is dispensed into Not for use in model year 2007 and
the U.S. EPA, Air and Radiation Docket motor vehicles or nonroad, locomotive, newer highway vehicles or engines.’’
and Information Center, 1301 or marine equipment, the transferor (iv) Dyed 500 ppm sulfur diesel fuel.
Constitution Ave., NW., Room B102, must provide to the transferee (A) For the period of June 1, 2006
EPA West Building, Washington, DC documents which include the following through September 30, 2010, ‘‘500 ppm
20460 or at the National Archives and information: sulfur (maximum) Dyed Low Sulfur
Records Administration (NARA). For (1) The names and addresses of the Nonroad, Locomotive or Marine Diesel
information on the availability of this transferor and transferee. Fuel. Not for use in highway vehicles or
material at NARA, call 202–741–6030, (2) The volume of diesel fuel or engines except for use in Model Year
or go to: http://www.archives.gov/ distillate which is being transferred. 2006 and older highway diesel vehicles
federal_register/ (3) The location of the diesel fuel or or engines for tax-exempt use in
code_of_federal_regulations/ distillate at the time of the transfer. accordance with section 4082 of the
ibr_locations.html. (4) The date of the transfer. Internal Revenue Code.’’
(2) Follow paragraph 7.3.1 of ASTM D (5) For transfers of MVNRLM diesel (B) From June 1, 2010 through
6299–02 to check standards using a fuel, the sulfur content standard the September 30, 2014, ‘‘500 ppm sulfur
reference material at least monthly or transferor represents the fuel to meet. (maximum) Dyed Low Sulfur Nonroad
following any major change to the (6) Beginning June 1, 2006, when an Diesel Fuel. For use in model year 2010
laboratory equipment or test procedure. entity transfers custody of a distillate and older nonroad diesel engines. May
Any deviation from the accepted fuel designated under § 80.598, the be used in locomotive and marine diesel
reference value of a check standard following information must also be engines. Not for use in highway vehicles
greater than 1.44 ppm (for diesel fuel included: and engines or model year 2011 or later
subject to the 15 ppm sulfur standard) (i) The facility registration number of nonroad engines other than locomotive
or 19.36 ppm (for diesel fuel subject to the transferor issued under § 80.597, if or marine diesel engines. Not for use in
the 500 ppm sulfur standard) must be any. the Northeast/Mid-Atlantic Area.’’
investigated. (ii) An accurate and clear statement of (C) For dyed locomotive and marine
(3) Samples of tested batches must be the applicable designation and/or diesel fuel beginning June 1, 2010, ‘‘500
retained for 30 days or the period equal classification under § 80.598, for ppm sulfur (maximum) Dyed Low
to the interval between quality control example, 500 ppm sulfur NRLM diesel Sulfur Locomotive and Marine diesel
sample tests, whichever is longer. fuel; and whether the fuel is dyed or fuel. Not for use in highway or other
(4) Upon discovery of any quality nonroad vehicles and engines.’’
undyed, and for heating oil, whether
control testing violation of paragraph A (v) Dyed High Sulfur NRLM Fuel.
marked or unmarked.
1.5.1.3 or A 1.5.2.1 of ASTM D 6299– From June 1, 2007 through September
(7) For transfers of title or custody
02, or any check standard deviation 30, 2010, ‘‘High Sulfur Dyed Nonroad,
from one facility to another in the
greater than 1.44 ppm (for diesel fuel Locomotive, or Marine Engine Diesel
distribution system where diesel fuel or
subject to the 15 ppm sulfur standard) fuel—sulfur content may exceed 500
distillates are taxed, dyed or marked,
or 19.36 ppm (for diesel fuel subject to ppm sulfur. Not for use in highway
and for any subsequent transfers (except
the 500 ppm sulfur standard), conduct vehicles or engines. Not for use in any
when such fuel is dispensed into motor
an investigation into the cause of such nonroad engines requiring Ultra-Low
vehicles or nonroad, locomotive or
violation or deviation and, after Sulfur Diesel Fuel. Not for use in the
marine equipment), an accurate
restoring method performance to Northeast/Mid-Atlantic Area.’’
statement on the product transfer
statistical control, retest retained (vi) Heating oil. For heating oil
document of the applicable fuel uses
samples from batches originally tested produced or imported beginning June 1,
and classifications, as follows:
since the last satisfactory quality control 2007, ‘‘Heating Oil. Not for use in
(i) Undyed 15 ppm sulfur diesel fuel.
material or check standard testing highway vehicles or engines or nonroad,
For the period from June 1, 2006 and
occasion. locomotive, or marine engines.’’
beyond, ‘‘15 ppm sulfur (maximum)
■ 48. A new § 80.586 is added to read as
Undyed Ultra-Low Sulfur Diesel Fuel (b) The following may be substituted
follows:
For use in all diesel vehicles and for the descriptions in paragraph (a) of
§ 80.586 What are record retention engines.’’ From June 1, 2006 through this section, as appropriate:
requirements for test methods approved May 31, 2010, the product transfer (1) ‘‘This is high sulfur diesel fuel for
under this subpart? document must also state whether the use only in Guam, American Samoa, or
Each individual test facility must diesel fuel is #1D or #2D. the Northern Mariana Islands.’’;
retain records related to the (ii) Dyed 15 ppm sulfur diesel fuel. (2) ‘‘This diesel fuel is for export use
establishment of accuracy and precision From June 1, 2006 and beyond, ‘‘15 ppm only.’’;
(3) ‘‘This diesel fuel is for research, § 80.591 What are the product transfer the information required under
development, or testing purposes document requirements for additives to be paragraphs (a) and (b) of this section, if
only.’’; or used in diesel fuel? such codes are clearly understood by
(4) ‘‘This diesel fuel is for use in (a) Except as provided in paragraphs each transferee. Codes used to convey
diesel highway vehicles or nonroad (b) and (d) of this section, on each the statement in paragraph (a)(2) of this
equipment under an EPA-approved occasion that any person transfers section must contain the number ‘‘15’’
national security exemption only.’’ custody or title to a diesel fuel additive and codes used to convey the statement
that is subject to the provisions of in paragraph (b)(2) of this section must
(c) If undyed and/or unmarked
§ 80.521 to a party in the additive not contain such number.
distillate fuel is dyed and/or marked
distribution system or in the diesel fuel (d) For those diesel fuel additives
subsequent to the issuance of a product
distribution system for use downstream which are sold in containers for use by
transfer document, at the time the
of the diesel fuel refiner, the transferor the ultimate consumer of diesel fuel,
distillate fuel is dyed and/or marked, a
must provide to the transferee each transferor must have displayed on
new product transfer document must be
documents which identify the additive, the additive container, in a legible and
prepared with the language under
and— conspicuous manner, either of the
paragraph (a)(7) of this section
(1) Identify the name and address of following statements, as applicable:
applicable to the changed fuel and
the transferor and transferee; the date of (1) ‘‘This diesel fuel additive complies
provided to subsequent transferees.
transfer; the location at which the with the federal low sulfur content
(d) Except for transfers to truck transfer took place; the volume of
carriers, retailers or wholesale requirements for use in diesel motor
additive transferred; and vehicles and nonroad engines.’’; or
purchaser-consumers, product codes (2) Indicate compliance with the 15
may be used to convey the information (2) For those additives sold in
ppm sulfur standard by inclusion of the
required under this section if such containers for use by the ultimate
following statement: ‘‘The sulfur
codes are clearly understood by each consumer, with a sulfur content in
content of this diesel fuel additive does
transferee. Codes used to convey the excess of 15 ppm the following
not exceed 15 ppm.’’
statement in paragraphs (a)(7)(i) and (ii) (b) On each occasion that any person statement: ‘‘This diesel fuel additive
of this section must contain the number transfers custody or title to a diesel fuel does not comply with federal ultra-low
‘‘15’’, and codes used to convey the additive subject to the requirements of sulfur content requirements for use in
statement in paragraphs (a)(7)(iii) and § 80.521(b), to a party in the additive model year 2007 and newer diesel
(iv) of this section must contain the distribution system or in the diesel fuel motor vehicles or model year 2011 and
number ‘‘500’’. Codes used to convey distribution system for use in diesel fuel newer diesel nonroad equipment
the statement in paragraph (a)(7)(v) of downstream of the diesel fuel refiner, engines.’’
this section must contain the statement the transferor must provide to the ■ 51. Section 80.592 is amended by
‘‘greater than 500’’ or ‘‘>500’’. transferee documents which identify the revising the heading and paragraphs (a),
(e) From June 1, 2001 through May 31, additive, and do each of the following: (b) introductory text, (b)(4), (b)(7)
2005, any transfer subject to this (1) Identify the name and address of introductory text, (c), (d), and (e) to read
section, which is also subject to the the transferor and transferee; the date of as follows:
early credit provisions of § 80.531(b), transfer; the location at which the § 80.592 What records must be kept by
must comply with all applicable transfer took place; the volume of entities in the motor vehicle diesel fuel and
requirements of this section. additive transferred. diesel fuel additive distribution systems?
(f) From June 1, 2005 through May 31, (2) Indicate the high sulfur potential (a) Records that must be kept by
2006, any transfer subject to this of the additive by inclusion of the entities in the motor vehicle diesel fuel
section, which is also subject to the following statement: and diesel fuel additive distribution
early credit requirements of § 80.531(c), This diesel fuel additive may exceed the systems. Beginning June 1, 2006, or for
must comply with all applicable federal 15 ppm sulfur standard. Improper use a refiner or importer, the first
requirements of this section. of this additive may result in non-complying compliance period in which the refiner
(g) Mobile refuelers. The provisions of diesel fuel.
or importer is generating early credits
this section shall also apply to a mobile (3) If the additive contains a static under § 80.531(b) or (c), whichever is
refueler that dispenses fuel from tanker dissipater additive having a sulfur earlier, any person who produces,
trucks or other vessels into motor content greater than 15 ppm, include imports, sells, offers for sale, dispenses,
vehicles, nonroad diesel engines or the following statement: distributes, supplies, offers for supply,
nonroad diesel engine equipment. Each This diesel fuel contains a static dissipater stores, or transports motor vehicle diesel
visit by the mobile refueler to a location additive having a sulfur content greater than fuel subject to the provisions of this
shall be considered a separate occasion 15 ppm. subpart, must keep all the following
for purposes of paragraph (a) of this records:
(4) Include the following information:
section. The tank trucks used by mobile (1) The applicable product transfer
(i) The additive’s maximum sulfur
refuelers are not subject to the labeling documents required under §§ 80.590
concentration.
requirements in §§ 80.570 through (ii) The maximum recommended and 80.591.
80.574. concentration in volume percent for use (2) For any sampling and testing for
(h) Identifications of fuel designations of the additive in diesel fuel. sulfur content for a batch of motor
can be limited to a sub-designation that (iii) The contribution to the sulfur vehicle diesel fuel produced or
accurately identifies the fuel and do not level of the fuel, in ppm, that would imported and subject to the 15 ppm
need to also include the broader result if the additive is used at the sulfur standard or any sampling and
designation. For example, NR diesel fuel maximum recommended concentration. testing for sulfur content as part of a
does not also need to be designated as (c) Except for transfers of diesel fuel quality assurance testing program, and
NRLM or MVNRLM diesel fuel. additives to truck carriers, retailers or any sampling and testing for cetane
■ 50. Section 80.591 is revised to read as wholesale purchaser-consumers, index, aromatics content, solvent yellow
follows: product codes may be used to convey 124 content or dye solvent red 164
content of motor vehicle diesel fuel or section shall be kept for five years from be provided both for fuel produced from
motor vehicle diesel fuel additives: the date they were created, except that crude oil, as well as any fuel produced
(i) The location, date, time and storage records relating to credit transfers shall from other sources, and must be
tank or truck identification for each be kept by the transferor for 5 years from provided for the periods of June 1, 2006
sample collected; the date the credits were transferred, through December 31, 2006, January 1,
(ii) The name and title of the person and shall be kept by the transferee for 2007 through December 31, 2007,
who collected the sample and the 5 years from the date the credits were January 1, 2008 through December 31,
person who performed the testing; and transferred, used or terminated, 2008, January 1, 2009 through December
(iii) The results of the tests for sulfur whichever is later. 31, 2009, and January 1, 2010 through
content (including where applicable the (e) Make records available to EPA. On May 31, 2010, for each refinery and
test results with and without request by EPA, the records required in import facility;
application of the adjustment factor this section must be made available to * * * * *
under § 80.580(a)(4)) and for cetane the Administrator or the Administrator’s (5) Information on project schedule by
index or aromatics content (as representative. For records that are quarter of known or projected
applicable), and the volume of product electronically generated or maintained, completion date by the stage of the
in the storage tank or container from the equipment and software necessary
which the sample was taken. project, for example, following the five
to read the records shall be made project phases described in EPA’s June
(3) The actions the party has taken, if available, or if requested by EPA,
any, to stop the sale or distribution of 2002 Highway Diesel Progress Review
electronic records shall be converted to report (EPA420–R–02–016, http://
any motor vehicle diesel fuel found not paper documents which shall be
to be in compliance with the sulfur www.epa.gov/otaq/regs/hd2007/
provided to the Administrator’s 420r02016.pdf): Strategic planning,
standards specified in this subpart, and authorized representative.
the actions the party has taken, if any, Planning and front-end engineering,
■ 52. Section 80.593 is amended by Detailed engineering and permitting,
to identify the cause of any revising the section heading and
noncompliance and prevent future Procurement and construction, and
paragraphs (a)(3) and (c)(2) to read as Commissioning and startup;
instances of noncompliance. follows:
(b) Additional records to be kept by (6) Basic information regarding the
refiners and importers of motor vehicle § 80.593 What are the reporting selected technology pathway for
diesel fuel subject to hardship requirements for refiners and importers of compliance (e.g., conventional
standards, small refiner standards and motor vehicle diesel fuel subject to hydrotreating vs other technologies,
early credit provisions. Beginning June temporary refiner relief standards? revamp vs grassroots, etc.);
1, 2006, or for a refiner or importer, the * * * * * (7) Whether capital commitments
first compliance period in which the (a) * * * have been made or are projected to be
refiner or importer is generating early (3) The percentage of the volume of made; and
credits under § 80.531(b) or (c), any motor vehicle diesel fuel produced (8) The pre-compliance reports due
refiner producing motor vehicle diesel during the compliance period that met 2004 and 2005 must provide an update
fuel subject to the sulfur standard under the 15 ppm sulfur standard and the of the progress in each of these areas.
§ 80.520(a)(1), for each of its refineries, percentage that met the 500 ppm sulfur (b) Beginning on June 1, 2003, all
and any importer importing such motor standard prior to the application of any approved motor vehicle diesel fuel
vehicle diesel fuel, shall keep records volume credits. small refiners shall submit the following
that include the following information * * * * * additional information to EPA, as
for each batch of motor vehicle diesel (c) * * * applicable:
fuel produced or imported: * * * (2) Submitted to EPA no later than * * * * *
(4) A record designating the batch as August 31 for the prior annual Ä (2) In case of a refinery with an
motor vehicle diesel fuel meeting the compliance period.Ä approved application under § 80.552(c),
500 ppm sulfur standard or as motor ■ 53. Section 80.594 is amended by Ä a demonstration that by June 1, 2006 its
vehicle diesel fuel meeting the 15 ppm revising the section heading and Ä motor vehicle diesel fuel will be at 15
sulfur standard. paragraphs (a)(3), (a)(5), (b) introductory Ä ppm sulfur at a volume meeting the
* * * * * text, (b)(2), and (c), and adding Ä requirements of § 80.553(e).
(7) Information regarding credits, kept paragraphs (a)(6), (a)(7), (a)(8), and (e) to Ä (c) For each refiner and importer
separately for each calendar year read as follows:Ä approved under § 80.540, a
compliance period, kept separately for demonstration that by June 1, 2006, 95
each refinery and in the case of § 80.594 What are the pre-compliance percent of its motor vehicle diesel fuel
importers, kept separately for imports reporting requirements for motor vehicle will be at 15 ppm sulfur at a volume of
into each CTA, and designated as motor diesel fuel?
meeting the requirements of § 80.540(e).
vehicle diesel fuel credits and kept (a) Except as provided in paragraph
* * * * *
separately from NRLM credits, as (d) of this section, beginning on June 1,
(e) The pre-compliance reporting
follows: 2003, and on June 1, 2004 and June 1,
requirements of this section do not
* * * * * 2005, all refiners and importers
apply to refineries subject to the
(c) Additional records importers must planning to produce or import motor
provisions of § 80.513.
keep. Any importer shall keep records vehicle diesel fuel subject to the
that identify and verify the source of provisions of this subpart, shall submit
follows:
each batch of certified diesel fuel the following information to EPA:
program foreign refiner DFR-Diesel and * * * * * § 80.597 What are the registration
non-certified DFR-Diesel imported and (3) An estimate of the average daily requirements?
demonstrate compliance with the volumes (in gallons) of each sulfur grade The following registration
requirements under § 80.620. of motor vehicle diesel fuel produced requirements apply under this subpart:
(d) Length of time records must be (or imported) at each refinery (or import (a) Registration for motor vehicle
kept. The records required in this facility). These volume estimates must diesel fuel. Refiners having any refinery
that is subject to a sulfur standard under location of each of the components. If MVNRLM diesel fuel must also be
§ 80.520(a), and importers importing aggregation is changed for any designated as one of the following:
such diesel fuel, must provide EPA the subsequent compliance period, the (A) Motor vehicle diesel fuel; or
information under § 80.76, if such entity must provide notice to EPA prior (B) NRLM diesel fuel.
information has not been provided to the beginning of such compliance (iii) From June 1, 2010 through May
under the provisions of this part. In period. 31, 2012 any batch designated as NRLM
addition, for each import facility, the (2) If facility records are kept off-site, must also be designated as one of the
same identifying information as list the off-site storage facility name, following:
required for each refinery under physical location, contact name, and (A) NR diesel fuel; or
§ 80.76(c) must be provided. telephone number. (B) LM diesel fuel.
(b) Registration for NRLM diesel. (e) Changes to registration (iv) Until June 1, 2014, any batch
Refiners and importers that intend to information. Any company or entity designated as MVNRLM diesel fuel
produce or supply NRLM diesel fuel by shall submit updated registration must also be designated according to
June 1, 2007, must provide EPA the information to the Administrator within one of the following three sulfur level
information under § 80.76 no later than 30 days of any occasion when the specifications:
December 31, 2005, if such information registration information previously (A) 15 ppm if its sulfur content is less
has not been provided under the supplied for an entity, or any of its than or equal to 15 ppm.
provisions of this part. In addition, for registered facilities, becomes incomplete (B) 500 ppm if its sulfur content is
each import facility, the same or inaccurate. less than or equal to 500 ppm.
identifying information as required for (f) Issuance of registration numbers. (C) High Sulfur if its sulfur content is
each refinery under § 80.76(c) must be EPA will supply a registration number greater than 500 ppm.
provided. to each entity and a facility registration (v) From June 1, 2006 through May
(c) Entity registration. (1) Each entity number to each of an entity’s facilities 31, 2010, any batch designated as motor
as defined in § 80.502 that intends to that is identified, which shall be used in vehicle diesel fuel must also be
deliver or receive custody of any of the all reports to the Administrator. designated according to one of the
following fuels from June 1, 2007 ■ 55. A new § 80.598 is added to read as following two distillation classifications
through May 31, 2014 must register with follows: that most accurately represents the fuel:
EPA by December 31, 2005 or six (A) #1D.
§ 80.598 What are the designation
months prior to commencement of (B) #2D.
requirements for refiners, importers, and
producing, importing, or distributing distributors?
(3) The following restrictions and
any distillate subject to designation clarifications apply:
(a) Designation requirements for (i) Prior to June 1, 2006, any batch of
under § 80.598: refiners and importers. (1) Any refiner
(i) Fuel designated as 500 ppm sulfur MVNRLM not containing visible
or importer shall accurately and clearly evidence of red dye under § 80.520(b)
MVNRLM diesel fuel under § 80.598 on designate all fuel it produces or imports
which taxes have not been assessed must be designated as motor vehicle
for use in diesel motor vehicles as either diesel fuel.
pursuant to IRS code (26 CFR part 48). motor vehicle diesel fuel meeting the 15
(ii) Fuel designated as NRLM diesel (ii) Any distillate fuel containing
ppm sulfur standard under visible evidence of dye may not be
fuel under § 80.598 that is undyed § 80.520(a)(1) or as motor vehicle diesel
pursuant to § 80.520. designated as motor vehicle diesel fuel
fuel meeting the 500 ppm sulfur unless it is further designated as tax
(iii) Fuel designated as heating oil
standard under § 80.520(c). exempt motor vehicle diesel fuel.
under § 80.598 that is unmarked (2) Subject to the restrictions in
pursuant to § 80.510(d) through (f). (iii) Any distillate containing the
paragraph (a)(3) of this section, marker required pursuant to the
(iv) Fuel designated as LM diesel fuel
beginning June 1, 2006, any refiner or provisions of § 80.510(d) through (f)
under § 80.598(a)(2)(iii) that is
importer shall accurately and clearly must be designated as heating oil,
unmarked pursuant to § 80.510(e).
(2) Registration shall be on forms designate each batch of diesel fuel or except that from June 1, 2010 through
prescribed by the Administrator, and distillate fuel for which they transfer May 31, 2012 it may also be designated
shall include the name, business custody to another entity, according to as LM diesel fuel, pursuant to
address, contact name, telephone the following categories, including § 80.510(e).
number, e-mail address, and type of specifying its volume: (iv) Prior to June 1, 2009 all 15 ppm
(i) Designate the fuel as one of the
production, importation, or distribution sulfur MVNRLM diesel fuel must be
following fuel types:
activity or activities engaged in by the (A) Motor vehicle, nonroad, designated as motor vehicle diesel fuel.
entity. (v) Beginning June 1, 2010 any
locomotive or marine (MVNRLM) diesel
(3) Registration shall include the distillate fuel having a sulfur content
fuel;
information required under paragraph (B) Heating oil; greater than 15 ppm may not be
(d) of this section for each facility (C) Jet fuel; designated as motor vehicle diesel fuel.
owned or operated by the entity that (D) Kerosene; (vi) Beginning June 1, 2014, any
delivers or receives custody of a fuel (E) No. 4 fuel; distillate fuel having a sulfur content
described in paragraph (c)(1) of this (F) Distillate fuel for export only; or greater than to 15 ppm may not be
section. (G) Exempt distillate fuels such as designated as MVNRLM diesel fuel.
(d) Facility registration. (1) List for fuels that are covered by a national (vii) Any batch of #1D fuel which is
each separate facility of an entity security exemption under § 80.606, fuels suitable for use as MVNRLM and which
required to register under paragraph (c) that are used for purposes of research is also suitable for use as kerosene or jet
of this section, the facility name, and development pursuant to § 80.607, fuel (i.e., commonly referred to as dual
physical location, contact name, and fuels used in the U.S. Territories use kerosene) may be designated as
telephone number, e-mail address and pursuant to § 80.608 (including MVNRLM, kerosene, or jet fuel (as
type of facility. For facilities that are additional identifying information). applicable).
aggregated under § 80.502, provide (ii) From June 1, 2006 through May (viii) Beginning June 1, 2007, any
information regarding the nature and 31, 2014 any batch designated as distillate fuel with a sulfur content
greater than 500 ppm distributed or is in their custody between receipt and (i) 500 ppm sulfur NR diesel fuel;
intended for distribution in the area delivery. (ii) 500 ppm sulfur LM diesel fuel;
specified in § 80.510(g)(1), may not be (2) From June 1, 2006 through May (iii) Heating oil; or
designated as MVNRLM diesel fuel. 31, 2009, whenever custody of a batch (iv) Exempt distillate fuels such as
(ix) From June 1, 2010 through May of 15 ppm sulfur motor vehicle diesel fuels that are covered by a national
31, 2012, any distillate fuel with a sulfur fuel is transferred to another facility, the security exemption under § 80.606, fuels
content greater than 15 ppm distributed entity transferring custody must that are used for purposes of research
or intended for distribution in the area accurately and clearly designate the and development pursuant to § 80.607,
specified in § 80.510(g)(1), may not be batch as one of the following and and fuels used in the U.S. Territories
designated as NR diesel fuel. specify its volume: pursuant to § 80.608 (including
(x) From June 1, 2012 through May (i) #1D 15 ppm sulfur motor vehicle additional identifying information).
31, 2014, any distillate fuel with a sulfur diesel fuel. (7) From June 1, 2012 through May
content greater than 15 ppm distributed (ii) #2D 15 ppm sulfur motor vehicle 31, 2014, whenever custody of a batch
or intended for distribution in the area diesel fuel. of distillate fuel (other than jet fuel,
specified in § 80.510(g)(1), may not be (3) From June 1, 2009 through May kerosene, No. 4 fuel, or fuel for export)
designated as NRLM diesel fuel. 31, 2010, whenever custody of a batch having a sulfur content greater than 15
(xi) Beginning June 1, 2007, any of 15 ppm sulfur MVNRLM diesel fuel ppm is transferred to another facility,
distillate fuel with a sulfur content is transferred to another facility, the the entity transferring custody must
greater than 500 ppm distributed or entity transferring custody must accurately and clearly designate the
intended for distribution in the area accurately and clearly designate the batch as one of the following and
specified in § 80.510(g)(2) may not be batch as one of the following and specify its volume:
designated as NRLM diesel fuel unless specify its volume: (i) 500 ppm sulfur NRLM diesel fuel;
EPA has first approved a compliance (i) #1D 15 ppm sulfur motor vehicle (ii) Heating oil; or
plan for the refiner for segregating the diesel fuel. (iii) Exempt distillate fuels such as
fuel from all other types of NRLM diesel (ii) #2D 15 ppm sulfur motor vehicle fuels that are covered by a national
fuel from the refinery gate to the diesel fuel. security exemption under § 80.606, fuels
ultimate consumer, as specified under (iii) 15 ppm sulfur NRLM diesel fuel. that are used for purposes of research
§ 80.554(a)(4). (4) From June 1, 2006 through May and development pursuant to § 80.607,
(xii) From June 1, 2010 through May 31, 2010, whenever custody of a batch and fuels used in the U.S. Territories
31, 2012, any distillate fuel with a sulfur of undyed, 500 ppm sulfur MVNRLM is pursuant to § 80.608 (including
content greater than 15 ppm distributed transferred to another facility, the entity additional identifying information).
or intended for distribution in the area transferring custody must accurately (8) Beginning June 1, 2014, whenever
specified in § 80.510(g)(2) may not be and clearly designate the batch as one custody of a batch of distillate fuel
designated as NR diesel fuel unless EPA of the following and specify its volume: (other than jet fuel, kerosene, No. 4 fuel,
has first approved a compliance plan for (i) #1D 500 ppm sulfur motor vehicle
or fuel for export) having a sulfur
the refiner for segregating the fuel from diesel fuel;
(ii) #2D 500 ppm sulfur motor vehicle content greater than 15 ppm is
all other types of NRLM diesel fuel from transferred to another facility, the entity
diesel fuel; or
the refinery gate to the ultimate (iii) 500 ppm sulfur NRLM diesel fuel. transferring custody must accurately
consumer, as specified under (5) From June 1, 2007 through May and clearly designate the batch as one
§ 80.554(b)(4). 31, 2010, whenever custody of a batch of the following and specify its volume:
(xiii) From June 1, 2012 through May of distillate fuel (other than jet fuel, (i) 500 ppm sulfur LM diesel fuel;
31, 2014, any distillate fuel with a sulfur kerosene, No. 4 fuel, or fuel for export) (ii) Heating oil; or
content greater than 15 ppm distributed having a sulfur content greater than 500 (iii) Exempt distillate fuels such as
or intended for distribution in the area ppm is transferred to another facility, fuels that are covered by a national
specified in § 80.510(g)(2) may not be the entity transferring custody must security exemption under § 80.606, fuels
designated as NRLM diesel fuel unless, accurately and clearly designate the that are used for purposes of research
EPA has first approved a compliance batch as one of the following and and development pursuant to § 80.607,
plan for the refiner for segregating the specify its volume: and fuels used in the U.S. Territories
fuel from all other types of NRLM diesel (i) High sulfur NRLM diesel fuel pursuant to § 80.608 (including
fuel from the refinery gate to the (HSNRLM); additional identifying information).
ultimate consumer, as specified under (ii) Heating oil; or (9) The following restrictions and
§ 80.554(b)(4). (iii) Exempt distillate fuels such as clarifications apply. Subject to the
(xiv) Beginning June 1, 2014, any fuels that are covered by a national provisions of this paragraph (b)(9) and
distillate fuel with a sulfur content security exemption under § 80.606, fuels subject to the dye and marker provisions
greater than 15 ppm may not be that are used for purposes of research of § 80.520(b) and § 80.510(d) through
designated as MVNRLM diesel fuel. and development pursuant to § 80.607, (f), when custody of a batch of distillate
(b) Designation requirements for fuel and fuels used in the U.S. Territories fuel is transferred, the designation
distributors. (1) Pursuant to the pursuant to § 80.608 (including provided by the entity transferring
provisions of paragraphs (b)(2) through additional identifying information). custody pursuant to paragraphs (b)(1)
(b)(9) of this section, beginning June 1, (6) From June 1, 2010 through May through (b)(8) of this section may be
2006, any distributor shall accurately 31, 2012, whenever custody of a batch different from the designation of the fuel
and clearly designate each batch of of distillate fuel (other than jet fuel, when that same entity received custody.
diesel fuel or distillate fuel for which kerosene, No. 4 fuel, or fuel for export) (i) Any 500 ppm sulfur diesel fuel
they transfer custody to another facility, having a sulfur content greater than 15 designated under this paragraph (b) and
including specifying its volume, as ppm is transferred to another facility, containing visible evidence of red dye
specified in this paragraph (b). the entity transferring custody must may not be designated as motor vehicle
Distributors must also accurately and accurately and clearly designate the diesel fuel.
clearly classify such diesel fuel and batch as one of the following and (ii) Any distillate fuel containing
distillate fuel by sulfur content, while it specify its volume: greater than or equal to 0.10 milligrams
per liter of marker solvent yellow 124 the facility is also greater than the (xii) Notwithstanding the provisions
required under § 80.510(d), (e), or (f) volume it received by an equal or of paragraphs (b)(7) and (8) of this
must be designated as heating oil except greater proportion, as calculated in section, beginning October 1, 2012—
that from June 1, 2010 through October § 80.599(c)(2); and (A) No distillate fuel with a sulfur
1, 2012 it may also be designated as LM (B) Beginning June 1, 2010, for any content greater than 15 ppm distributed
diesel fuel as specified under compliance period, the volume of fuel or intended for distribution in the areas
§ 80.510(e). designated as heating oil delivered from specified in § 80.510(g)(1) and (g)(2),
(iii) Any batch of #1D fuel which is a facility cannot be less than the volume may be designated as NRLM diesel fuel,
suitable for use as MVNRLM diesel fuel of fuel designated as heating oil including LM diesel fuel, except as
and which is also suitable for use as received, as calculated in § 80.599(c)(4). provided in paragraph (b)(9)(xv) of this
kerosene or jet fuel (i.e., commonly (ix) For facilities in areas other than section; and
referred to as dual use kerosene) may be those specified in § 80.510(g)(1) and (B) Distillate fuel with a sulfur
designated as either MVNRLM diesel (g)(2), from June 1, 2010 through May content greater than 15 ppm distributed
fuel, kerosene, or jet fuel (as applicable). 31, 2012, batches or portions of batches from within the areas specified in
(iv) Any MVNRLM diesel fuel with a received designated as 500 ppm LM § 80.510(g)(1) and (g)(2) to areas outside
sulfur content of 500 ppm or less in diesel fuel may be redesignated as 500 these areas is subject to the provisions
inventory as of June 1, 2007 may be ppm NR diesel fuel only if for any of paragraphs (b)(7) and (8) of this
designated as motor vehicle diesel fuel. compliance period the following section.
(v) Batches or portions of batches of restrictions are met: (xiii) From June 1, 2007 through
fuel received designated as 15 ppm September 30, 2010, in the area
(A) The volume of fuel designated as
sulfur #2D motor vehicle diesel fuel specified in § 80.510(g)(2) only
500 ppm sulfur NR diesel fuel delivered
may be re-designated as 500 ppm sulfur segregated batches of distillate fuel
from the facility cannot be greater than
motor vehicle diesel fuel, but only in received designated as HSNRLM diesel
the volume received as calculated in
accordance with the limitations of fuel may be distributed designated as
§ 80.599(d)(2)(i); or
§ 80.527(c). HSNRLM diesel fuel and must remain
(B) The volume of fuel designated as
(vi) Batches or portions of batches segregated from fuel with any other
500 ppm sulfur NR diesel fuel delivered designations unless otherwise approved
received designated as 500 ppm sulfur
from the facility in relation to the by EPA in a refiner compliance plan
NRLM diesel fuel may be re-designated
volume received is not a greater under § 80.554(a)(4).
as 500 ppm sulfur motor vehicle diesel
proportion than the volume of fuel (xiv) From June 1, 2010 through
fuel by a truck loading terminal only if
designated as 500 ppm sulfur LM diesel September 30, 2012, in the area
the terminal maintains a neutral or
fuel delivered from the facility in specified in § 80.510(g)(2) only
positive balance at the end of each
relation to the volume received, as segregated batches of distillate fuel
quarterly compliance period on their
calculated in § 80.599(d)(2)(ii). received designated as 500 ppm sulfur
motor vehicle diesel fuel volume from
(x) Notwithstanding the provisions of NR diesel fuel may be distributed
June 1, 2007 as calculated in
paragraph (b)(5) of this section, designated as 500 ppm sulfur NR diesel
§ 80.599(b)(4).
(vii) Batches or portions of batches beginning October 1, 2007, fuel and must remain segregated from
received designated as 500 ppm sulfur (A) No distillate fuel with a sulfur fuel with any other designations and
NRLM diesel fuel may be re-designated content greater than 500 ppm from any other 500 ppm sulfur NRLM
as 500 ppm sulfur motor vehicle diesel distributed or intended for distribution diesel fuel from any other sources,
fuel by a facility other than a truck in the areas specified in § 80.510(g)(1) except as approved by EPA in a refiner
loading terminal only if the following and (g)(2), may be designated as NRLM compliance plan under § 80.554(a)(4).
restrictions are met: diesel fuel, including LM diesel fuel (xv) From June 1, 2012 through
(A) At the end of each annual except as provided in paragraph September 30, 2014, in the area
compliance period, the facility has a (b)(9)(xiii) of this section; and specified in § 80.510(g)(2) only
neutral or positive balance on its motor (B) Distillate fuel with a sulfur segregated batches of distillate fuel
vehicle diesel fuel volume from June 1, content greater than 500 ppm received designated as 500 ppm sulfur
2007 as calculated in § 80.599(b)(4); and distributed from within the areas NRLM diesel fuel may be distributed
(B) At the end of each annual specified in § 80.510(g)(1) and (g)(2) to designated as 500 ppm sulfur NRLM
compliance period, the facility’s balance areas outside these areas is subject to diesel fuel and must remain segregated
for motor vehicle diesel fuel volume, the provisions of paragraph (b)(5) of this from fuel with any other designations
from the beginning of the compliance section. and from any other 500 ppm sulfur
period must be less than two percent of (xi) Notwithstanding the provisions of NRLM diesel fuel from any other
the total volume of motor vehicle diesel paragraphs (b)(6) through (b)(8) of this sources, except as approved by EPA in
fuel received during the compliance section, beginning October 1, 2010— a refiner compliance plan under
period, as calculated in § 80.599(b)(5). (A) No distillate fuel with a sulfur § 80.554(a)(4).
(viii) For facilities in areas other than content greater than 15 ppm distributed (c) Notwithstanding the provisions of
those specified in § 80.510(g)(1) and or intended for distribution in the areas paragraph (b) of this section, an entity
(g)(2), batches or portions of batches of specified in § 80.510(g)(1) and (g)(2), is not required to designate heating oil
unmarked distillate received designated may be designated as NR diesel fuel, that is delivered from a facility that only
as heating oil may be re-designated as except as provided in paragraph receives heating oil which is marked
NRLM or LM diesel fuel only if the (b)(9)(xiv) of this section; and pursuant to § 80.510(d) through (f).
following restrictions are met: (B) Distillate fuel with a sulfur (d) Notwithstanding the provisions of
(A) From June 1, 2007 through May content greater than 15 ppm distributed paragraph (b)(4) of this section, an entity
31, 2010, for any compliance period, the from within the areas specified in is not required to designate 500 ppm
volume of high sulfur NRLM diesel fuel § 80.510(g)(1) and (g)(2) to areas outside sulfur MVNRLM diesel fuel that is
delivered from a facility cannot be these areas is subject to the provisions delivered from a facility that only
greater than the volume received, unless of paragraphs (b)(6) through (b)(7) of receives 500 ppm sulfur MVNRLM
the volume of heating oil delivered from this section. diesel fuel on which taxes have been
paid or into which red dye has been diesel fuel volume balance is calculated beginning of the program on June 1,
added pursuant to § 80.520(b). as follows: 2007. Any #2D 500 ppm sulfur
(e) Notwithstanding the provisions of MVNRLM in inventory at the beginning
MVB = MVI¥MVO¥MVINVCHG of the program on June 1, 2007 may be
paragraph (b)(6) of this section, an entity
Where: designated as motor vehicle diesel fuel.
is not required to designate 500 ppm sMVB = the sum of the balances for motor
MVB = the volume balance for motor vehicle
sulfur LM diesel fuel that is delivered diesel fuel for the compliance period. vehicle diesel fuel for the current
from a facility that only receives 500 MVI = the total volume of all batches of fuel compliance period and previous
ppm sulfur LM diesel fuel which is designated as motor vehicle diesel fuel compliance periods.
marked pursuant to § 80.510(e). received for the compliance period. (5) The volume balance required for
(f) Any entity that is both a distributor MVO = the total volume of all batches of fuel purposes of compliance with
and a refiner or importer must comply designated as motor vehicle diesel fuel
§ 80.598(b)(9)(vii)(B) means:
with the provisions of paragraph (a) of delivered for the compliance period.
this section for all distillate fuel MVINVCHG = the total volume of 15 ppm ¥MVB ≤ 0.02 × MVI
produced or imported, and the sulfur and 500 ppm sulfur motor vehicle (6) Calculations in paragraphs (b)(4)
diesel fuel in inventory at the end of the
provisions of paragraph (b) of this compliance period minus the total
and (b)(5) of this section may be
section for all distillate fuel for which volume of 15 ppm sulfur and 500 ppm combined for all facilities wholly owned
it acted as distributor but not refiner or sulfur motor vehicle diesel fuel in by an entity.
importer. inventory at the beginning of the (7) For purposes of calculations in
(g) No refiner, importer, or distributor compliance period, including accounting paragraphs (b)(1) through (b)(5) of this
may use the designation provisions of for any corrections in inventory due to section, for batches of fuel received from
this section to circumvent the standards volume swell or shrinkage, difference in facilities without an EPA facility ID#,
or requirements of § 80.510, 80.511, or measurement calibration between any batches of fuel received on which
80.520.Ä receiving and delivering meters, and taxes have been paid pursuant to IRS
similar matters, where corrections that
■ 56. A new § 80.599 is added to read as Ä code (26 CFR part 48) shall be deemed
increase inventory are defined as
follows:Ä positive. to be MV15I or MV500I as appropriate
for purposes of this paragraph.
§ 80.599 How do I calculate volume (2) Calculate the motor vehicle diesel (c) Volume balance for high sulfur
balances for designation purposes? fuel received, as follows: NRLM diesel fuel and heating oil. (1) A
(a) Quarterly compliance periods. The MVI = MV15I + MV500I facility’s high sulfur NRLM balance is
quarterly compliance periods are shown calculated as follows:
Where:
in the following table:
MV15I = the total volume of all batches of HSNRLMB = HSNRLMII ¥ HSNRLMO ¥
fuel designated as 15 ppm sulfur motor HSNRLMINVCHG
Beginning date of Ending date of
quarterly compliance quarterly compliance vehicle diesel fuel received for the Where:
period period compliance period.
MV500I = the total volume of all batches of HSNRLMB = the balance for high sulfur
fuel designated as 500 ppm sulfur motor NRLM diesel fuel for the compliance
June 1, 2007 ............. September 30, 2007. period.
October 1, 2007 ........ December 31, 2007. vehicle diesel fuel received for the
HSNRLMI = the total volume of all batches
January 1, 2008 ........ March 31, 2008. compliance period.
of fuel designated as high sulfur NRLM
April 1, 2008 .............. June 30, 2008. (3) Calculate the motor vehicle diesel received diesel fuel for the compliance
July 1, 2008 .............. September 30, 2008. period.
fuel delivered, as follows:
October 1, 2008 ........ December 31, 2008. HSNRLMO = the total volume of all batches
January 1, 2009 ........ March 31, 2009. MVO = MV15O + MV500O of fuel designated as high sulfur NRLM
April 1, 2009 .............. June 30, 2009. Where: diesel fuel delivered for the compliance
July 1, 2009 .............. September 30, 2009. MV15O = the total volume of all batches of period.
October 1, 2009 ........ December 31, 2009. fuel designated as 15 ppm sulfur motor HSNRLMINVCHG = the volume of high sulfur
January 1, 2010 ........ March 31, 2010. vehicle diesel fuel and delivered during NRLM diesel fuel in inventory at the end
April 1, 2010 .............. May 31, 2010. the compliance period. of the compliance period minus the
June 1, 2010 ............. September 30, 2010. MV500O = the total volume of all batches of volume of high sulfur NRLM diesel fuel
fuel designated as 500 ppm sulfur motor in inventory at the beginning of the
(1) Annual compliance periods. The vehicle diesel fuel and delivered during compliance period, including accounting
annual compliance periods before the the compliance period. for any corrections in inventory due to
period beginning July 1, 2015 are shown volume swell or shrinkage, difference in
(4) The neutral or positive volume measurement calibration between
balance required for purposes of receiving and delivering meters, and
Beginning date of Ending date of compliance with § 80.598(b)(9)(vi) and similar matters, where corrections that
annual compliance annual compliance (b)(9)(vii)(A) means that the net balance increase inventory are defined as
period period of motor vehicle diesel fuel in inventory positive.
as of the end of the last day of the (2) The volume balance required for
June 1, 2007 ............. June 30, 2008. compliance period (MVNBE) must be
July 1, 2008 .............. June 30, 2009. purposes of compliance with
greater than or equal to zero. MVNBE is § 80.598(b)(9)(viii)(A) means one of the
July 1, 2009 .............. May 31, 2010.
June 1, 2010 ............. June 30, 2011. defined by the following equation: following:
July 1, 2011 .............. May 31, 2012. MVNBE = MV15BINV + MV500BINV sMVB (i) HSNRLMB ≥ 0
June 1, 2012 ............. June 30, 2013. Where: (ii) (HSNRLMO + HSNRLMINVCHG) /
July 1, 2013 .............. May 31, 2014. HSNRLMI ≤ (HOO + HOINVCHG) / HOI
MV15BINV = the total volume of fuel
June 1, 2014 ............. June 30, 2015.
designated as 15 ppm sulfur motor (3) A facility’s heating oil volume
vehicle diesel fuel in inventory at the balance is calculated as follows:
(2) The annual compliance periods for beginning of the program on June 1,
the period beginning July 1, 2015 shall 2007. HOB = HOI ¥ HOO ¥ HOINVCHG
be from July 1, through June 30. MV500BINV = the total volume of fuel Where:
(b) Volume balance for motor vehicle designated as 500 ppm sulfur motor HOB = the balance for heating oil for the
diesel fuel. (1) A facility’s motor vehicle vehicle diesel fuel in inventory at the compliance period.
HOI = the total volume of all batches of fuel receiving and delivering meters, and #2MV500O ≤ #2MV500I ¥ #2MV500INVCHG +
designated as heating oil received for the similar matters, where corrections that 0.2 × #2MV15I
compliance period. increase inventory are defined as Where:
HOO = the total volume of all batches of fuel positive. #2MV500O = the total volume of fuel
designated as heating oil delivered to all (2) The volume balance required for delivered during the compliance period
downstream entities for the compliance that is designated as #2D 500 ppm sulfur
period. purposes of compliance with
motor vehicle diesel fuel.
HOINVCHG = the volume of heating oil in § 80.598(b)(9)(ix) means one of the
#2MV500I = the total volume of fuel received
inventory at the end of the compliance following: during the compliance period that is
period minus the volume of heating oil (i) NR500B ≥ 0 designated as #2D 500 ppm sulfur motor
in inventory at the beginning of the (ii) (NR500O + NR500INVCHG) / NR500I ≤ vehicle diesel fuel.
compliance period, including accounting (LM500O + LM500INVCHG) / LM500I. #2MV500INVCHG = the total volume of diesel
for any corrections in inventory due to Where: fuel designated as #2D 500 ppm sulfur
volume swell or shrinkage, difference in motor vehicle diesel fuel in inventory at
measurement calibration between LM500I = the total volume of all batches of
fuel designated as 500 ppm sulfur LM the end of the compliance period minus
receiving and delivering meters, and the total volume of #2D 500 ppm sulfur
similar matters, where corrections that diesel fuel received for the compliance
period. motor vehicle diesel fuel in inventory at
increase inventory are defined as the beginning of the compliance period,
positive. LM500O = the total volume of all batches of
fuel designated as 500 ppm sulfur LM and accounting for any corrections in
(4) The volume balance required for diesel fuel delivered for the compliance inventory due to volume swell or
purposes of compliance with period. shrinkage, difference in measurement
LM500INVCHG = the volume of 500 ppm calibration between receiving and
§ 80.598(b)(9)(viii)(B) means: delivering meters, and similar matters,
sulfur LM diesel fuel in inventory at the
HOB ≤ 0 end of the compliance period minus the where corrections that increase
(5) Calculations in paragraphs (c)(3) volume of 500 ppm sulfur LM diesel fuel inventory are defined as positive.
and (c)(4) of this section may be in inventory at the beginning of the (4) The following calculation may be
combined for all facilities wholly owned compliance period, and accounting for used to account for wintertime blending
any corrections in inventory due to of kerosene:
by an entity. volume swell or shrinkage, difference in
(6) For purposes of calculations in measurement calibration between #2MV500O ≤ #2MV500I ¥ #2MV500INVCHG +
paragraphs (c)(1) through (c)(4) of this receiving and delivering meters, and 0.2 * (#1MV15I + #2MV15I)
section, for batches of fuel received from similar matters, where corrections that Where:
facilities without an EPA facility ID#, increase inventory are defined as #1MV15I = the total volume of fuel received
any batches of fuel received marked positive. during the compliance period that is
pursuant to § 80.510(d) or (f) shall be (e) Anti-downgrading for motor designated as #1D 15 ppm sulfur motor
deemed to be HOI, any batches of fuel vehicle diesel fuel. (1) A facility must vehicle diesel fuel.
received marked pursuant to § 80.510(e) satisfy the provisions in either (5) The following calculation may be
shall be deemed to be HOI or LM500I, paragraphs (e)(2), (e)(3), (e)(4), or (e)(5) used to account for wintertime blending
any diesel fuel with less than or equal of this section to comply with the anti- of kerosene and/or changes in the
to 500 ppm sulfur that is dyed pursuant downgrading limitation of paragraph facility’s volume balance of motor
to § 80.520(b) and not marked pursuant § 80.527(c)(1), for the annual vehicle diesel fuel resulting from a
to § 80.510(d) or (f) shall be deemed to compliance periods defined in temporary shift of 500 ppm sulfur
be NRLM diesel fuel, and any diesel fuel § 80.527(c)(3). NRLM diesel fuel to 500 ppm sulfur
with less than or equal to 500 ppm (2) The volume of #2D 15 ppm sulfur motor vehicle diesel fuel during the
sulfur which is dyed pursuant to motor vehicle delivered must meet the compliance period:
§ 80.520(b) and not marked pursuant to following requirement: #2MV500O < #2MV500I ¥ #2MV500INVCHG +
§ 80.510(e) shall be deemed to be NR (#2MV15O + #2MV15INVCHG) ≥ 0.8 × #2MV15I 0.2 * #2MV15I + #1MV15B +
diesel fuel. #2NRLM500S
Where:
(d) Volume balance for NR diesel fuel. Where:
(1) A facility’s 500 ppm nonroad diesel #2MV15O = the total volume of fuel delivered
during the compliance period that is #1MV15B = the total volume of fuel received
fuel balance is calculated as follows: designated as #2D 15 ppm sulfur motor during the compliance period that is
NR500B = NR500I ¥ NR500O ¥ vehicle diesel fuel. designated as #1D 15 ppm sulfur motor
NR500INVCHG #2MV15INVCHG = the total volume of diesel vehicle diesel fuel and that the facility
Where: fuel designated as #2D 15 ppm sulfur can demonstrate they blended into #2D
motor vehicle diesel fuel in inventory at 500 ppm sulfur motor vehicle diesel fuel.
NR500B = the balance for 500 ppm sulfur NR
the end of the compliance period minus #2NRLM500S = the total volume of #2D 500
diesel fuel for the compliance period.
the total volume of #2D 15 ppm sulfur ppm sulfur NRLM diesel fuel that the
NR500I = the total volume of all batches of
motor vehicle diesel fuel in inventory at facility can demonstrate they
fuel designated as 500 ppm sulfur NR
the beginning of the compliance period, redesignated as #2D 500 ppm sulfur
diesel fuel received for the compliance
and accounting for any corrections in motor vehicle diesel fuel during the
period. inventory due to volume swell or compliance period.
NR500O = the total volume of all batches of shrinkage, difference in measurement
fuel designated as 500 ppm sulfur NR calibration between receiving and (f) Inventory adjustments.
diesel fuel delivered for the compliance delivering meters, and similar matters, Adjustments to inventory under this
period. where corrections that increase section must be based on normal
NR500INVCHG = the volume of 500 ppm sulfur inventory are defined as positive. business practices for the industry,
NR diesel fuel in inventory at the end of #2MV15I = the total volume of fuel received appropriate physical plant operations
the compliance period minus the volume during the compliance period that is
of 500 ppm sulfur NR diesel fuel in
and use of good engineering judgments.
designated as #2D 15 ppm sulfur motor (g) Unique circumstances. EPA may,
inventory at the beginning of the vehicle diesel fuel.
compliance period, and accounting for at its discretion, grant a fuel
any corrections in inventory due to (3) The volume of #2D 500 ppm sulfur distributor’s application to modify its
volume swell or shrinkage, difference in motor vehicle diesel fuel delivered must inventory of motor vehicle diesel fuel,
measurement calibration between meet the following requirement: NRLM diesel fuel, or heating oil for a
given compliance period. EPA may Ä paragraphs (a)(6) through (a)(10) of this entity and facility to which the fuel was
grant an application to address unique Ä section for each batch of heating oil that delivered.
circumstances, where appropriate, such Ä it transfers custody of and designates (9) Notwithstanding the provisions of
as the start up of a new pipeline or Ä during the time period from June 1, paragraphs (a)(6) and (a)(7) of this
pipeline segment.Ä 2014 and later as belonging to the section, records of heating oil batches
■ 57. The center header ‘‘EXEMPTIONS’’
heating oil category. delivered that have been properly
before § 80.600 is removed.Ä (6) The records for each batch with marked pursuant to § 80.510(d) through
■ 58. Section 80.600 is revised to read as Ä designations identified in paragraphs (f) and records of LM diesel fuel batches
follows:Ä (a)(1) through (a)(5) of this section must delivered that have been properly
clearly and accurately identify the batch marked pursuant to § 80.510(e) are not
§ 80.600 What records must be kept for number (including an indication as to required to be maintained separately for
purposes of the designate and track whether the batch was received into the
provisions?
each entity and facility to which the fuel
facility or delivered from the facility), was delivered.
(a) In addition to the requirements of date and time of day (if multiple batches (10) Any refiner or importer shall
§ 80.592 and § 80.602, the following are delivered per day) that custody was maintain copies of all product transfer
recordkeeping requirements shall apply transferred, the designation, the volume documents required under § 80.590. If
to refiners and importers: in gallons of the batch, and the name all information required in paragraph
(1) Any refiner or importer shall and the EPA entity and facility (a)(6) of this section is on the product
maintain the records specified in registration number of the facility to transfer document for a batch, then the
paragraphs (a)(6) through (a)(10) of this whom such batch was transferred. provisions of this paragraph (a)(10) shall
section for each batch of distillate fuel (i) For motor vehicle diesel fuel, the satisfy the requirements of paragraph
that it transfers custody of and records must also identify whether the (a)(6) of this section for that batch.
designates during the time period from batch was received or delivered with or (11) Any refiner or importer shall
June 1, 2006 through May 31, 2010, with without taxes paid pursuant to Section maintain records related to annual
the following categories: 4082 of the Internal Revenue Code (26 compliance calculations performed
(i) #1D 15 ppm sulfur motor vehicle U.S.C. 4082). under § 80.599 and to information
diesel fuel; (ii) For NRLM diesel fuel, the records required to be reported to the
(ii) #2D 15 ppm sulfur motor vehicle must also identify whether the batch Administrator under § 80.601.
diesel fuel; was received or delivered with or (12) Records must be maintained that
(iii) 15 ppm sulfur NRLM diesel fuel; without dye added pursuant to Section demonstrate compliance with a refiner’s
(iv) #1D 500 ppm sulfur motor vehicle 4082 of the Internal Revenue Code (26 compliance plan required under
diesel fuel; U.S.C. 4082). § 80.554, for distillate fuel designated as
(v) #2D 500 ppm sulfur motor vehicle (iii) For heating oil, the records must high sulfur NRLM diesel fuel and
diesel fuel; or also identify whether the batch was delivered from June 1, 2007 through
(vi) 500 ppm sulfur NRLM diesel fuel. received or delivered with or without May 31, 2010, for distillate fuel
(2) Any refiner or importer shall the marker added pursuant to designated as 500 ppm sulfur NR diesel
maintain the records specified in § 80.510(d) through (f). fuel and delivered from June 1, 2010
paragraphs (a)(6) through (a)(10) of this (iv) For LM diesel, the records must through May 31, 2012, and for distillate
section for each batch of distillate fuel also identify whether the batch was fuel designated as 500 ppm sulfur
that it transfers custody of and received or delivered with or without NRLM diesel fuel and delivered from
designates during the time period from the marker added pursuant to June 1, 2012 through June 1, 2014 in the
June 1, 2007 through May 31, 2010 with § 80.510(e). areas specified in § 80.510(g)(2).
the following categories: (7) Any refiner or importer shall, for (b) In addition to the requirements of
(i) High sulfur NRLM diesel fuel; or each of its facilities, maintain records § 80.592 and § 80.602, the following
(ii) Heating oil. that clearly and accurately identify the recordkeeping requirements shall apply
(3) Any refiner or importer shall total volume in gallons of designated to distributors:
maintain the records specified in fuel identified in paragraphs (a)(1) (1) Any distributor shall maintain the
paragraphs (a)(6) through (a)(10) of this through (a)(5) of this section transferred records specified in paragraphs (b)(2)
section for each batch of distillate fuel over each compliance period. The through (b)(10) of this section for each
that it transfers custody of and records shall be maintained separately batch of distillate fuel with the
designates during the time period from for each fuel designated in paragraphs following designations for which
June 1, 2010 through May 31, 2012 with (a)(1) through (a)(5) of this section, and custody is received or delivered.
the following categories: for each EPA entity and facility Records shall be kept separately for each
(i) 500 ppm sulfur NR diesel fuel; registration number to whom custody of of its facilities.
(ii) 500 ppm sulfur LM diesel fuel; or the fuel was transferred. (i) For each facility that receives #2D
(iii) Heating oil. (8) Notwithstanding the provisions of 15 ppm sulfur motor vehicle diesel fuel
(4) Any refiner or importer shall paragraphs (a)(6) and (a)(7) of this and distributes any #2D 500 ppm sulfur
maintain the records specified in section, records of batches delivered of motor vehicle diesel fuel, records for
paragraphs (a)(6) through (a)(10) of this 500 ppm sulfur motor vehicle diesel each batch of diesel fuel with the
section for each batch of distillate fuel fuel on which taxes have been paid per following designations for which
that it transfers custody of and Section 4082 of the Internal Revenue custody is received or delivered during
designates during the time period from Code (26 U.S.C. 4082) and of 500 ppm the time period from June 1, 2006
June 1, 2012 through May 31, 2014 with sulfur NRLM diesel fuel into which dye through May 31, 2007:
the following categories: has been added per Section 4082 of the (A) #1D 15 ppm sulfur motor vehicle
(i) 500 ppm sulfur NRLM diesel fuel; Internal Revenue Code (26 U.S.C. 4082), diesel fuel;
or and of 500 ppm sulfur LM diesel fuel (B) #2D 15 ppm sulfur motor vehicle
(ii) Heating oil. which has been properly marked diesel fuel;
(5) Any refiner or importer shall pursuant to § 80.510(e) are not required (C) #2D 500 ppm sulfur motor vehicle
maintain the records specified in to be maintained separately for each diesel fuel; or
(D) 500 ppm sulfur NRLM diesel fuel. (A) 500 ppm sulfur NRLM diesel fuel; under paragraph (b)(1) of this section,
(ii) For each facility, records for each or and for each EPA entity and facility
batch of diesel fuel with the following (B) Heating oil. registration number from whom the fuel
designations for which custody is (2) Records that for each batch clearly was received or to whom it was
received or delivered during the time and accurately identify the batch delivered. For batches of fuel received
period from June 1, 2007 through May number (including an indication as to from facilities without an EPA facility
31, 2010: whether the batch was received into the registration number, any batches of fuel
(A) #1D 15 ppm sulfur motor vehicle facility or delivered from the facility), received marked pursuant to § 80.510(d)
diesel fuel; date and time of day (if multiple batches or (f) shall be deemed designated as
(B) #2D 15 ppm sulfur motor vehicle are delivered per day) that custody was heating oil, any batches of fuel received
diesel fuel; transferred, the designation, the volume marked pursuant to § 80.510(e) shall be
(C) #1D 500 ppm sulfur motor vehicle in gallons of each batch of each fuel, deemed designated as heating oil or LM
diesel fuel; and the name and the EPA entity and diesel fuel, any batches of fuel received
(D) #2D 500 ppm sulfur motor vehicle facility registration number of the on which taxes have been paid pursuant
diesel fuel; facility to whom or from whom such to Section 4082 of the Internal Revenue
(E) 500 ppm sulfur NRLM diesel fuel; batch was transferred. Code (26 U.S.C. 4082) shall be deemed
(F) 15 ppm sulfur NRLM diesel fuel; (i) For motor vehicle diesel fuel the designated as motor vehicle diesel fuel,
(G) High sulfur NRLM diesel fuel; or records must also identify whether the any 500 ppm sulfur diesel fuel dyed
(H) Heating oil. batch was received or delivered with or pursuant to § 80.520(b) and not marked
(iii) For each facility that receives without taxes paid pursuant to section pursuant to § 80.510(d) or (f) shall be
unmarked fuel designated as NR diesel 4082 of the Internal Revenue Code (26 deemed designated as NRLM diesel fuel,
fuel, LM diesel fuel or heating oil, U.S.C. 4082). and any diesel fuel with less than or
records for each batch of diesel fuel (ii) For NRLM diesel fuel, the records equal to 500 ppm sulfur which is dyed
with the following designations for must also identify whether it was pursuant to § 80.520(b) and not marked
which custody is received or delivered received or delivered with or without pursuant to § 80.510(e) shall be deemed
during the time period from June 1, dye added pursuant to Section 4082 of to be NR diesel fuel.
2010 through May 31, 2012: the Internal Revenue Code (26 U.S.C. (4) Notwithstanding the provisions of
(A) 500 ppm sulfur NR diesel fuel; 4082). paragraphs (b)(2) and (b)(3) of this
(B) 500 ppm sulfur LM diesel fuel; or (iii) For heating oil, the records must
(C) Heating oil. section, for batches of 500 ppm sulfur
also identify whether it was received or motor vehicle diesel fuel delivered on
(iv) For each facility that receives delivered with or without the marker
unmarked fuel designated as heating oil, which taxes have been paid per Section
added pursuant to § 80.510(d) through 4082 of the Internal Revenue Code (26
records for each batch of diesel fuel (f).
with the following designations for U.S.C. 4082) and 500 ppm sulfur NRLM
(iv) For LM diesel fuel, the records diesel fuel into which red dye has been
which custody is received or delivered must also identify whether it was
during the time period from June 1, added per Section 4082 of the Internal
received or delivered with or without Revenue Code (26 U.S.C. 4082), records
2012 through May 31, 2014: the marker added pursuant to
(A) 500 ppm sulfur NRLM diesel fuel; are not required to be maintained
§ 80.510(e). separately for each entity or facility to
or (v) For batches of fuel received from
(B) Heating oil. whom fuel was delivered.
facilities without an EPA facility (5) Notwithstanding the provisions of
(v) For each facility that receives
registration number, any batches of fuel paragraphs (b)(2) and (b)(3) of this
unmarked fuel designated as heating oil,
received marked pursuant to § 80.510(d) section, for batches of heating oil
records for each batch of diesel fuel
or (f) shall be deemed designated as delivered that are marked pursuant to
with the following designations for
heating oil, any batches of fuel received § 80.510(d) through (f), records do not
which custody is received or delivered
marked pursuant to § 80.510(e) shall be need to identify the EPA entity or
during the time period beginning June 1,
deemed designated as heating oil or LM facility registration number to which
2014:
diesel fuel, any batches of fuel received fuel was delivered.
(A) 500 ppm sulfur LM diesel fuel; or
(B) Heating oil. on which taxes have been paid pursuant (6) Notwithstanding the provisions of
(vi) From June 1, 2007 through May to Section 4082 of the Internal Revenue paragraphs (b)(2) and (b)(3) of this
31, 2010, for those facilities in the areas Code (26 U.S.C. 4082) shall be deemed section, for batches of LM diesel fuel
specified in § 80.510(g)(2) that receive designated as motor vehicle diesel fuel, delivered that are marked pursuant to
unmarked fuel designated as high sulfur any 500 ppm sulfur diesel fuel dyed § 80.510(e), records do not need to
NRLM diesel fuel: pursuant to § 80.520(b) and not marked identify the EPA entity or facility
(A) High sulfur NRLM diesel fuel; or pursuant to § 80.510(d) or (f) shall be registration number to which fuel was
(B) Heating oil. deemed designated as NRLM diesel fuel, delivered.
(vii) From June 1, 2010 through May and any diesel fuel with less than or (7) Records that clearly and accurately
31, 2012, for those facilities in the areas equal to 500 ppm sulfur which is dyed reflect the beginning and ending
specified in § 80.510(g)(2) that receive pursuant to § 80.520(b) and not marked inventory volume for each of the fuels
unmarked fuel designated as 500 ppm pursuant to § 80.510(e) shall be deemed for which records must be kept under
sulfur NR diesel fuel, 500 ppm sulfur to be NR diesel fuel. paragraph (b)(1) of this section. Such
LM diesel fuel, or heating oil: (3) Records that clearly and accurately records shall be maintained separately
(A) 500 ppm sulfur NR diesel fuel; identify the total volume in gallons of by each entity and facility consistent
(B) 500 ppm sulfur LM diesel fuel; or each designated fuel identified under with the compliance periods defined in
(C) Heating oil. paragraph (b)(1) of this section §§ 80.598 and 80.599.
(viii) From June 1, 2012 through May transferred over each of the compliance (8) (i) If adjustments are made to
31, 2014, for those facilities in the areas periods, and over the periods from June inventory, the records must include
specified in § 80.510(g)(2) that receive 1, 2007 to the end of each compliance detailed information related to the
unmarked fuel designated as 500 ppm period. The records shall be maintained amount, type of, and reason for such
sulfur NRLM diesel fuel or heating oil. separately for each fuel designated adjustment.
(ii) If adjustments are made because of § 80.554, unless otherwise allowed by marked pursuant to § 80.510(d) or (f)
measurement error or variation, the EPA. shall be deemed designated as heating
records must include the adjustment (h) For purposes of this section, each oil, any batch of distillate fuel for which
made, the meter or gauge or other portion of a shipment of designated custody is received and which is
reading(s), and the name of the person distillate fuel under this section that is marked pursuant to § 80.510(e) shall be
who took such reading(s) and or applied differently designated from any other deemed designated as heating oil or LM
the adjustment. portion, even if shipped as fungible diesel fuel as applicable, and the report
(9) For distributors that are required product having the same sulfur content, shall include that information under
to keep records under paragraphs (b)(1) shall be a separate batch. that designation.
through (b)(8) of this section for truck (i) The records required in this section (ii) Any batch of distillate fuel for
loading terminals, records related to must be made available to the which custody is received and for
quarterly or annual compliance Administrator or the Administrator’s which taxes have been paid pursuant to
calculations, as applicable, performed designated representative upon request. Section 4082 of the Internal Revenue
under § 80.599 and to information (j) Notwithstanding the provisions of Code (26 U.S.C. 4082) shall be deemed
required to be reported to the this section, product transfer documents designated as motor vehicle diesel fuel
Administrator under § 80.601. must be maintained under the and the report shall include it under
(10) For distributors that are required provisions of §§ 80.590, 80.592, and that designation.
to keep records under paragraphs (b)(1) 80.602. (iii) Any batch of 500 ppm sulfur
through (b)(8) of this section for (k) The records required in this diesel fuel dyed pursuant to § 80.520(b)
facilities other than truck loading section must be kept for five years after and not marked pursuant to § 80.510(d)
terminals, records related to annual they are required to be collected. and (f), and for which custody is
compliance calculations performed (l) Identifications of fuel designations received, shall be deemed designated as
under § 80.599 and to information can be limited to a sub-designation that NRLM diesel fuel and the report shall
required to be reported to the accurately identifies the fuel and do not include it under that designation.
Administrator under § 80.601. need to also include the broader (iv) Any batch of 500 ppm sulfur
(c) Notwithstanding the provisions of designation. For example, NR diesel fuel diesel fuel dyed pursuant to § 80.520(b)
paragraph (b) of this section, records of does not also need to be designated as and not marked pursuant to § 80.510(e),
heating oil received are not required to NRLM or MVNRLM diesel fuel. and for which custody is received, shall
be maintained for facilities that do not ■ 59. Section 80.601 is revised to read as be deemed designated as NR diesel fuel
receive any heating oil which is follows: and the report shall include it under
unmarked pursuant to § 80.510(d) that designation.
through (f), or LM diesel fuel which is § 80.601 What are the reporting (4) In the case of truck loading
unmarked pursuant to § 80.510(e). requirements for purposes of the designate
terminals, the results of all compliance
(d) Notwithstanding the provisions of and track provisions?
calculations required under § 80.599,
paragraph (b) of this section, records of (a) Quarterly reporting. Beginning and including:
500 ppm sulfur MVNRLM diesel fuel November 30, 2007 and continuing (i) The total volumes received of each
received are not required to be through August 31, 2010, each entity fuel designation required to be reported
maintained for facilities that do not required to maintain records under in paragraphs (a)(1) through (a)(3) of this
receive any motor vehicle diesel fuel for § 80.600 must report the following section over the quarterly compliance
which taxes have not already been paid information separately for each of its period.
pursuant to Section 4082 of the Internal facilities to the Administrator on a (ii) The total volumes delivered of
Revenue Code (26 U.S.C. 4082) or quarterly basis, as specified in each fuel designation required to be
NRLM diesel fuel which is undyed paragraph (e)(1) of this section: reported in paragraphs (a)(1) through
pursuant to § 80.520(b). (1) Separately for each designation (a)(3) of this section over the quarterly
(e) The provisions of paragraphs category and separately for each compliance period.
(b)(1)(iii) and (iv) of this section do not transferee facility, the total volume in (iii) Beginning and ending inventories
apply to facilities located in the areas gallons of distillate fuel designated of each fuel designation required to be
specified in § 80.510(g)(1) and (g)(2) under § 80.598 for which custody was reported in paragraphs (a)(1)
unless they deliver marked heating oil delivered by the reporting facility to any through(a)(3) of this section over the
or LM diesel fuel to areas outside the other entity or facility, and the EPA quarterly compliance period.
areas specified in § 80.510(g)(1) and entity and facility registration (iv) The volume balance under
(g)(2). number(s), as applicable, of the § 80.599(b)(4) and § 80.598(b)(9)(vi).
(f) Ultimate consumers that receive transferee. (v) The volume balance under
any batch of high sulfur NRLM diesel (2) Separately for each designation § 80.599(c)(2) and § 80.598(b)(9)(viii)(A).
fuel beginning June 1, 2007 in areas category and separately for each (b) Annual reports. Beginning August
listed in § 80.510(g)(2) must maintain transferor facility, the total volume in 31, 2007, all entities required to
records of each batch of fuel received for gallons of distillate fuel designated maintain records for batches of fuel
use in NRLM equipment pursuant to the under § 80.598 for which custody was under § 80.600 must report the
compliance plan provisions of § 80.554, received by the reporting facility, and following information separately for
unless otherwise allowed by EPA. the EPA entity and facility registration each of its facilities to the Administrator
(g) Ultimate consumers that receive number(s), as applicable, of the on an annual basis, as specified in
any batch of 500 ppm sulfur NR diesel transferor. paragraph (e)(2) of this section:
fuel beginning June 1, 2010 or NRLM (3) Any entity that receives custody of (1) Separately for each designation
diesel fuel beginning June 1, 2012 in the distillate fuel from another entity or category for which records are required
areas listed in § 80.510(g)(2) must facility that does not have an EPA to be kept under § 80.600 and separately
maintain records of each batch of fuel facility identification number must for each transferor facility, the total
received for use in NR or NRLM report such batches as follows: volume in gallons of distillate fuel
equipment, as appropriate, pursuant to (i) Any batch of distillate fuel for designated under § 80.598 for which
the compliance plan provisions of which custody is received and which is custody was received by the reporting
facility, and the EPA entity and facility balance under § 80.598(b)(9)(ix) and (2) For any sampling and testing for
registration number(s), as applicable, of § 80.599(d)(2). sulfur content for a batch of NRLM
the transferor. (c) Additional information. The diesel fuel produced or imported and
(2) Separately for each designation Administrator may request any subject to the 15 ppm sulfur standard or
category for which records are required additional information necessary to any sampling and testing for sulfur
to be kept under § 80.600 and separately determine compliance with the content as part of a quality assurance
for each transferee facility, the total requirements of §§ 80.598 and 80.599. testing program, and any sampling and
volume in gallons of distillate fuel (d) Submission of quarterly and testing for cetane index, aromatics
designated under § 80.598 for which annual reports. (1) All quarterly reports content, marker solvent yellow 124
custody was delivered by the reporting shall be submitted to the Administrator content or dye solvent red 164 content
facility to any other entity or facility, for the compliance periods defined in of NRLM diesel fuel, NRLM diesel fuel
and the EPA entity and facility § 80.599(a)(1) as follows: additives or heating oil:
registration number(s), as applicable, of (i) The first quarter report shall be (i) The location, date, time and storage
the transferee except as provided under submitted by the following November tank or truck identification for each
§ 80.600(a)(7), (a)(8), (b)(4), and (b)(5). 30. sample collected;
(3) The results of all compliance (ii) The second quarter report shall be (ii) The name and title of the person
calculations required under § 80.599, submitted by the following February 28. who collected the sample and the
and including: (iii) The third quarter report shall be person who performed the testing; and
(i) The total volumes in gallons submitted by the following May 31. (iii) The results of the tests for sulfur
received of each fuel designation (iv) The fourth quarter report shall be content (including where applicable the
required to be reported in paragraph submitted by the following August 31. test results with and without
(b)(1) of this section over the applicable (2) All annual reports shall be application of the adjustment factor
annual compliance period. submitted to the Administrator for the under § 80.580(a)(4)), for cetane index or
(ii) The total volumes in gallons compliance periods defined in aromatics content, dye solvent red 164,
delivered of each fuel designation § 80.599(a)(2) by August 31. marker solvent yellow 124 (as
required to be reported in paragraph (3) All reports shall be submitted on applicable), and the volume of product
(b)(2) of this section over the applicable forms and following procedures in the storage tank or container from
annual compliance period. specified by the Administrator, shall which the sample was taken.
(iii) Beginning and ending inventories include a statement that volumes (3) The actions the party has taken, if
of each fuel designation required to be reported to the Administrator under this any, to stop the sale or distribution of
reported in paragraphs (b)(1) and (b)(2) section are identical to volumes any NRLM diesel fuel found not to be
of this section for the annual reported to the Internal Revenue Service in compliance with the sulfur standards
compliance period. and shall be signed and certified by a specified in this subpart, and the actions
(iv) In the areas specified in responsible corporate officer of the the party has taken, if any, to identify
§ 80.510(g)(2), for fuel designated as reporting entity. the cause of any noncompliance and
high sulfur NRLM diesel fuel delivered (e) Exclusions. Notwithstanding the prevent future instances of
from June 1, 2007 through May 31, provisions of this section, an entity is noncompliance.
2010, for fuel designated as 500 ppm NR not required to report under paragraphs (b) Additional records to be kept by
diesel fuel delivered from June 1, 2010 (a) or (b) of this section for facilities refiners and importers of NRLM diesel
through May 31, 2012, and for fuel whose only recordkeeping requirements fuel. Beginning June 1, 2007, or June 1,
designated as 500 ppm sulfur NRLM under § 80.600 are under § 80.600 (f) or 2006, pursuant to the provisions of
diesel fuel from June 1, 2012 through (g) or to maintain records solely related § 80.535 or § 80.554(d), any refiner
May 31, 2014, the refiner must report all to calculating compliance with the producing diesel fuel subject to a sulfur
information required under its downgrading limitation under § 80.527, standard under § 80.510, § 80.513,
compliance plan approved pursuant to § 80.599(e) and § 80.600(b)(1)(i) and (ii). § 80.536, § 80.554, § 80.660, or § 80.561,
§ 80.554(a)(4) and (b)(4) and including for each of its refineries, and any
the ultimate consumers to whom each follows: importer importing such diesel fuel
batch of fuel was delivered and the total § 80.602 What records must be kept by separately for each facility, shall keep
delivered to each ultimate consumer for entities in the NRLM diesel fuel and diesel records that include the following
the compliance period. fuel additive production, importation, and information for each batch of NRLM
(v) Ending with the report due August distribution systems? diesel fuel or heating oil produced or
31, 2010, the volume balance under (a) Records that must be kept by imported:
§ 80.598(b)(9)(vi) and § 80.599(b)(4). parties in the NRLM diesel fuel and (1) The batch volume.
(vi) Ending with the report due diesel fuel additive production, (2) The batch number, assigned under
August 31, 2010, the volume balance importation, and distribution systems. the batch numbering procedures under
under § 80.598(b)(9)(vii) and Beginning June 1, 2007, or June 1, 2006, § 80.65(d)(3).
§ 80.599(b)(5), if applicable. if that is the first period credits are (3) The date of production or import.
(vii) Ending with the report due generated under § 80.535, any person (4) A record designating the batch as
August 31, 2010, the volume balance who produces, imports, sells, offers for one of the following:
under § 80.598(b)(9)(viii)(A) and sale, dispenses, distributes, supplies, (i) NRLM diesel fuel, NR diesel fuel,
§ 80.599(c)(2). offers for supply, stores, or transports LM diesel fuel, or heating oil, as
(viii) Beginning with the report due nonroad, locomotive or marine diesel applicable.
August 31, 2010, the volume balance fuel subject to the provisions of this (ii) Meeting the 500 ppm sulfur
under § 80.598(b)(8)(viii)(B) and subpart, must keep the following standard of § 80.510(a) or the 15 ppm
§ 80.599(c)(4). records: sulfur standard of § 80.510(b) and (c) or
(ix) Beginning with the report due (1) The applicable product transfer other applicable standard.
August 1, 2011 and ending with the documents required under §§ 80.590 (iii) Dyed or undyed with visible
report due August 1, 2012, the volume and 80.591. evidence of solvent red 164.
(iv) Marked or unmarked with solvent paper documents which shall be Ä (c) The pre-compliance reporting
yellow 124. provided to the Administrator’s Ä requirements of this section do not
(5) For foreign refiners and importers authorized representative.Ä apply to refineries subject to the
of their fuel, the designations and other ■ 61. A new § 80.603 is added to read as Ä provisions of § 80.513.
records required to be kept under follows:Ä ■ 62. A new § 80.604 is added to read as
§ 80.620. follows:
§ 80.603 What are the pre-compliance
(6) All of the following information
reporting requirements for NRLM diesel § 80.604 What are the annual reporting
regarding credits, kept separately for fuel?
each compliance period, kept separately requirements for refiners and importers of
(a) Except as provided in paragraph NRLM diesel fuel?
for each refinery and for each importer
(c) of this section, beginning on June 1, Beginning with the annual
facility, kept separately if converted
2005, and for each year until June 1, compliance period that begins June 1,
under § 80.535(a) and (b) or § 80.535(c)
2011, or until the entity produces or 2007, or the first period during which
and (d), and kept separately from motor
imports NR or NRLM diesel fuel credits are generated, transferred or
vehicle diesel fuel credits: meeting the 15 ppm sulfur standard of
(i) The number of credits in the used, or the first period during which
§ 80.510(b) or (c), all refiners and NRLM diesel fuel or heating oil is
refiner’s or importer’s possession at the
importers planning to produce or import produced under a small refiner
beginning of the calendar year.
NR or NRLM diesel fuel, shall submit compliance option under this subpart,
(ii) The number of credits generated.
(iii) The number of credits used. the following information to EPA: whichever is earlier, any refiner or
(iv) If any were obtained from or (1) Any changes to the information
importer who produces or imports
transferred to other parties, for each submitted for the company registration;
(2) Any changes to the information NRLM diesel fuel must submit annual
other party, its name, its EPA refiner or compliance reports for each refinery and
submitted for any refinery or import
importer registration number consistent importer facility that contain the
facility registration;
with § 80.597, and the number obtained (3) Any estimate of the average daily following information required, and
from, or transferred to, the other party. volumes (in gallons) of each sulfur grade such other information as EPA may
(v) The number in the refiner’s or of motor vehicle and NRLM diesel fuel require.
importer’s possession that will carry produced (or imported) at each refinery (a) All refiners and importers. (1) The
over into the subsequent calendar year (or import facility). These volume refiner or importer’s company name and
compliance period. estimates must be provided both for fuel the EPA company and facility
(vi) Commercial documents that produced from crude oil, as well as any identification number.
establish each transfer of credits from fuel produced from other sources, and (2) If the refiner is a small refiner, a
the transferor to the transferee. must be provided for the periods of June statement regarding to which small
(7) The calculations used to determine refiner option it is subject.
1, 2010 through December 31, 2010,
baselines or compliance with the (b) Small refiners. (1) For each
calendar years 2011 through 2013,
volume requirements and volume January 1, 2014 through May 31, 2014, refinery of small refiners subject to the
percentages, as applicable, under this and June 1, 2014 through December 31, provisions of § 80.551(g) and § 80.554(a)
subpart. 2014; for each compliance period from June 1,
(8) The calculations used to determine (4) If expecting to participate in the 2007 through May 31, 2010, report the
the number of credits generated. credit trading program, estimates of the following:
(9) A copy of reports submitted to number of credits to be generated and/
EPA under § 80.604. (i) The total volume of diesel fuel
or used each year the program; produced and designated as NRLM
(c) Additional records importers must (5) Information on project schedule by
keep. Any importer shall keep records diesel fuel.
quarter of known or projected (ii) The volume of diesel fuel
that identify and verify the source of completion date by the stage of the
each batch of certified DFR-Diesel and produced and designated as NRLM
project, for example, following the five diesel fuel having a sulfur content less
non-certified DFR-Diesel imported and project phases described in EPA’s June
demonstrate compliance with the than or equal to the 500 ppm sulfur
2002 Highway Diesel Progress Review standard under § 80.510(a).
requirements under § 80.620. report (EPA420-R–02–016, http://
(d) Length of time records must be (iii) The total volume of diesel fuel
www.epa.gov/otaq/regs/hd2007/ produced and designated as NRLM
kept. The records required in this 420r02016.pdf): Strategic planning,
section shall be kept for five years from diesel fuel having a sulfur content
Planning and front-end engineering, greater than the 500 ppm sulfur
the date they were created, except that Detailed engineering and permitting,
records relating to credit transfers shall standard under § 80.510(a).
Procurement and construction, and
be kept by the transferor for five years (iv) The total volume of heating oil
Commissioning and startup;
from the date the credits were produced.
(6) Basic information regarding the
transferred, and shall be kept by the selected technology pathway for (v) The baseline under § 80.554(a)(1).
transferee for five years from the date compliance (e.g., conventional (vi) The total volume of diesel fuel
the credits were transferred, used or hydrotreating vs. other technologies, produced and designated as NRLM
terminated, whichever is later. revamp vs. grassroots, etc.); diesel fuel that is exempt from the 500
(e) Make records available to EPA. On (7) Whether capital commitments ppm sulfur standard of § 80.510(a).
request by EPA, the records required in have been made or are projected to be (vii) The total volume, if any, of
this section must be made available to made; and NRLM diesel fuel subject to the 500
the Administrator or the Administrator’s (8) The pre-compliance reports due in ppm sulfur standard § 80.510(a) that had
representative. For records that are 2006 and later years must provide an a sulfur content exceeding 500 ppm.
electronically generated or maintained, update of the progress in each of these (2) For each refinery of small refiners
the equipment and software necessary areas. subject to the provisions of § 80.551(g)
to read the records shall be made (b) Reports under this section may be and § 80.554(b), for each compliance
available, or if requested by EPA, submitted in conjunction with reports period between June 1, 2010 and May
electronic records shall be converted to submitted under § 80.594. 31, 2012, report the following:
(i) The total volume of diesel fuel (iv) The deficit, if any, and the corporate officer of the refiner or
produced and designated as NR diesel number of credits purchased, if any, to importer; and
fuel. cover any deficit as provided in (3) Except for small refiners subject to
(ii) The total volume of diesel fuel § 80.554(d)(3). § 80.554(d), submitted to EPA no later
produced and designated as LM diesel (v) A report of the small refiner’s than August 31 each year for the prior
fuel. progress toward compliance with the annual compliance period. Small
(iii) The total volume of diesel fuel gasoline standards under §§ 80.240 and refiners subject to the provisions of
produced and designated as NR diesel 80.255. § 80.554(d), reports must be submitted
fuel subject to the 500 ppm sulfur (c) Credit generation and use. August 31 for the previous reporting
standard under § 80.510(a). Information regarding the generation, period.
(iv) The total volume of diesel fuel use, transfer and retirement of credits, (4) With the exception of reports
produced and designated as LM diesel separately by refinery and import required under paragraph (b)(3) of this
fuel subject to the 500 ppm sulfur facility, including the following: section, no reports will be required
standard under § 80.510(a). (1) The number of credits at the under this section after August 31, 2014.
(v) The volume of diesel fuel beginning of the compliance period. ■ 63. A center heading is added after
produced and designated as NR diesel (2) The number of credits generated. § 80.604 to read as follows:
fuel having a sulfur content of 15 ppm (3) The number of credits used. Exemptions
or less. (4) If any credits were obtained from
(vi) The baseline under § 80.554(b)(1). or transferred to other refineries or ■ 64. A new § 80.606 is added to read as
(vii) The total volume of NRLM diesel importers, for each other refinery or follows:
fuel produced that is eligible for the importer, the name, address, the EPA § 80.606 What national security exemption
sulfur standard under § 80.510(a). (viii) company identification number, and the applies to distillate fuel?
The total volume, if any, of NRLM number of credits obtained from or (a) The motor vehicle diesel fuel
diesel fuel subject to the 15 ppm sulfur transferred to the other party. standards of § 80.520(a)(1), (a)(2), and
standard that had a sulfur content in (5) The number of credits retired. (c) and the nonroad, locomotive or
excess of 15 ppm. (6) The credit balance at the beginning marine diesel fuel standards of
(3) For each refinery of small refiners and end of the compliance period. § 80.510(a), (b), and (c) do not apply to
subject to the provisions of § 80.551(g) (d) Batch reports. For each batch of distillate fuel that is produced,
and § 80.554(b), for each compliance NRLM diesel fuel and heating oil (if imported, sold, offered for sale,
period between June 1, 2012 and May applicable) produced or imported and supplied, offered for supply, stored,
31, 2014, report the following: delivered during the compliance dispensed, or transported for use in—
(i) The total volume of diesel fuel periods under paragraph (b) of this (1) Tactical military motor vehicles or
produced and designated as NRLM section, include the following: tactical military nonroad engines,
diesel fuel. (1) The batch volume. vehicles or equipment, including
(ii) The total volume diesel fuel (2) The batch number assigned using locomotive and marine, having an EPA
produced and designated as NRLM the batch numbering conventions under national security exemption from the
diesel fuel subject to the 500 ppm sulfur § 80.65(d)(3) and the appropriate motor vehicle emissions standards
standard under § 80.510(a). designation under § 80.598. under 40 CFR 85.1708, or from the
(iii) The total volume of diesel fuel (3) The date of production or import. nonroad engine emission standards
produced and designated as NRLM (4) For each batch provide the under 40 CFR part 89, 40 CFR part 92,
diesel fuel having a sulfur content less information specified in paragraph (a)(1) 40 CFR part 94, or 40 CFR part 1068;
than or equal to the 15 ppm sulfur of this section. and
standard under § 80.510(c). (5) The sulfur content and cetane and (2) Tactical military motor vehicles or
(iv) The baseline under § 80.554(b)(1). aromatics content of the fuel. tactical military nonroad engines,
(v) The total volume of NRLM diesel (6) Whether the batch was dyed with vehicles or equipment, including
fuel produced that is eligible for the 500 visible evidence of dye solvent red 164 locomotive and marine, that are not
ppm sulfur standard under § 80.510(a). before leaving the refinery or import subject to a national security exemption
(vi) The total volume, if any, of NRLM facility or was undyed. from vehicle or engine emissions
diesel fuel subject to the 15 ppm sulfur (7) Whether the batch was marked standards as described in paragraph
standard that had a sulfur content in with marker solvent yellow 124 before (a)(1) of this section but, for national
excess of 15 ppm. leaving the refinery or import facility or security purposes (for purposes of
(4) For each refinery of a small refiner was unmarked. readiness for deployment oversees),
that elects to produce NRLM diesel fuel (e) Additional reporting requirements need to be fueled on the same fuel as the
subject to the 15 ppm sulfur standard of for importers. Importers of NRLM diesel vehicles, engines, or equipment for
§ 80.510(c) beginning June 1, 2006 fuel are subject to the following which EPA has granted such a national
under § 80.551(g) and § 80.554(d), for additional requirements: security exemption.
each compliance period report the (1) The reporting requirements under (b) The exempt fuel must meet the
following: § 80.620, if applicable. following conditions:
(i) The total volume of diesel fuel (2) Importers must exclude certified (1) It must be accompanied by
produced and designated as NRLM DFR–Diesel from calculations under this product transfer documents as required
diesel fuel. section. under § 80.590;
(ii) The total volume of diesel fuel (f) Report submission. Any report (2) It must be segregated from non-
produced and designated as NRLM required by this section must be— exempt MVNRLM diesel fuel at all
diesel fuel having a sulfur content less (1) On forms and following points in the distribution system;
than or equal to 15 ppm. procedures specified by the (3) It must be dispensed from a fuel
(iii) The percentages of NRLM diesel Administrator of EPA; pump stand, fueling truck or tank that
fuel produced and designated having a (2) Signed and certified as meeting all is labeled with the appropriate
sulfur content less than or equal to 15 the applicable requirements of this designation of the fuel, such as ‘‘JP–5’’
ppm under § 80.554(d)(1)(i) and (ii). subpart by the owner or a responsible or ‘‘JP–8’’; and
(4) It may not be used in any motor (3) To demonstrate the reasonableness (3) The research and development
vehicles or nonroad engines, equipment of the scope of the program: diesel fuel must be kept segregated from
or vehicles, including locomotive and (i) An estimate of the program’s non-exempt MVNRLM diesel fuel at all
marine, other than the vehicles, engines, duration in time and, if appropriate, points in the distribution system.
and equipment referred to in paragraph mileage; (4) The research and development
(a) of this section. (ii) An estimate of the maximum diesel fuel must not be sold, distributed,
■ 65. A new § 80.607 is added to read as number of vehicles or engines involved offered for sale or distribution,
follows: in the program; dispensed, supplied, offered for supply,
(iii) The manner in which the transported to or from, or stored by a
§ 80.607 What are the requirements for
obtaining an exemption for diesel fuel used information on vehicles and engines diesel fuel retail outlet, or by a
for research, development or testing used in the program will be recorded wholesale purchaser-consumer facility,
purposes? and made available to the Administrator unless the wholesale purchaser-
(a) Written request for a research and upon request; and consumer facility is associated with the
development exemption. Any person (iv) The quantity of diesel fuel which research and development program that
may receive an exemption from the does not comply with the requirements uses the diesel fuel.
provisions of this subpart for diesel fuel of §§ 80.520 and 80.521 for motor (5) At the completion of the program,
used for research, development, or vehicle diesel fuel or § 80.510 for NRLM any emission control systems or
testing purposes by submitting the diesel fuel. elements of design which are damaged
information listed in paragraph (c) of (4) With regard to control, a or rendered inoperative shall be
this section to: demonstration that the program affords replaced on vehicles remaining in
EPA a monitoring capability, including service, or the responsible person will
Director, Transportation and Regional
Programs Division (6406J), U.S. the following: be liable for a violation of the Clean Air
Environmental Protection Agency, 1200 (i) The site(s) of the program Act section 203(a)(3) (42 U.S.C. 7522
Pennsylvania Avenue, NW., Washington, (including facility name, street address, (a)(3)) unless sufficient evidence is
DC 20460 (postal mail); or city, county, state, and zip code); supplied that the emission controls or
Director, Transportation and Regional (ii) The manner in which information elements of design were not damaged.
Programs Division, U.S. Environmental on vehicles and engines used in the (e) Mechanism for granting of an
Protection Agency, 1310 L Street, NW., program will be recorded and made exemption. A request for a research and
6th floor, Washington, DC 20005 available to the Administrator upon development exemption will be deemed
(express mail/courier); and request; approved by the earlier of 60 days from
Director, Air Enforcement Division (iii) The manner in which information the date on which EPA receives the
(2242A), U.S. Environmental Protection on the diesel fuel used in the program request for exemption, (provided that
Agency, Ariel Rios Building, 1200
(including quantity, fuel properties, EPA has not notified the applicant of
Pennsylvania Avenue, NW., Washington,
DC 20460. name, address, telephone number and potential disapproval by that time), or
contact person of the supplier, and the the date on which the applicant receives
(b) Criteria for a research and date received from the supplier), will be a written approval letter from EPA.
development exemption. For a research recorded and made available to the (1) The volume of diesel fuel subject
and development exemption to be Administrator upon request; to the approval shall not exceed the
granted, the person requesting an (iv) The manner in which the party estimated amount under paragraph
exemption must— will ensure that the research and (c)(3)(iv) of this section, unless EPA
(1) Demonstrate a purpose that grants a greater amount in writing.
development fuel will be segregated
constitutes an appropriate basis for
from motor vehicle diesel fuel or NRLM (2) Any exemption granted under this
exemption;
diesel fuel, as applicable, and how fuel section will expire at the completion of
(2) Demonstrate that an exemption is
pumps will be labeled to ensure proper the test program or three years from the
necessary;
(3) Design a research and use of the research and development date of approval, whichever occurs first,
development program to be reasonable diesel fuel; and may only be extended upon re-
in scope; and (v) The name, address, telephone application consistent will all
(4) Exercise a degree of control number and title of the person(s) in the requirements of this section.
consistent with the purpose of the organization requesting an exemption (3) The passage of 60 days will not
program and EPA’s monitoring from whom further information on the signify the acceptance by EPA of the
requirements. application may be obtained; and validity of the information in the
(c) Information required to be (vi) The name, address, telephone request for an exemption. EPA may elect
submitted. To demonstrate each of the number and title of the person(s) in the at any time to review the information
elements in paragraphs (b)(1) through organization requesting an exemption contained in the request, and where
(4) of this section, the person requesting who is responsible for recording and appropriate may notify the responsible
an exemption must include the making available the information person of disapproval of the exemption.
following information in the written specified in this paragraph (c), and the (4) In granting an exemption the
request required under paragraph (a) of location where such information will be Administrator may include terms and
this section: maintained. conditions, including replacement of
(1) A concise statement of the purpose (d) Additional requirements. (1) The emission control devices or elements of
of the program demonstrating that the product transfer documents associated design, that the Administrator
program has an appropriate research with research and development motor determines are necessary for monitoring
and development purpose. vehicle diesel fuel must comply with the exemption and for assuring that the
(2) An explanation of why the stated requirements of § 80.590(b)(3). purposes of this subpart are met.
purpose of the program cannot be (2) The research and development (5) Any violation of a term or
achieved in a practicable manner diesel fuel must be designated by the condition of the exemption, or of any
without performing one or more of the refiner or supplier, as applicable, as requirement of this section, will cause
prohibited acts under this subpart. research and development diesel fuel. the exemption to be void ab initio.
(6) If any information required under for sale, dispense, supply, offer for vehicle, that does not comply with the
paragraph (c) of this section should supply, store or transport motor vehicle standards and dye requirements of
change after approval of the exemption, diesel fuel, NRLM diesel fuel, or heating § 80.520(a) and (b);
the responsible person must notify EPA oil that does not comply with the (2) Introduce, or permit the
in writing immediately. Failure to do so applicable standards, dye, marking or introduction of, fuel into any nonroad
may result in disapproval of the any other product requirements under diesel engine (including any locomotive
exemption or may make it void ab this subpart I and 40 CFR part 69. or marine diesel engine) that does not
initio, and may make the party liable for (2) Beginning June 1, 2007, produce, comply with the applicable standards,
a violation of this subpart. import, sell, offer for sale, dispense, dye and marking requirements of
(f) Effects of exemption. Motor vehicle supply, offer for supply, store or § 80.510(a), (d), and (e) and § 80.520(b)
diesel fuel or NRLM diesel fuel that is transport any diesel fuel for use in beginning on the following dates:
subject to a research and development motor vehicle or nonroad engines that (i) This prohibition begins December
exemption under this section is exempt contains greater than 0.10 milligrams 1, 2007 in the areas specified in
from other provisions of this subpart per liter of solvent yellow 124, except § 80.510(g)(1) and (g)(2), except as
provided that the fuel is used in a for 500 ppm sulfur diesel fuel produced specified in paragraph (e)(2)(ii) of this
manner that complies with the purpose or imported from June 1, 2010 through section.
of the program under paragraph (c) of September 30, 2012 for use only in (ii) This prohibition begins December
this section and the requirements of this locomotive or marine diesel engines that 1, 2010 in the area specified in
section. is marked under the provisions of § 80.510(g)(2) for NRLM diesel fuel that
(g) Notification of completion. The § 80.510(e). is produced in accordance with a
party shall notify EPA in writing within (3) Beginning June 1, 2007, produce, compliance plan approved under
30 days after completion of the research import, sell, offer for sale, dispense, § 80.554.
and development program. supply, offer for supply, store or (iii) This prohibition begins December
■ 66. A new § 80.608 is added to read as transport heating oil for use in any 1, 2010 in all other areas.
follows: nonroad diesel engine, including any (3) Introduce, or permit the
locomotive or marine diesel engine. introduction of, fuel into any nonroad
§ 80.608 What requirements apply to (b) Designation and volume balance diesel engine (other than locomotive
diesel fuel for use in the Territories? violation. Produce, import, sell, offer for and marine diesel engines) that does not
The sulfur standards of § 80.520(a)(1) sale, dispense, supply, offer for supply, comply with the applicable standards,
and (c) related to motor vehicle diesel store or transport motor vehicle diesel, dye and marking requirements of
fuel, and of § 80.510(a), (b), and (c) NRLM diesel fuel, heating oil or other § 80.510(b) and (e) beginning on the
related to NRLM diesel fuel, do not distillate that does not comply with the following dates:
apply to diesel fuel that is produced, applicable designation or volume (i) This prohibition begins December
imported, sold, offered for sale, balance requirements under §§ 80.598 1, 2010 in the areas specified in
supplied, offered for supply, stored, and 80.599. § 80.510(g)(1) and (g)(2), except as
dispensed, or transported for use in the (c) Additive violation. (1) Produce, specified paragraph (e)(3)(ii) of this
Territories of Guam, American Samoa or import, sell, offer for sale, dispense, section.
the Commonwealth of the Northern supply, offer for supply, store or (ii) This prohibition begins December
Mariana Islands, provided that such transport any motor vehicle diesel fuel 1, 2014 in the area specified in
diesel fuel is— additive or NRLM diesel fuel additive § 80.510(g)(2) for NRLM diesel fuel that
(a) Designated by the refiner or for use at a downstream location that is produced in accordance with a
importer as high sulfur diesel fuel only does not comply with the applicable compliance plan approved under
for use in Guam, American Samoa, or requirements of § 80.521. § 80.554.
the Commonwealth of the Northern (2) Blend or permit the blending into (iii) This prohibition begins beginning
Mariana Islands; motor vehicle diesel fuel or NRLM December 1, 2014 in all other areas.
(b) Used only in Guam, American diesel fuel at a downstream location, or (4) Introduce, or permit the
Samoa, or the Commonwealth of the use, or permit the use, in motor vehicle introduction of, fuel into any
Northern Mariana Islands; diesel fuel or NRLM diesel fuel, of any locomotive and marine diesel engine
(c) Accompanied by documentation additive that does not comply with the which does not comply with the
that complies with the product transfer applicable requirements of § 80.521. applicable standards, dye and marking
document requirements of (d) Used motor oil violation. requirements of § 80.510(c) and
§ 80.590(b)(1); and Introduce into the fuel system of a § 80.510(f) in the following areas
(d) Segregated from non-exempt model year 2007 or later diesel motor beginning on the following dates:
MVNRLM diesel fuel at all points in the vehicle or model year 2011 or later (i) This prohibition begins December
distribution system from the point the nonroad diesel engine (except for 1, 2012 in the areas specified in
diesel fuel is designated as exempt fuel locomotive or marine engines) or other § 80.510(g)(1) and (g)(2), except as
only for use in Guam, American Samoa, nonroad diesel engine certified for the specified in paragraph (e)(4)(ii) of this
or the Commonwealth of the Northern use of 15 ppm sulfur content fuel, or section.
Mariana Islands, while the exempt fuel permit the introduction into the fuel (ii) This prohibition does not apply in
is in the United States but outside these system of such vehicle or nonroad the area specified in § 80.510(g)(2) for
Territories. engine of used motor oil, or used motor NRLM diesel fuel that is produced in
■ 67. Section 80.610 is revised to read as oil blended with diesel fuel, that does accordance with a compliance plan
follows: not comply with the requirements of approved under § 80.554.
§ 80.522. (iii) This prohibition does not apply
§ 80.610 What acts are prohibited under (e) Improper fuel usage violation. (1) in any other areas.
the diesel fuel sulfur program? Introduce, or permit the introduction of, (5) Introduce, or permit the
No person shall— fuel into model year 2007 or later diesel introduction of, fuel into any model
(a) Standard, dye, marker or product motor vehicles, and beginning year 2011 or later nonroad diesel engine
violation. (1) Produce, import, sell, offer December 1, 2010 into any diesel motor certified for use on 15 ppm sulfur
content fuel, diesel fuel which does not subpart, may be based on information facility where a violation of § 80.610(a)
comply with the applicable standards, obtained from any source or location. or (b) occurred, is deemed in violation
dye and marking requirements of Such information may include, but is of § 80.610(a) or (b), as applicable.
§ 80.510(b) through (f). not limited to, business records and (4) Carrier causation. In order for a
(f) Cause another party to violate. commercial documents. distillate fuel or diesel fuel additive
Cause another person to commit an act ■ 69. Section 80.612 is amended by carrier to be liable under paragraph
in violation of paragraphs (a) through (e) revising paragraph (a) to read as follows: (a)(1)(ii), (a)(1)(iii), or (a)(1)(iv) of this
of this section. section, as applicable, EPA must
(g) Cause violating fuel or additive to § 80.612 Who is liable for violations of this
demonstrate, by reasonably specific
subpart?
be in the distribution system. Cause showing by direct or circumstantial
motor vehicle diesel fuel, or NRLM (a) Persons liable for violations of evidence, that the carrier caused the
diesel fuel, to be in the diesel fuel prohibited acts. (1) Standard, dye, violation.
distribution system which does not marker, additives, used motor oil, (5) Parent corporation. Any parent
comply with the applicable standard, heating oil, fuel introduction, and other corporation is liable for any violations
dye or marker requirements or the product requirement violations. (i) Any of this subpart that are committed by
product segregation requirements of this refiner, importer, distributor, reseller, any subsidiary.
Subpart I, or cause any diesel fuel carrier, retailer, wholesale purchaser- (6) Joint venture. Each partner to a
additive to be in the diesel fuel additive consumer who owned, leased, operated, joint venture is jointly and severally
distribution system which does not controlled or supervised a facility where liable for any violation of this subpart
comply with the applicable sulfur a violation of any provision of that occurs at the joint venture facility
standards under § 80.521. § 80.610(a) through (e) occurred, or any or is committed by the joint venture
■ 68. Section 80.611 is revised to read as other person who violates any provision operation.
follows: of § 80.610(a) through (e), is deemed * * * * *Ä
liable for the applicable violation, ■ 70. Section 80.613 is amended by Ä
§ 80.611 What evidence may be used to except that distributors who receive
determine compliance with the prohibitions
revising the section heading and Ä
diesel fuel or distillate from the point paragraphs (a) and (d) to read as follows:Ä
and requirements of this subpart and where it is taxed, dyed or marked, and
liability for violations of this subpart?
retailers and wholesale purchaser- § 80.613 What defenses apply to persons
(a) Compliance with sulfur, cetane, consumers are not deemed liable for any deemed liable for a violation of a prohibited
and aromatics standards, dye and violation of § 80.610(b). act under this subpart?
marker requirements. Compliance with (ii) Any person who causes another (a) Presumptive liability defenses. (1)
the standards, dye, and marker person to violate § 80.610(a) through (e) Any person deemed liable for a
requirements in §§ 80.510, 80.511, is liable for a violation of § 80.610(f). violation of a prohibition under
80.520, and 80.521 shall be determined (iii) Any refiner, importer, distributor, § 80.612(a)(1)(i), (a)(1)(iii), (a)(2), or
based on the level of the applicable reseller, carrier, retailer, or wholesale (a)(3), will not be deemed in violation
component or parameter, using the purchaser-consumer who produced, if the person demonstrates the
sampling methodologies specified in imported, sold, offered for sale, following:
§ 80.330(b), as applicable, and an dispensed, supplied, offered to supply, (i) The violation was not caused by
approved testing methodology under the stored, transported, or caused the the person or the person’s employee or
provisions of §§ 80.580 through 80.586 transportation or storage of, diesel fuel agent;
for sulfur; § 80.2(w) for cetane index; or distillate that violates § 80.610(a), is (ii) Product transfer documents
§ 80.2(z) for aromatic content; and deemed in violation of § 80.610(f). account for fuel or additive found to be
§ 80.582 for fuel marker. Any evidence (iv) Any person who produced, in violation and indicate that the
or information, including the exclusive imported, sold, offered for sale, violating product was in compliance
use of such evidence or information, dispensed, supplied, offered to supply, with the applicable requirements when
may be used to establish the level of the stored, transported, or caused the it was under the person’s control;
applicable component or parameter in transportation or storage of a diesel fuel (iii) The person conducted a quality
the diesel fuel or additive, or motor oil additive which is used in motor vehicle assurance sampling and testing
to be used in diesel fuel, if the evidence diesel fuel or NRLM diesel fuel that is program, as described in paragraph (d)
or information is relevant to whether found to violate § 80.610(a), is deemed of this section, except for those persons
that level would have been in in violation of § 80.610(f). subject to the provisions of paragraph
compliance with the standard if the (2) Cause violating diesel fuel or (a)(1)(iv), (a)(1)(v), or (a)(1)(vi) of this
regulatory sampling and testing additive to be in the distribution system. section or § 80.614. A carrier may rely
methodology had been correctly Any refiner, importer, distributor, on the quality assurance program
performed. Such evidence may be reseller, carrier, retailer, or wholesale carried out by another party, including
obtained from any source or location purchaser-consumer or any other person the party who owns the diesel fuel in
and may include, but is not limited to, who owned, leased, operated, controlled question, provided that the quality
test results using methods other than the or supervised a facility from which assurance program is carried out
compliance methods in this paragraph distillate fuel or additive was released properly. Retailers, wholesale
(a), business records, and commercial into the distribution system which does purchaser-consumers, and ultimate
documents. not comply with the applicable consumers of diesel fuel are not
(b) Compliance with other standards, marking or dye requirements required to conduct quality assurance
requirements. Determination of of this Subpart I is deemed in violation programs;
compliance with the requirements and of § 80.610(g). (iv) For refiners and importers of
prohibitions of this subpart other than (3) Branded refiner/importer liability. diesel fuel subject to the 15 ppm sulfur
the standards described in paragraph (a) Any refiner or importer whose standard under § 80.510(b) or (c), or
of this section and in §§ 80.510, 80.511, corporate, trade, or brand name, or § 80.520(a)(1), or the 500 ppm sulfur
80.520, and 80.521, and determination whose marketing subsidiary’s corporate, standard under § 80.510(a) or 80.520(c),
of liability for any violation of this trade, or brand name appeared at a test results that—
(A) Were conducted according to an and indicate that the additive was in (1) A periodic sampling and testing
appropriate test methodology approved compliance with the applicable program to ensure the diesel fuel or
or designated under §§ 80.580 through requirements while it was under the additive the person sold, dispensed,
80.586, 80.2(w), or 80.2(z), as party’s control; and supplied, stored, or transported, meets
appropriate; and (ii) For the additive’s manufacturer or the applicable standards and
(B) Establish that, when it left the importer, test results which accurately requirements, including the
party’s control, the fuel did not violate establish that, when it left the party’s requirements relating to the presence of
the sulfur, cetane or aromatics standard, control, the additive in the diesel fuel marker solvent yellow 124.
or the dye or marking provisions of determined to be in violation did not (2) For those parties who, at a
§§ 80.510 or 80.511, as applicable; have a sulfur content greater than or downstream location, blend diesel fuel
(v) For any truck loading terminal or equal to 15 ppm. additives subject to the requirements of
any other person who delivers heating (A) Analysis of the additive sulfur § 80.521(b) into fuel trucks at a truck
oil for delivery to the ultimate consumer content pursuant to this paragraph (a)(2) loading rack, the periodic sampling and
and is subject to the requirement to may be conducted at the time the batch testing program required under this
mark heating oil or LM diesel fuel under was manufactured or imported, or on a paragraph (d) must ensure, by taking
§ 80.510(d) through (f), data which sample of that batch which the into account the greater risk of
demonstrates that when it left the truck manufacturer or importer retains for noncompliance created through use of a
loading terminal or other facility, the such purpose for a minimum of two high sulfur additive, that the diesel fuel
concentration of marker solvent yellow years from the date the batch was into which the additive was blended
124 was equal to or greater than six manufactured or imported. meets the applicable standards
milligrams per liter. In lieu of testing for (B) After two years from the date the subsequent to the blending.
marker solvent yellow 124 additive batch was manufactured or (3) On each occasion when diesel fuel
concentration, evidence may be imported, the additive manufacturer or or additive is found not in compliance
presented of an oversight program, importer is no longer required to retain with the applicable standard:
including records of marker inventory, samples for the purpose of complying (i) The person immediately ceases
purchase and additization, and records with the testing requirements of this selling, offering for sale, dispensing,
of periodic inspection and calibration of paragraph (a)(2). supplying, offering for supply, storing or
additization equipment that ensures that (C) The analysis of the sulfur content transporting the non-complying
marker is added to heating oil or LM of the additive must be conducted product.
diesel fuel, as applicable, under pursuant to the requirements of (ii) The person promptly remedies the
§ 80.510(d) through (f) in the required § 80.580. violation and the factors that caused the
concentration; (3) Any person who is deemed liable violation (for example, by removing the
(vi) Except as provided in § 80.614, for a violation under § 80.612(a)(1)(iv) non-complying product from the
for any person who, at a downstream with regard to a diesel fuel additive distribution system until the applicable
location, blends a diesel fuel additive subject to the requirements of standard is achieved and taking steps to
subject to the requirements of § 80.521(b), will not be deemed in prevent future violations of a similar
§ 80.521(b) into motor vehicle diesel violation if the person demonstrates nature from occurring).
fuel or NRLM diesel fuel subject to the that— (4) For any carrier who transports
15 ppm sulfur standard under (i) The violation was not caused by diesel fuel or additive in a tank truck,
§ 80.520(a) or § 80.510(b) or (c), except the party or the party’s employee or the quality assurance program required
a person who blends additives into fuel agent; under this paragraph (d) need not
tanker trucks at a truck loading rack (ii) Product transfer document(s) include its own periodic sampling and
subject to the provisions of paragraph which comply with the additive testing of the diesel fuel or additive in
(d)(2) of this section, test results which information requirements under the tank truck, but in lieu of such tank
are conducted subsequent to the § 80.591(b), account for the additive in truck sampling and testing, the carrier
blending of the additive into the fuel, the fuel found to be in violation, and shall demonstrate evidence of an
and which comply with the indicate that the additive was in oversight program for monitoring
requirements of paragraphs (a)(1)(iv)(A) compliance with the applicable compliance with the requirements of
and (B) of this section; and requirements while it was under the this subpart relating to the transport or
(vii) Any person deemed liable for a party’s control; and storage of such product by tank truck,
designation or volume balance (iii) For the additive’s manufacturer or such as appropriate guidance to drivers
provisions violation under § 80.610(b) importer, test results which accurately regarding compliance with the
and 80.612(a) will not be deemed in establish that, when it left the party’s applicable sulfur standard, product
violation if the person demonstrates, control, the additive in the diesel fuel segregation and product transfer
through product transfer documents, determined to be in violation was in document requirements, and the
records, reports and other evidence that conformity with the information on the periodic review of records received in
the diesel fuel or distillate was properly additive product transfer document the ordinary course of business
designated and volume balance pursuant to the requirements of concerning diesel fuel or additive
requirements were met. § 80.591(b). The testing procedures quality and delivery.
(2) Any person deemed liable for a applicable under paragraph (a)(2) of this ■ 71. Section 80.614 is revised to read as
violation under § 80.612(a)(1)(iv), in section, also apply under this paragraph follows:
regard to a diesel fuel additive subject (a)(3).
§ 80.614 What are the alternative defense
to the requirements of § 80.521(a), will * * * * * requirements in lieu of § 80.613(a)(1)(vi) for
not be deemed in violation if the person (d) Quality assurance and testing static dissipater additives exceeding the 15
demonstrates that— program. To demonstrate an acceptable ppm sulfur standard but that contribute less
(i) Product transfer document(s) quality assurance program under than 0.05 ppm sulfur when added to
account for the additive in the fuel paragraph (a)(1)(iii) of this section, a MVNRLM diesel fuel?
found to be in violation, which comply person must present evidence of the Any person who blends a MVNRLM
with the requirements under § 80.591(a), following: diesel fuel additive package into
MVNRLM diesel fuel subject to the 15 or some other measurement system that meter being measured, or other
ppm sulfur standards of § 80.510(b) or is able to accurately distinguish its use. comparable metered measurements. The
(c) or § 80.520(a) which contains a static (e) Recorded volumes of MVNRLM supporting data may be supplied on the
dissipater additive that has a sulfur diesel fuel and static dissipater additive VAR formula record or in the form of
content greater than 15 ppm but whose package must be expressed to the computer printouts or other comparable
contribution to the sulfur content of the nearest gallon (or smaller units), except VAR supporting documentation.
MVNRLM diesel fuel is less than 0.05 that static dissipater additive package (B) For a facility which uses a gauge
ppm at its maximum recommended volumes of five gallons or less must be to measure the inventory of the static
concentration, and which contains no expressed to the nearest tenth of a dissipater additive package storage tank,
other additives with a sulfur content gallon (or smaller units). However, if the the total volume of static dissipater
greater than 15 ppm must establish all blender’s equipment cannot accurately additive package shall be calculated
the following in order to use this section measure to the nearest tenth of a gallon, from the following equation:
as an alternative to the defense element then such volumes must be rounded Static dissipater additive package Volume = Ä
under § 80.613(a)(1)(vi): upward to the next higher gallon for (A)¥(B)+(C) ¥ (D)Ä
(a)(1) The blender of the static purposes of determining compliance Where: Ä
dissipater additive package has a sulfur with this section. A = Initial static dissipater additive package Ä
content test result for the MVNRLM (f) Each VAR formula record must inventory of the tank
diesel fuel prior to blending of the also contain the following information: B = Final static dissipater additive package
additive that indicates that the additive (1) Automated blending facilities. In inventory of the tank
package, when added, will not cause the the case of an automated static C = Sum of any additions to static dissipater
MVNRLM diesel fuel sulfur content to dissipater additive package blending additive package inventory
exceed 15 ppm sulfur. facility, for each VAR period, for each D = Sum of any withdrawals from static
(2) In cases where the storage tank static dissipater additive package dissipater additive package inventory for
storage system, and each static purposes other than the additization of
that contains MVNRLM diesel fuel prior
MVNRLM diesel fuel.
to additization contains multiple fuel dissipater additive package in that
batches, the blender of the static storage system, the following must be (C) The value of each variable in the
dissipater additive package must have recorded: equation in paragraph (f)(1)(ii)(B) of this
sulfur test results on each batch of (i)(A) The manufacturer and section must be separately recorded on
MVNRLM diesel fuel that was added to commercial identifying name of the the VAR formula record. In addition, a
the storage tank during the current and static dissipater additive package being list of each static dissipater additive
previous VAR periods, which indicates reconciled, the maximum recommended package addition included in variable C
that the additive package, when added treatment level, the potential and a list of each static dissipater
to the component MVNRLM diesel fuel contribution to the sulfur content of the additive package withdrawal included
batch in the storage tank with the finished fuel that might result when the in variable D must be provided, either
highest sulfur level would not cause additive package is used at its maximum on the formula record or as VAR
that component batch to exceed 15 ppm recommended treatment level, the supporting documentation.
sulfur. intended treatment level, and the (iii) The total volume of MVNRLM
(b) The volumetric additive contribution to the sulfur content of the diesel fuel to which static dissipater
reconciliation (VAR) standard is finished fuel that would result when the additive package has been added,
attained as determined under the additive package is used at its intended together with supporting data which
provisions of this section. The VAR treatment level. The intended treatment includes one of the following: the
reconciliation standard is attained when level is the treatment level that the beginning and ending meter
the actual concentration of a static additive injection equipment is set to. measurements for each meter being
dissipater additive package used per the (B) The maximum recommended measured, the metered batch volume
VAR formula record under paragraph (f) treatment level and the intended measurements for each meter being
of this section is less than the treatment level must be expressed in measured, or other comparable metered
concentration that would have caused terms of gallons of static dissipater measurements. The supporting data may
any batch of MVNRLM diesel fuel to additive package per thousand gallons be supplied on the VAR formula record
exceed a sulfur content of 15 ppm given of MVNRLM diesel fuel, and expressed or in the form of computer printouts or
the maximum sulfur test result on any to four significant figures. If the static other comparable VAR supporting
MVNRLM diesel fuel batch described in dissipater additive package storage documentation.
paragraph (a) of this section that is system which is the subject of the VAR (iv) The actual static dissipater
additized with the static dissipater formula record is a proprietary system additive package concentration,
additive package during the VAR under the control of a customer, this fact calculated as the total volume of static
period. must be indicated on the record. dissipater additive package added
(c) The product transfer document (ii) The total volume of static (pursuant to paragraph (f)(1)(ii) of this
complies with the applicable sulfur dissipater additive package blended into section), divided by the total volume of
information requirements of § 80.591. MVNRLM diesel fuel, in accordance MVNRLM diesel fuel (pursuant to
(d) If more than one static dissipater with one of the following methods, as paragraph (f)(1)(iii) of this section). The
additive package is used during a VAR applicable. concentration must be calculated and
period, then a separate VAR formula (A) For a facility which uses in-line recorded to 4 significant figures.
record must be created for MVNRLM meters to measure static dissipater (v) A list of each static dissipater
diesel fuel additized for each of the additive package usage, the total volume additive package concentration rate set
static dissipater additive packages used. of static dissipater additive package for the static dissipater additive package
In such cases, the amount of the each measured, together with supporting data that is the subject of the VAR record,
static dissipater additive package used which includes one of the following: the together with the date and description
must be accurately and separately beginning and ending meter readings for of each adjustment to any initially set
measured, either through the use of a each meter being measured, the metered concentration. The concentration
separate storage tank, a separate meter, batch volume measurements for each adjustment information may be
supplied on the VAR formula record or (2) Non-automated facilities. In the paragraphs (f)(1) and (f)(2) of this
in the form of computer printouts or case of a facility in which hand section shall contain the following:
other comparable VAR supporting blending or any other non-automated (i) The signature of the creator of the
documentation. No concentration method is used to blend static dissipater VAR record;
setting is permitted above the maximum additive packages, for each static (ii) The date of the creation of the
recommended concentration supplied dissipater additive package and for each VAR record; and
by the additive manufacturer, except as batch of MVNRLM diesel fuel to which (iii) A certification of correctness by
described in paragraph (f)(1)(vii) of this the static dissipater additive package is the creator of the VAR record.
section. being added, the following shall be (4) Electronically-generated VAR
(vi) The dates of the VAR period, recorded: formula and supporting records. (i)
which shall be no longer than thirty-one (i) The manufacturer and commercial Electronically-generated records are
days. If the VAR period is identifying name of the static dissipater acceptable for VAR formula records and
contemporaneous with a calendar additive package being reconciled, the supporting documentation (including
month, then specifying the month will maximum recommended treatment PTDs), provided that they are complete,
fulfill this requirement; if not, then the level, the potential contribution to the accessible, and easily readable. VAR
beginning and ending dates and times of sulfur content of the finished fuel that formula records must also be stored
the VAR period must be listed. The might result when the fuel is used at its with access and audit security, which
times may be supplied on the VAR maximum recommended treatment must restrict to a limited number of
formula record or in supporting level, the intended treatment level, and specified people those who have the
documentation. Any adjustment to any the contribution to the sulfur content of ability to alter or delete the records. In
static dissipater additive package the finished fuel that would result when addition, parties maintaining records
concentration rate initially set in the the additive package is used at its electronically must make available to
VAR period shall terminate that VAR intended treatment level. EPA the hardware and software
period and initiate a new VAR period, (A) The maximum recommended necessary to review the records.
except as provided in paragraph treatment level and the intended (ii) Electronically-generated VAR
(f)(1)(vii) of this section. treatment level must be expressed in formula records may use an electronic
(vii) The concentration setting for a terms of gallons of static dissipater user identification code to satisfy the
static dissipater additive package additive package per thousand gallons signature requirements of paragraph
injector may be changed from the of MVNRLM diesel fuel, and expressed (f)(3)(i) of this section, provided that:
concentration initially set in the VAR to four significant figures. (A) The use of the identification is
period without terminating that VAR (B) If the static dissipater additive limited to the record creator; and
period, provided that: package storage system which is the
(A) The purpose of the change is to (B) A paper record is maintained,
subject of the VAR formula record is a which is signed and dated by the VAR
correct a batch under-additization prior proprietary system under the control of
to the end of the VAR period and prior formula record creator, acknowledging
a customer, this fact must be indicated that the use of that particular user ID on
to the transfer of the batch to another on the record.
party, or to correct an equipment a VAR formula record is equivalent to
(ii) The date of the additization that
malfunction where there has been no his/her signature on the document.
is the subject of the VAR formula
over-additization of the additive; (5) Calibration requirements for
record.
(B) The concentration is immediately (iii) The volume of added static automated blending facilities.
returned after the correction to a dissipater additive package. Automated static dissipater additive
concentration that fulfills the (iv) The volume of the MVNRLM package blenders must calibrate their
requirements of this paragraph (f); diesel fuel to which the static dissipater static dissipater additive package
(C) The blender creates and maintains additive package has been added. equipment at least once in each
documentation establishing the date and (v) The brand (if known) of MVNRLM calendar half year, with the acceptable
adjustments of the correction; and diesel fuel. calibrations being no less than one
(D) If the correction is initiated only (vi) The actual static dissipater hundred twenty days apart, except that
to rectify an equipment malfunction, additive package concentration, calibrations may be closer in time so
and the amount of static dissipater calculated as the volume of added static long as at least two calibrations meet the
additive package used in this procedure dissipater additive package (pursuant to requirements to be in separate halves of
is not added to MVNRLM diesel fuel paragraph (f)(1)(ii)(B) of this section), the calendar year and no less than 120
within the compliance period, then this divided by the volume of MVNRLM days apart. Equipment recalibration is
amount is subtracted from the static diesel fuel (pursuant to paragraph also required each time the static
dissipater additive package volume (f)(1)(iii) of this section). The dissipater additive package is changed,
listed on the VAR formula record. In concentration must be calculated and unless written documentation indicates
such a case, the addition of this amount recorded to four significant figures. that the new static dissipater additive
of static dissipater additive must be (vii) The measured sulfur level for package has the same viscosity as the
reflected in the following VAR period. each batch of MVNRLM diesel fuel to previous static dissipater additive
(viii) The measured sulfur level for which a static dissipater additive package. Static dissipater package
each batch of MVNRLM diesel fuel to package is added during each VAR change calibrations may be used to
which a static dissipater additive period. In cases where the storage tanks satisfy the semiannual requirement
package is added during each VAR that contains MVNRLM diesel fuel prior provided that the calibrations occur in
period. In cases where the storage tank to additization contains multiple fuel the appropriate half calendar year and
that contains MVNRLM diesel fuel prior batches, a measured sulfur level on each are no less than one hundred twenty
to additization contains multiple fuel batch added to the storage tank during days apart.
batches, a measured sulfur level on each the current and previous VAR periods (6) Additional VAR documentation.
batch added to the storage tank during must be recorded. The following VAR supporting
the current and previous VAR periods (3) VAR formula records. Every VAR documentation must also be created and
must be recorded. formula record created pursuant to maintained:
(i) For all automated static dissipater business day after the EPA request to (c) Any person liable under
additive package blending facilities, supply VAR supporting documentation, § 80.612(b) for failure to meet, or
documentation reflecting performance or longer if approved by the Agency. causing a failure to meet, a provision of
of the calibrations required by (iv) In this paragraph (f)(7), the term this subpart is liable for a separate day
paragraph (f)(5) of this section, and any ‘‘immediately available’’ means that the of violation for each and every day such
associated adjustments of the automated records must be provided, electronically provision remains unfulfilled.
static dissipater additive package or otherwise, within approximately one ■ 73. Section 80.620 is amended by
injection equipment; hour of EPA’s request, or within a revising the section heading and
(ii) For all static dissipater additive longer time frame as approved by EPA. paragraphs (a), (b), (c), (d)(2), (d)(3)(i)(D),
package blending facilities, product ■ 72. A new § 80.615 is added to read as (e)(1), (f)(2)(ii) introductory text,
transfer documents for all static follows: (f)(3)(ii), (g), (h) introductory text, (h)(2),
dissipater additive packages, and static (i)(1)(v), (i)(1)(vi), (i)(5), (j), (k)(1), (k)(3),
dissipater-additized MVNRLM diesel § 80.615 What penalties apply under this (n), (o), (p), (q), (r), and (s) to read as
fuel transferred into or out of the subpart? follows:
facility; (a) Any person liable for a violation
(iii) For all automated static dissipater § 80.620 What are the additional
under § 80.612 is subject to civil requirements for diesel fuel or distillates
additive package blending facilities, penalties as specified in section 205 of produced by foreign refineries subject to a
documentation establishing the brands the Clean Air Act (42 U.S.C. 7524) for temporary refiner compliance option,
(if known) of the MVNRLM diesel fuel every day of each such violation and the hardship provisions, or motor vehicle or
which is the subject of the VAR formula amount of economic benefit or savings NRLM diesel fuel credit provisions?
record; and resulting from each violation. (a) Definitions. (1) A foreign refinery
(iv) For all hand blending static (b)(1) Any person liable under is a refinery that is located outside the
dissipater additive package blenders, § 80.612(a)(1) for a violation of an United States, the Commonwealth of
the documentation, if in the party’s applicable standard or requirement Puerto Rico, the Virgin Islands, Guam,
possession, supporting the volumes of under this Subpart I or for causing American Samoa, and the
MVNRLM diesel fuel and static another party to violate such standard or Commonwealth of the Northern Mariana
dissipater additive package reported on Islands (collectively referred to in this
requirement, is subject to a separate day
the VAR formula record. section as ‘‘the United States’’).
of violation for each and every day the
(7) Document retention and (2) A foreign refiner is a person who
non-complying diesel fuel remains any
availability. All static dissipater meets the definition of refiner under
place in the distribution system.
additive package blenders shall retain § 80.2(i) for a foreign refinery.
the documents required under this (2) Any person liable under
§ 80.612(a)(2) for causing motor vehicle (3) A diesel fuel program foreign
section for a period of five years from refiner (‘‘DFR’’) is a foreign refiner that
the date the VAR formula records and diesel fuel, NRLM diesel fuel, heating
oil, or other distillate fuel to be in the has been approved by EPA for
supporting documentation are created, participation in any motor vehicle
and shall deliver them upon request to distribution system which does not
comply with an applicable standard or diesel fuel or NRLM diesel fuel
the EPA Administrator or the provision of § 80.530 through 80.533, or
Administrator’s authorized requirement of this Subpart I is subject
to a separate day of violation for each §§ 80.535, 80.536, 80.540, 80.552,
representative. 80.553, 80.554, 80.560 or 80.561
(i) Except as provided in paragraph and every day that the non-complying
diesel fuel remains any place in the (collectively referred to as ‘‘diesel
(f)(7)(iii) of this section, automated foreign refiner program’’).
static dissipater additive package diesel fuel distribution system.
(4) ‘‘DFR-Diesel’’ means diesel fuel or
blender facilities and hand-blender (3) Any person liable under distillate fuel as applicable under
facilities which are terminals, which § 80.612(a)(1) for blending into diesel subpart I of this part produced at a DFR
physically blend static dissipater fuel an additive violating the applicable refinery that is imported into the United
additive packages into MVNRLM diesel sulfur standard pursuant to the States.
fuel, must make immediately available requirements of § 80.521(a) or (b), as (5) ‘‘Non-DFR-Diesel’’ means diesel
to EPA, upon request, the preceding applicable, or of causing another party fuel or distillate fuel that is produced at
twelve months of VAR formula records to so blend such an additive, is subject a foreign refinery that has not been
plus the preceding two months of VAR to a separate day of violation for each approved as a DFR foreign refiner,
supporting documentation. and every day the motor vehicle diesel diesel fuel produced at a DFR foreign
(ii) Except as provided in paragraph fuel or NRLM diesel fuel into which the refinery that is not imported into the
(f)(7)(iii) of this section, other hand- noncomplying additive was blended, United States, and diesel fuel produced
blending static dissipater additive remains any place in the fuel at a DFR foreign refinery during a period
package facilities which physically distribution system. when the foreign refiner has opted to
blend static dissipater additive package (4) For purposes of this paragraph (b) not participate in the DFR-Diesel foreign
into MVNRLM diesel fuel must make of this section, the length of time the refiner program under paragraph (c)(3)
immediately available to EPA, upon motor vehicle diesel fuel, NRLM diesel of this section.
request, the preceding two months of fuel, heating oil or other distillate fuel (6) ‘‘Certified DFR-Diesel’’ means
VAR formula records and VAR in question remained in the diesel fuel DFR-Diesel the foreign refiner intends to
supporting documentation. distribution system is deemed to be 25 include in the foreign refinery’s
(iii) Facilities which have centrally days, unless a person subject to liability compliance calculations under any
maintained records at other locations, or or EPA demonstrates by reasonably provisions of § 80.530 through 80.533,
have customers who maintain their own specific showings, by direct or or §§ 80.535, 80.536, 80.540, 80.552,
records at other locations for their circumstantial evidence, that the non- 80.553, 80.554, 80.560 or 80.561 and
proprietary static dissipater additive complying motor vehicle, NR or NRLM does include in these compliance
package injection systems, and which diesel fuel, heating oil or distillate fuel calculations when reported to EPA.
can document this fact to the Agency, remained in the distribution system for (7) ‘‘Non-Certified DFR-Diesel’’ means
may have until the start of the next fewer than or more than 25 days. DFR-Diesel fuel that a DFR foreign
refiner imports to the United States that § 80.530, credits obtained from any (ii) The name and EPA refinery
is not Certified DFR-Diesel. other refinery or from any importer registration number (under § 80.597) of
(b) Baseline. For any foreign refiner to must have been generated in the same the refinery where the DFR-Diesel was
obtain approval under the diesel foreign Credit Trading Area as the Credit produced.
refiner program of this subpart for any Trading Area of import of the fuel for (3) * * *
refinery, it must apply for approval which credits are needed to achieve (i) * * *
under the applicable provisions of this compliance. (D) In the case of Certified DFR-
subpart. To obtain approval the refiner (iii) For purposes of generating credits Diesel:
is required, as applicable, to under § 80.531, credits shall be (1) The sulfur content as determined
demonstrate a volume baseline under generated separately by Credit Trading under paragraph (f) of this section, and
subpart I of this part. Area of import and shall be designated the applicable designations stated in
(1) The refiner shall follow the by Credit Trading Area of importation paragraph (d)(2)(i) of this section; and
procedures, applicable to volume and by port of importation. (2) A declaration that the DFR-Diesel
baselines and using diesel fuel, or if (2) In the case of Non-Certified DFR- is being included in the applicable
applicable, heating oil, instead of Diesel, the foreign refiner shall meet all compliance calculations required by
gasoline, in §§ 80.91 through 80.93 to the following requirements: EPA under this subpart.
establish the volume of motor vehicle (i) The designation requirements in * * * * *
diesel fuel that was produced at the this section. (e) * * *
refinery and imported into the United (ii) The reporting requirements in this (1)(i) The foreign refiner excludes:
States during the applicable years for section and in §§ 80.593, 80.594, 80.601, (A) The volume of diesel from the
purposes of establishing a baseline and 80.604. refinery’s compliance report under
under Subpart I for applicable fuels (iii) The product transfer document § 80.593, § 80.601, or § 80.604; and
produced for use in the United States. requirements in this section and in (B) In the case of Certified DFR-Diesel,
(2) In making determinations for §§ 80.590 and 80.591. the volume of the diesel fuel from the
foreign refinery baselines EPA will (iv) The prohibitions in this section compliance report under § 80.593,
consider all information supplied by a and in § 80.610. § 80.601, or § 80.604.
foreign refiner, and in addition may rely (3)(i) Any foreign refiner that has been
(ii) The exclusions under paragraph
on any and all appropriate assumptions approved to produce diesel fuel subject
(e)(1)(i) of this section shall be on the
necessary to make such determinations. to the diesel foreign refiner program for
basis of the designations under § 80.598
(3) Where a foreign refiner submits a a foreign refinery under this subpart
and this section, and volumes
petition that is incomplete or may elect to classify no diesel fuel
determined under paragraph (f) of this
inadequate to establish an accurate imported into the United States as DFR-
section.
baseline, and the refiner fails to correct Diesel provided the foreign refiner
notifies EPA of the election no later than * * * * *
this deficiency after a request for more (f) * * *
information, EPA will not assign an 60 calendar days prior to the beginning
of the compliance period. (2) * * *
individual refinery baseline. (ii) Determine the sulfur content value
(c) General requirements for DFR (ii) An election under paragraph
(c)(3)(i) of this section shall be for a 12 for each compartment, and if applicable,
foreign refiners. A foreign refiner of a the marker content under § 80.510(d)
refinery that is approved under the month compliance period and apply to
all diesel fuel that is produced by the through (f) using an approved
diesel foreign refiner program of this methodology as specified in §§ 80.580
subpart must designate each batch of foreign refinery that is imported into the
United States, and shall remain in effect through 80.586 by one of the following:
diesel fuel produced at the foreign
refinery that is exported to the United for each succeeding year unless and * * * * *
States as either Certified DFR-Diesel or until the foreign refiner notifies EPA of (3) * * *
as Non-Certified DFR-Diesel, except as the termination of the election. The (ii) To the Administrator containing
provided in paragraph (c)(3) of this change in election shall take effect at the the information required under
section. It must further designate all beginning of the next annual paragraphs (f)(1) and (f)(2) of this
Certified DFR-Diesel as provided in compliance period. section, within thirty days following the
§ 80.598, and designate whether the * * * * * date of the independent third party’s
diesel fuel is dyed or undyed, and for (d) * * * inspection. This report shall include a
heating oil and/or locomotive or marine (2) On each occasion when any description of the method used to
diesel fuel whether it is marked or person transfers custody or title to any determine the identity of the refinery at
unmarked under § 80.510(d) through (f). DFR-Diesel prior to its being imported which the diesel fuel or distillate was
It must further designate any credits into the United States, it must include produced, assurance that the diesel fuel
earned as either nonroad diesel credits the following information as part of the or distillate remained segregated as
or motor vehicle diesel credits. product transfer document information specified in paragraph (n)(1) of this
(1) In the case of Certified DFR-Diesel, in this section: section, and a description of the diesel
the foreign refiner must meet all (i) Designation of the diesel fuel or fuel’s movement and storage between
requirements that apply to refiners distillate as Certified DFR-Diesel or as production at the source refinery and
under this subpart, except that: Non-Certified DFR-Diesel, and if it is vessel loading.
(i) For purposes of complying with Certified DFR-Diesel, further designate * * * * *
the compliance option requirements of the fuel pursuant to § 80.598, and (g) Comparison of load port and port
§ 80.530, motor vehicle diesel fuel whether the diesel fuel or distillate is of entry testing. (1)(i) Any foreign refiner
produced by a foreign refinery must dyed or undyed, and for heating oil and any United States importer of
comply separately for each Credit whether it is marked or unmarked under Certified DFR-Diesel shall compare the
Trading Area of import, as defined in § 80.510(d) through (f), and all other results from the load port testing under
§ 80.531(a)(5). applicable product transfer document paragraph (f) of this section, with the
(ii) For purposes of complying with information required under § 80.590; port of entry testing as reported under
the compliance option requirements of and paragraph (o) of this section, for the
volume of diesel fuel and the sulfur content diesel fuel or high sulfur fuel in any diesel foreign refiner program, or
content value; except as specified in having a sulfur content greater than 500 to establish an individual refinery motor
paragraph (g)(1)(ii) of this section. ppm (and if so, whether the fuel is vehicle diesel fuel volume baseline or
(ii) Where a vessel transporting heating oil, small refiner diesel fuel, other baseline under subpart I of this
Certified DFR-Diesel off loads this diesel diesel fuel produced through the use of part (if applicable) constitute actions or
fuel at more than one United States port credits, or other applicable designation activities that satisfy the provisions of
of entry, and the conditions of under § 80.598). Agree the total volume 28 U.S.C. 1605(a)(2), but solely with
paragraph (g)(2)(i) of this section are met of tenders from the listings to the diesel respect to actions instituted against the
at the first United States port of entry, fuel inventory reconciliation analysis in foreign refiner, its agents and employees
the requirements of paragraph (g)(2) of § 80.128(b), and to the volumes in any court or other tribunal in the
this section do not apply at subsequent determined by the third party under United States for conduct that violates
ports of entry if the United States paragraph (f)(1) of this section. the requirements applicable to the
importer obtains a certification from the * * * * * foreign refiner under this subpart,
vessel owner that meets the (i) * * * including conduct that violates the
requirements of paragraph (s) of this (1) * * * False Statements Accountability Act of
section, that the vessel has not loaded (v) Inspections and audits by EPA 1996 (18 U.S.C. 1001) and section
any diesel fuel or blendstock between may include review and copying of any 113(c)(2) of the Clean Air Act (42 U.S.C.
the first United States port of entry and documents related to: 7413).
the subsequent port of entry. (A) Refinery baseline establishment, if * * * * *
(2)(i) The requirements of this applicable, including the volume, sulfur (j) Sovereign immunity. By submitting
paragraph (g)(2) apply if— content and dye and marker status of a petition for participation in any diesel
(A) The temperature-corrected diesel fuel, heating oil and other foreign refiner program under this
volumes determined at the port of entry distillates; transfers of title or custody of subpart (and baseline, if applicable)
and at the load port differ by more than any diesel fuel, heating oil or under this section, or by producing and
one percent; or blendstocks whether DFR-Diesel or exporting diesel fuel to the United
(B) The sulfur content value Non-DFR-Diesel, produced at the States under any such program, the
determined at the port of entry is higher foreign refinery during the period foreign refiner, and its agents and
than the sulfur content value January 1, 1998 through the date of the employees, without exception, become
determined at the load port, and the refinery baseline petition or through the subject to the full operation of the
amount of this difference is greater than date of the inspection or audit if a administrative and judicial enforcement
the reproducibility amount specified for baseline petition has not been approved, powers and provisions of the United
the port of entry test result by the and any work papers related to refinery States without limitation based on
American Society of Testing and baseline establishment; sovereign immunity, with respect to
Materials (ASTM) for a test method used (B) The volume and sulfur content of actions instituted against the foreign
for testing the port of entry sample DFR-Diesel; refiner, its agents and employees in any
under the provisions §§ 80.580 through (C) The proper classification of diesel court or other tribunal in the United
80.586. fuel as being DFR-Diesel or as not being States for conduct that violates the
(ii) The United States importer and DFR-Diesel, or as Certified DFR-Diesel requirements applicable to the foreign
the foreign refiner shall treat the diesel or as Non-Certified DFR-Diesel, and all refiner under this subpart including
fuel as Non-Certified DFR-Diesel, and other relevant designations under this conduct that violates the False
the foreign refiner shall exclude the subpart, including § 80.598 and this Statements Accountability Act of 1996
diesel fuel volume from its diesel fuel section; (18 U.S.C. 1001) and section 113(c)(2) of
volumes calculations and sulfur (D) Transfers of title or custody to the Clean Air Act (42 U.S.C. 7413).
standard designations under § 80.598. DFR-Diesel; (k) * * *
(h) Attest requirements. Refiners, for (E) Sampling and testing of DFR- (1) The foreign refiner shall post a
each annual compliance period, must Diesel; bond of the amount calculated using the
arrange to have an attest engagement (F) Work performed and reports following equation:
performed of the underlying prepared by independent third parties Bond = G × $ 0.01
documentation that forms the basis of and by independent auditors under the Where:
any report required under this subpart. requirements of this section, including
Bond = amount of the bond in U.S. dollars
The attest engagement must comply work papers; and G = the applicable volume baseline under
with the procedures and requirements (G) Reports prepared for submission Subpart I for diesel fuel or distillate
that apply to refiners under §§ 80.125 to EPA, and any work papers related to produced at the foreign refinery and
through 80.130, or other applicable such reports. exported to the United States, in gallons.
attest engagement provisions, and must (vi) Inspections and audits by EPA * * * * *
be submitted to the Administrator of may include taking samples of diesel (3) Bonds posted under this paragraph
EPA by August 31 of each year for the fuel, heating oil, other distillates, diesel (k) shall—
prior annual compliance period. The fuel additives or blendstock, dyes and (i) Be used to satisfy any judicial
following additional procedures shall be chemical markers and interviewing judgment that results from an
carried out for any foreign refiner of employees. administrative or judicial enforcement
DFR-Diesel. * * * * * action for conduct in violation of this
* * * * * (5) Submitting a petition for subpart, including where such conduct
(2) Obtain separate listings of all participation in the diesel foreign violates the False Statements
tenders of Certified DFR-Diesel and of refiner program or producing and Accountability Act of 1996 (18 U.S.C.
Non-Certified DFR-Diesel, and obtain exporting diesel fuel or heating oil 1001) and section 113(c)(2) of the Clean
separate listings of Certified DFR-Diesel under any such program, and all other Air Act (42 U.S.C. 7413);
based on whether it is 15 ppm sulfur actions to comply with the requirements (ii) Be provided by a corporate surety
content diesel fuel, 500 ppm sulfur of this subpart relating to participation that is listed in the United States
Department of Treasury Circular 570 number of the foreign refinery that whether it adequately addresses the
‘‘Companies Holding Certificates of produced the DFR-Diesel; following:
Authority as Acceptable Sureties on (C) Determine the name and country (i) Provisions for monitoring pipeline
Federal Bonds;’’ and of registration of the vessel used to shipments, if applicable, from the
(iii) Include a commitment that the transport the DFR-Diesel to the United refinery, that ensure segregation of
bond will remain in effect for at least States; and Certified DFR-Diesel from that refinery
five years following the end of latest (D) Determine the date and time the from all other diesel fuel;
annual reporting period that the foreign vessel arrives at the United States port (ii) Contracts with any terminals and/
refiner produces diesel fuel pursuant to of entry. or pipelines that receive and/or
the requirements of this subpart. (ii) In the case of Certified DFR-Diesel, transport Certified DFR-Diesel, that
* * * * * have an independent third party: prohibit the commingling of Certified
(n) Prohibitions. (1) No person may (A) Collect a representative sample DFR-Diesel with any of the following:
combine Certified DFR-Diesel with any from each vessel compartment (A) Other Certified DFR-Diesel from
Non-Certified DFR-Diesel or Non–DFR- subsequent to the vessel’s arrival at the other refineries.
Diesel, and no person may combine United States port of entry and prior to (B) All Non-Certified DFR-Diesel.
Certified DFR-Diesel with any Certified off loading any diesel fuel from the (C) All Non-DFR-Diesel.
DFR-Diesel produced at a different vessel; (D) All diesel fuel or heating oil
(B) Obtain the compartment samples; products required to be segregated
refinery, until the importer has met all
and under this subpart;
the requirements of paragraph (o) of this
(C) Determine the sulfur content (iii) Procedures for obtaining and
section, except as provided in paragraph
value, and if applicable, the marker reviewing truck loading records and
(e) of this section. No person may
content, of each compartment sample United States import documents for
violate the product segregation
using an appropriate methodology as Certified DFR-Diesel to ensure that such
requirements of § 80.511.
specified in §§ 80.580 through 80.586 by diesel fuel is only loaded into trucks
(2) No foreign refiner or other person
the third party analyzing the sample or making deliveries to the United States;
may cause another person to commit an
by the third party observing the (iv) Attest procedures to be conducted
action prohibited in paragraph (n)(1) of
importer analyze the sample. annually by an independent third party
this section, or that otherwise violates (4) Any importer shall submit reports
the requirements of this section. that review loading records and import
within 30 days following the date any
(o) United States importer documents based on volume
vessel transporting DFR-Diesel arrives at
requirements. Any United States reconciliation, or other criteria, to
the United States port of entry:
importer shall meet the following confirm that all Certified DFR-Diesel
(i) To the Administrator containing
requirements: remains segregated throughout the
the information determined under
(1) Each batch of imported diesel fuel distribution system and is only loaded
paragraph (o)(3) of this section; and
and heating oil shall be classified by the (ii) To the foreign refiner containing into trucks for import into the United
importer as being DFR-Diesel or as Non- the information determined under States.
DFR-Diesel, and each batch classified as paragraph (o)(3)(ii) of this section, and (3) The petition required by this
DFR-Diesel shall be further classified as including identification of the port and section must be submitted to EPA along
Certified DFR-Diesel or as Non-Certified Credit Trading Area at which the with the application for temporary
DFR-Diesel, and each batch of Certified product was offloaded. refiner relief individual refinery diesel
DFR-Diesel shall be further designated (5) Any United States importer shall sulfur standard under this subpart.
pursuant to the designation meet the requirements specified in (q) Withdrawal or suspension of a
requirements of § 80.598 and this §§ 80.510 and 80.520 and all other foreign refinery’s temporary refinery
section. requirements of this subpart, for any flexibility program approval. EPA may
(2) Diesel fuel shall be classified as imported diesel fuel or heating oil that withdraw or suspend a diesel refiner
Certified DFR-Diesel or as Non-Certified is not classified as Certified DFR-Diesel baseline or standard approval for a
DFR-Diesel according to the designation under paragraph (o)(2) of this section. foreign refinery where—
by the foreign refiner if this designation (p) Truck imports of Certified DFR- (1) A foreign refiner fails to meet any
is supported by product transfer Diesel produced at a foreign refinery. (1) requirement of this section;
documents prepared by the foreign Any refiner whose Certified DFR-Diesel (2) A foreign government fails to
refiner as required in paragraph (d) of is transported into the United States by allow EPA inspections as provided in
this section, unless the diesel fuel is truck may petition EPA to use paragraph (i)(1) of this section;
classified as Non-Certified DFR-Diesel alternative procedures to meet the (3) A foreign refiner asserts a claim of,
under paragraph (g) of this section. following requirements: or a right to claim, sovereign immunity
Additionally, the importer shall comply (i) Certification under paragraph (d)(5) in an action to enforce the requirements
with all requirements of this subpart of this section; in this subpart; or
applicable to importers. (ii) Load port and port of entry (4) A foreign refiner fails to pay a civil
(3) For each diesel fuel batch sampling and testing under paragraphs or criminal penalty that is not satisfied
classified as DFR-Diesel, any United (f) and (g) of this section; using the foreign refiner bond specified
States importer shall perform the (iii) Attest under paragraph (h) of this in paragraph (k) of this section.
following procedures. section; and (r) Early use of a foreign refiner motor
(i) In the case of both Certified and (iv) Importer testing under paragraph vehicle diesel fuel baseline. (1) A foreign
Non-Certified DFR-Diesel, have an (o)(3) of this section. refiner may begin using an individual
independent third party: (2) These alternative procedures must refinery baseline under subpart I of this
(A) Determine the volume of diesel ensure Certified DFR-Diesel remains part before EPA has approved the
fuel in the vessel; segregated from Non-Certified DFR- baseline, provided that:
(B) Use the foreign refiner’s DFR- Diesel and from Non-DFR-Diesel until it (i) A baseline petition has been
Diesel certification to determine the is imported into the United States. The submitted as required in paragraph (b)
name and EPA-assigned registration petition will be evaluated based on of this section;
(ii) EPA has made a provisional name of foreign refiner]. Pursuant to Clean CFR 1068.1; those provisions apply
finding that the baseline petition is Air Act section 113(c) and 18 U.S.C. 1001, instead of the provisions of this part 89.
complete; the penalty for furnishing false, incomplete ■ 79. Section 89.2 is amended by adding
(iii) The foreign refiner has made the or misleading information in this
certification or submission is a fine of up to
a definition for ‘‘Sulfur-sensitive
commitments required in paragraph (i) $10,000 U.S., and/or imprisonment for up to technology’’ in alphabetical order to read
of this section; five years. as follows:
(iv) The persons who will meet the
independent third party and § 89.2 Definitions.
PART 86—CONTROL OF EMISSIONS
independent attest requirements for the FROM NEW AND IN-USE HIGHWAY * * * * *
foreign refinery have made the VEHICLES AND ENGINES Sulfur-sensitive technology means an
commitments required in paragraphs emission-control technology that
(f)(3)(iii) and (h)(7)(iii) of this section; ■ 74. The authority citation for part 86 experiences a significant drop in
and continues to read as follows: emission-control performance or
(v) The foreign refiner has met the Authority: 42 U.S.C. 7401—7671(q). emission-system durability when an
bond requirements of paragraph (k) of ■ 75. Section 86.007–35 is amended by engine is operated on low-sulfur fuel
this section. revising paragraph (c) to read as follows: (i.e., fuel with a sulfur concentration up
(2) In any case where a foreign refiner to 500 ppm) as compared to when it is
uses an individual refinery baseline § 86.007–35 Labeling. operated on ultra low-sulfur fuel (i.e.,
before final approval under paragraph * * * * * fuel with a sulfur concentration less
(r)(1) of this section, and the foreign (c) Model year 2007 and later diesel- than 15 ppm). Exhaust-gas recirculation
refinery baseline values that ultimately fueled vehicles must include permanent is not a sulfur-sensitive technology.
are approved by EPA are more stringent readily visible labels on the dashboard * * * * *Ä
than the early baseline values used by (or instrument panel) and near all fuel ■ 80. Section 89.112 is amended by Ä
the foreign refiner, the foreign refiner inlets that state ‘‘Use Ultra Low Sulfur revising the introductory text of Ä
shall recalculate its compliance, ab Diesel Fuel Only’’ or ‘‘Ultra Low Sulfur paragraph (f)(1) and adding paragraph (g) Ä
initio, using the baseline values Diesel Fuel Only’’. to read as follows:Ä
approved by the EPA, and the foreign * * * * *Ä
refiner shall be liable for any resulting ■ 76. Section 86.007–38 is amended by Ä
§ 89.112 Oxides of nitrogen, carbon
violation of the motor vehicle highway monoxide, hydrocarbon, and particulate
revising paragraph (i) to read as follows:Ä matter exhaust emission standards.
diesel fuel requirements.
(s) Additional requirements for § 86.007–38 Maintenance instructions. * * * * *
petitions, reports and certificates. Any * * * * * (f) * * *
petition for approval to produce diesel (i) For each new diesel-fueled engine (1) Voluntary standards. Engines may
fuel subject to the diesel foreign refiner subject to the standards prescribed in be designated ‘‘Blue Sky Series’’ engines
program, any alternative procedures § 86.007–11, as applicable, the by meeting the voluntary standards
under paragraph (p) of this section, any manufacturer shall furnish or cause to listed in Table 3, which apply to all
report or other submission required by be furnished to the ultimate purchaser certification and in-use testing, as
paragraph (c), (f)(2), or (i) of this section, a statement that ‘‘This engine must be follows:
and any certification under paragraph operated only with ultra low-sulfur * * * * *
(d)(3) of this section shall be— diesel fuel (meeting EPA specifications (g) Manufacturers of engines at or
(1) Submitted in accordance with for highway diesel fuel, including a 15 above 37 kW and below 56 kW from
procedures specified by the ppm sulfur cap).’’ model years 2008 through 2012 that are
Administrator, including use of any subject to the standards of this section
forms that may be specified by the PART 89—CONTROL OF EMISSIONS under 40 CFR 1039.102 must take the
Administrator. FROM NEW AND IN-USE NONROAD following additional steps:
(2) Be signed by the president or COMPRESSION-IGNITION ENGINES (1) State the applicable PM standard
owner of the foreign refiner company, or
■ 77. The authority citation for part 89 on the emission control information
by that person’s immediate designee,
continues to read as follows: label.
and shall contain the following
Authority: 42 U.S.C. 7521, 7522, 7523, (2) Add information to the emission-
declaration:
7524, 7525, 7541, 7542, 7543, 7545, 7547, related installation instructions to
I hereby certify: (1) That I have actual 7549, 7550, and 7601(a). clarify the equipment manufacturer’s
authority to sign on behalf of and to bind obligations under 40 CFR 1039.104(f).
[insert name of foreign refiner] with regard to
■ 78. Section 89.1 is amended by adding
paragraph (b)(6) to read as follows: ■ 81. Section 89.114 is amended by
all statements contained herein; (2) that I am
aware that the information contained herein adding a new paragraph (b)(3) to read as
§ 89.1 Applicability. follows:
is being certified, or submitted to the United
States Environmental Protection Agency, * * * * *
(b) * * * § 89.114 Special and alternate test
under the requirements of 40 CFR part 80,
(6) Tier 4 engines. This part does not procedures.
subpart I, and that the information is material
for determining compliance under these apply to engines that are subject to * * * * *
regulations; and (3) that I have read and emission standards under 40 CFR part (b) * * *
understand the information being certified or 1039. See 40 CFR 1039.1 to determine (3) A manufacturer may elect to use
submitted, and this information is true, when that part 1039 applies. Note that the test procedures in 40 CFR part 1065
complete and correct to the best of my
certain requirements and prohibitions as an alternate test procedure without
knowledge and belief after I have taken
reasonable and appropriate steps to verify the apply to engines built on or after advance approval by the Administrator.
accuracy thereof. January 1, 2006 if they are installed in The manufacturer must identify in its
I affirm that I have read and understand the stationary applications or in equipment application for certification that the
provisions of 40 CFR part 80, subpart I, that will be used solely for competition, engines were tested using the
including 40 CFR 80.620 apply to [insert as described in 40 CFR 1039.1 and 40 procedures in 40 CFR part 1065.
■ 82. Section 89.203 is amended by manufacturer demonstrates that the in- such as the engine block. This label
adding a new paragraph (c)(6) to read as use engines will use only fuel with 15 must include at least the following
follows: ppm or less of sulfur. items:
(5) Instead of the test fuels described (1) The label heading ‘‘EMISSION
§ 89.203 General provisions. in paragraphs (e)(2) through (4) of this CONTROL INFORMATION’’.
* * * * * section, for model years 2008 and later,
(c) * * * (2) Your corporate name and
manufacturers may use the test fuel trademark.
(6) Model year 2008 and 2009 engines described in appendix A of this subpart.
rated under 8 kW that are allowed to In such cases, the test fuel described in (3) Engine displacement, engine
certify under this part because they appendix A of this subpart shall be the family identification (as applicable), and
meet the criteria in 40 CFR 1039.101(c) test fuel for all manufacturer and EPA model year of the engine or whom to
may not generate emission credits. testing. contact for further information.
■ 83. Section 89.330 is amended by ■ 84. Section 89.908 is amended by (4) The statement ‘‘THIS ENGINE
revising paragraph (b)(3) and adding adding paragraph (c) to read as follows: HAS AN EXEMPTION FOR NATIONAL
paragraph (e) to read as follows: SECURITY UNDER 40 CFR 94.908.’’.
§ 89.908 National security exemption.
§ 89.330 Lubricating oil and test fuels. ■ 88. A new part 1039 is added to
* * * * * subchapter U of chapter I, to read as
* * * * * (c) Manufacturers must add a legible
(b) * * * follows:
label, written in block letters in English,
(3) Testing of Tier 1 and Tier 2 to each engine exempted under this SUBCHAPTER U—AIR POLLUTION
engines rated under 37 kW and Tier 2 section. The label must be permanently CONTROLS
and Tier 3 engines rated at or above 37 secured to a readily visible part of the
kW that is conducted by the PART 1039—CONTROL OF EMISSIONS
engine needed for normal operation and FROM NEW AND IN-USE NONROAD
Administrator shall be performed using not normally requiring replacement,
test fuels that meet the specifications in COMPRESSION-IGNITION ENGINES
such as the engine block. This label
Table 4 in Appendix A of this subpart must include at least the following Subpart A—Overview and Applicability
and that have a sulfur content no higher items:
than 0.20 weight percent. Sec. Ä
(1) The label heading ‘‘EMISSION 1039.1 Does this part apply for my engines? Ä
* * * * * CONTROL INFORMATION’’. 1039.5 Which engines are excluded from Ä
(e) Low-sulfur test fuel. (1) Upon (2) Your corporate name and this part’s requirements?
request, for engines rated at or above 75 trademark. 1039.10 How is this part organized?
kW in model years 2006 or 2007, the (3) Engine displacement, engine 1039.15 Do any other regulation parts apply
diesel test fuel may be the low-sulfur family identification (as applicable), and to me?
diesel test fuel specified in 40 CFR part 1039.20 What requirements from this part
model year of the engine or whom to
1065, subject to the provisions of this apply to excluded stationary engines?
contact for further information.
paragraph (e)(1). (4) The statement ‘‘THIS ENGINE Subpart B—Emission Standards and
(i) To use this option, the HAS AN EXEMPTION FOR NATIONAL Related Requirements
manufacturer must— SECURITY UNDER 40 CFR 89.908.’’. 1039.101 What exhaust emission standards
(A) Ensure that ultimate purchasers of ■ 85. Section 89.910 is amended by must my engines meet after the 2014
equipment using these engines are adding paragraph (c) to read as follows: model year?
informed that the use of fuel meeting 1039.102 What exhaust emission standards
the 500 ppm specification is § 89.910 Granting of exemptions. and phase-in allowances apply for my
recommended. * * * * * engines in model year 2014 and earlier?
(B) Recommend to equipment 1039.104 Are there interim provisions that
(c) Manufacturers may ask EPA to
manufacturers that a label be applied at apply only for a limited time?
apply the provisions of 40 CFR 1039.105 What smoke standards must my
the fuel inlet recommending 500 ppm 1068.201(i) to engines exempted or engines meet?
fuel. excluded under this subpart. 1039.107 What evaporative emission
(ii) None of the engines in the engine standards and requirements apply?
family may employ sulfur-sensitive PART 94—CONTROL OF AIR 1039.110 [Reserved]
technologies. POLLUTION FROM MARINE 1039.115 What other requirements must my
(iii) For engines rated at or above 130 COMPRESSION-IGNITION ENGINES engines meet?
kW, this option may be used in 2006 1039.120 What emission-related warranty
and 2007. For engines rated at or above ■ 86. The authority citation for part 94 requirements apply to me?
75 kW and under 130 kW, this option continues to read as follows: 1039.125 What maintenance instructions
Authority: 42 U.S.C. 7522, 7523, 7524, must I give to buyers?
may be used only in 2007.
7525, 7541, 7542, 7543, 7545, 7547, 7549, 1039.130 What installation instructions
(2) For model years 2008 through must I give to equipment manufacturers?
2010, except as otherwise provided, the 7550, and 7601(a).
1039.135 How must I label and identify the
diesel test fuel shall be the low-sulfur ■ 87. Section 94.908 is amended by engines I produce?
diesel test fuel specified in 40 CFR part adding paragraph (c) to read as follows: 1039.140 What is my engine’s maximum
1065. engine power?
(3) The diesel test fuel shall be the § 94.908 National security exemption.
Subpart C—Certifying Engine Families
ultra low-sulfur diesel test fuel specified * * * * *
in 40 CFR part 1065 for model years (c) Manufacturers must add a legible 1039.201 What are the general requirements
label, written in block letters in English, for obtaining a certificate of conformity?
2011 and later.
1039.205 What must I include in my
(4) For model years 2007 through to each engine exempted under this application?
2010 engines that use sulfur-sensitive section. The label must be permanently 1039.210 May I get preliminary approval
emission-control technology, the diesel secured to a readily visible part of the before I complete my application?
test fuel is the ultra low-sulfur fuel engine needed for normal operation and 1039.220 How do I amend the maintenance
specified in 40 CFR part 1065 if the not normally requiring replacement, instructions in my application?
1039.225 How do I amend my application or the Commonwealth of the Northern TABLE 1 OF § 1039.1.—P ART 1039
for certification to include new or Mariana Islands?
modified engines?
APPLICABILITY BY MODEL YEAR—
1039.660 What special provisions apply to
1039.230 How do I select engine families? Independent Commercial Importers? Continued
1039.235 What emission testing must I
perform for my application for a Subpart H—Averaging, Banking, and Power category Model year
certificate of conformity? Trading for Certification
1039.240 How do I demonstrate that my 1039.701 General provisions. 56 ≤ kW < 130 .......................... 2012
engine family complies with exhaust 1039.705 How do I generate and calculate 130 ≤ kW ≤ 560 ........................ 2011
emission standards? emission credits? kW > 560 .................................. 2011
1039.245 How do I determine deterioration 1039.710 How do I average emission 1 As described in § 1039.102, some engines
factors from exhaust durability testing? credits? below 19 kW may not be subject to the emis
1039.250 What records must I keep and 1039.715 How do I bank emission credits? sion standards in this part until the 2010
what reports must I send to EPA? 1039.720 How do I trade emission credits? model year.
1039.255 What decisions may EPA make 1039.725 What must I include in my 2 As described in § 1039.102, some engines
regarding my certificate of conformity? application for certification? in the 19–56 kW power category may not be
1039.260 What provisions apply to engines 1039.730 What ABT reports must I send to subject to the emission standards in this part
that are conditionally exempted from EPA? until the 2012 model year.
certification? 1039.735 What records must I keep? (2) If you use the provisions of
1039.740 What restrictions apply for using § 1039.104(a) to certify an engine to the
Subpart D—[Reserved]
emission credits? emission standards of this part before
Subpart E—In-use Testing 1039.745 What can happen if I do not
the model years shown in Table 1 of this
1039.401 General provisions. comply with the provisions of this
subpart? section, all the requirements of this part
Subpart F—Test Procedures apply for those engines.
Subpart I—Definitions and Other Reference (3) See 40 CFR part 89 for
1039.501 How do I run a valid emission Information
test? requirements that apply to engines not
1039.505 How do I test engines using 1039.801 What definitions apply to this yet subject to the requirements of this
steady-state duty cycles, including part? part 1039.
ramped-modal testing? 1039.805 What symbols, acronyms, and (4) This part 1039 applies for other
1039.510 Which duty cycles do I use for abbreviations does this part use? compression-ignition engines as
transient testing? 1039.810 What materials does this part follows:
1039.515 What are the test procedures reference?
(i) The provisions of paragraph (c) of
related to not-to-exceed standards? 1039.815 What provisions apply to
confidential information? this section and § 1039.801 apply for
1039.520 What testing must I perform to
1039.820 How do I request a hearing? stationary engines beginning January 1,
establish deterioration factors?
1039.525 How do I adjust emission levels to Appendix I to Part 1039—[Reserved] 2006.
account for infrequently regenerating Appendix II to Part 1039—Steady-state Duty (ii) The provisions of § 1039.620 and
aftertreatment devices? Cycles for Constant-Speed Engines § 1039.801 apply for engines used solely
Appendix III to Part 1039—Steady-state Duty for competition beginning January 1,
Subpart G—Special Compliance Provisions Cycles for Variable-Speed Engines with 2006.
1039.601 What compliance provisions Maximum Power below 19 kW (c) The definition of nonroad engine
apply to these engines? Appendix IV to Part 1039—Steady-state Duty in 40 CFR 1068.30 excludes certain
1039.605 What provisions apply to engines Cycles for Variable-Speed Engines with engines used in stationary applications.
already certified under the motor-vehicle Maximum Power at or above 19 kW
program? Appendix V to Part 1039—[Reserved]
These engines are not required to
1039.610 What provisions apply to vehicles Appendix VI to Part 1039—Nonroad comply with this part, except for the
already certified under the motor-vehicle Compression-ignition Composite requirements in § 1039.20. In addition,
program? Transient Cycle the prohibitions in 40 CFR 1068.101
1039.615 What special provisions apply to Authority: 42 U.S.C. 7401–7671(q).
restrict the use of stationary engines for
engines using noncommercial fuels? nonstationary purposes.
1039.620 What are the provisions for Subpart A—Overview and Applicability (d) In certain cases, the regulations in
exempting engines used solely for this part 1039 apply to engines at or
competition? § 1039.1 Does this part apply for my above 250 kW that would otherwise be
1039.625 What requirements apply under engines? covered by 40 CFR part 1048. See 40
the program for equipment-manufacturer
(a) The regulations in this part 1039 CFR 1048.620 for provisions related to
flexibility?
1039.626 What special provisions apply to apply for all new, compression-ignition this allowance.
equipment imported under the nonroad engines (defined in
§ 1039.801), except as provided in § 1039.5 Which engines are excluded from
equipment-manufacturer flexibility
this part’s requirements?
program? § 1039.5.
1039.627 What are the incentives for (b) This part 1039 applies as follows: This part does not apply to the
equipment manufacturers to use cleaner (1) This part 1039 applies for all following nonroad engines:
engines? engines subject to the emission (a) Locomotive engines. (1) The
1039.630 What are the economic hardship standards specified in subpart B of this following locomotive engines are not
provisions for equipment manufacturers? part starting with the model years noted subject to the provisions of this part
1039.635 What are the hardship provisions 1039:
for engine manufacturers? (i) Engines in locomotives subject to
1039.640 What special provisions apply to the standards of 40 CFR part 92.
branded engines? TABLE 1 OF § 1039.1.—P ART 1039
(ii) Engines in locomotives that are
1039.645 What special provisions apply to APPLICABILITY BY MODEL YEAR
engines used for transportation
exempt from the standards of 40 CFR
refrigeration units? Power category Model year part 92 pursuant to the provisions of 40
1039.650 [Reserved] CFR part 92 (except for the provisions
1039.655 What special provisions apply to kW < 19 .................................... 1 2008 of 40 CFR 92.907). For example, an
engines sold in Guam, American Samoa, 19 ≤ kW < 56 ............................ 2 2008 engine that is exempt under 40 CFR
92.906 because it is in a manufacturer- § 1039.102 and § 1039.104 discuss or import that is excluded under
owned locomotive is not subject to the certain interim requirements and § 1039.1(c) as a stationary engine. To
provisions of this part 1039. compliance provisions that apply only meet labeling requirements, you must
(2) The following locomotive engines for a limited time. do the following things:
are subject to the provisions of this part (c) Subpart C of this part describes (1) Attach the label or tag in one piece
1039: how to apply for a certificate of so no one can remove it without
(i) Engines in locomotives exempt conformity. destroying or defacing it.
from 40 CFR part 92 pursuant to the (d) [Reserved] (2) Secure it to a part of the engine
provisions of 40 CFR 92.907. (e) Subpart E of this part describes needed for normal operation and not
(ii) Locomotive engines excluded general provisions for testing in-use normally requiring replacement.
from the definition of locomotive in 40 engines. (3) Make sure it is durable and
CFR 92.2. (f) Subpart F of this part describes readable for the engine’s entire life.
(b) Marine engines. (1) The following how to test your engines (including (4) Write it in English.
marine engines are not subject to the references to other parts of the Code of (5) Follow the requirements in
provisions of this part 1039: Federal Regulations). § 1039.135(g) regarding duplicate labels
(i) Engines subject to the standards of (g) Subpart G of this part and 40 CFR if the engine label is obscured in the
40 CFR part 94. part 1068 describe requirements, final installation.
(ii) Engines not subject to the prohibitions, and other provisions that (b) Engine labels or tags required
standards of 40 CFR part 94 only apply to engine manufacturers, under this section must have the
because they were produced before the equipment manufacturers, owners, following information:
standards of 40 CFR part 94 started to (1) Include the heading ‘‘EMISSION
operators, rebuilders, and all others.
apply. CONTROL INFORMATION’’.
(h) Subpart H of this part describes (2) Include your full corporate name
(iii) Engines that are exempt from the how you may generate and use emission
standards of 40 CFR part 94 pursuant to and trademark. You may instead
credits to certify your engines. include the full corporate name and
the provisions of 40 CFR part 94 (except (i) Subpart I of this part contains
for the provisions of 40 CFR 94.907). For trademark of another company you
definitions and other reference choose to designate.
example, an engine that is exempt under information.
40 CFR 94.906 because it is a (3) State the engine displacement (in
manufacturer-owned engine is not § 1039.15 Do any other regulation parts liters) and maximum engine power.
apply to me? (4) State: ‘‘THIS ENGINE IS
subject to the provisions of this part
(a) Part 1065 of this chapter describes EXCLUDED FROM THE
1039.
procedures and equipment REQUIREMENTS OF 40 CFR PART
(iv) Engines with rated power below
specifications for testing engines. 1039 AS A ‘‘STATIONARY ENGINE.’’
37 kW.
(v) Engines on foreign vessels. Subpart F of this part 1039 describes INSTALLING OR USING THIS ENGINE
(2) Marine engines are subject to the how to apply the provisions of part 1065 IN ANY OTHER APPLICATION MAY
provisions of this part 1039 if they are of this chapter to determine whether BE A VIOLATION OF FEDERAL LAW
exempt from 40 CFR part 94 based on engines meet the emission standards in SUBJECT TO CIVIL PENALTY.’’.
the engine-dressing provisions of 40 this part. Subpart B—Emission Standards and
CFR 94.907. (b) The requirements and prohibitions Related Requirements
(c) Mining engines. Engines used in of part 1068 of this chapter apply to
underground mining or in underground everyone, including anyone who § 1039.101 What exhaust emission
mining equipment and regulated by the manufactures, imports, installs, owns, standards must my engines meet after the
Mining Safety and Health operates, or rebuilds any of the engines 2014 model year?
Administration in 30 CFR parts 7, 31, subject to this part 1039, or equipment The exhaust emission standards of
32, 36, 56, 57, 70, and 75 are not subject containing these engines. Part 1068 of this section apply after the 2014 model
to the provisions of this part 1039. this chapter describes general year. Certain of these standards also
(d) Hobby engines. Engines with per- provisions, including these seven areas: apply for model year 2014 and earlier.
cylinder displacement below 50 cubic (1) Prohibited acts and penalties for This section presents the full set of
centimeters are not subject to the engine manufacturers, equipment emission standards that apply after all
provisions of this part 1039. manufacturers, and others. the transition and phase-in provisions of
(2) Rebuilding and other aftermarket § 1039.102 and § 1039.104 expire. See
§ 1039.10 How is this part organized? § 1039.102 and 40 CFR 89.112 for
changes.
The regulations in this part 1039 (3) Exclusions and exemptions for exhaust emission standards that apply
contain provisions that affect both certain engines. to 2014 and earlier model years. Section
engine manufacturers and others. (4) Importing engines. 1039.105 specifies smoke standards.
However, the requirements of this part (5) Selective enforcement audits of (a) Emission standards for transient
are generally addressed to the engine your production. testing. Transient exhaust emissions
manufacturer. Unless we specifically (6) Defect reporting and recall. from your engines may not exceed the
state otherwise, the term ‘‘you’’ means (7) Procedures for hearings. applicable emission standards in Table
the engine manufacturer, as defined in (c) Other parts of this chapter apply 1 of this section. Measure emissions
§ 1039.801. This part 1039 is divided if referenced in this part. using the applicable transient test
into the following subparts: procedures described in subpart F of
(a) Subpart A of this part defines the § 1039.20 What requirements from this this part. The following engines are not
applicability of part 1039 and gives an part apply to excluded stationary engines?
subject to the transient standards in this
overview of regulatory requirements. The provisions of this section apply paragraph (a):
(b) Subpart B of this part describes the for engines built on or after January 1, (1) Engines above 560 kW.
emission standards and other 2006. (2) Constant-speed engines.
requirements that must be met to certify (a) You must add a permanent label (b) Emission standards for steady-
engines under this part. Note that or tag to each new engine you produce state testing. Steady-state exhaust
emissions from your engines may not standards in Table 1 of this section. steady-state test procedures described in
exceed the applicable emission Measure emissions using the applicable subpart F of this part.
TABLE 1 OF § 1039.101.—T IER 4 EXHAUST EMISSION STANDARDS AFTER THE 2014 MODEL YEAR, G/KW-HR 1
Maximum engine power Application PM NOX NMHC NOX+NMHC CO
kW < 19 ....................................... All ................................................ 2 0.40 ...................... .................... 7.5 3 6.6
19 ≤ kW < 56 ............................... All ................................................ 0.03 ...................... .................... 4.7 4 5.0
56 ≤ kW < 130 ............................. All ................................................ 0.02 0.40 0.19 .................... 5.0
130 ≤ kW ≤ 560 ........................... All ................................................ 0.02 0.40 0.19 .................... 3.5
Generator sets ............................ 0.03 0.67 0.19 .................... 3.5
kW > 560 ..................................... All except generator sets ............ 0.04 3.5 0.19 .................... 3.5
1 Note that some of these standards also apply for 2014 and earlier model years. This table presents the full set of emission standards that
apply after all the transition and phase-in provisions of § 1039.102 expire.
2 See paragraph (c) of this section for provisions related to an optional PM standard for certain engines below 8 kW.
3 The CO standard is 8.0 g/kW-hr for engines below 8 kW.
4 The CO standard is 5.5 g/kW-hr for engines below 37 kW.
(c) Optional PM standard for engines provisions of subpart H of this part. emission standards for the engine family Ä
below 8 kW. You may certify hand- These engines may use PM or with respect to all required testing Ä
startable, air-cooled, direct injection NOX+NMHC emission credits, subject to instead of the standards specified in Ä
engines below 8 kW to an optional Tier the FEL caps in paragraph (d)(1) of this paragraphs (a) and (b) of this section.Ä
4 PM standard of 0.60 g/kW-hr. The section. The FELs determine the not-to-exceed Ä
term hand-startable generally refers to (d) Averaging, banking, and trading. standards for your engine family, asÄ
engines that are started using a hand You may generate or use emission specified in paragraph (e) of thisÄ
crank or pull cord. This PM standard credits under the averaging, banking, section. Ä
applies to both steady-state and and trading (ABT) program, as described Ä
transient testing, as described in in subpart H of this part. This requires (1) Primary FEL caps. The FEL may Ä
paragraphs (a) and (b) of this section. that you specify a family emission limit not be higher than the limits in Table 2 Ä
Engines certified under this paragraph (FEL) for each pollutant you include in of this section, except as allowed by Ä
(c) may not be used to generate PM or the ABT program for each engine paragraph (d)(2) of this section or by Ä
NOX+NMHC emission credits under the family. These FELs serve as the § 1039.102:Ä
TABLE 2 OF § 1039.101.—T IER 4 FEL CAPS AFTER THE 2014 MODEL YEAR, G/KW-HR
Maximum engine power Application PM NOX NOX+NMHC
kW < 19 ................................................................ All ......................................................................... 0.80 .................... 1 9.5
19 ≤ kW < 56 ........................................................ All ......................................................................... 0.05 .................... 7.5

56 ≤ kW < 130 ...................................................... All ......................................................................... 0.04 0.80 ....................
130 ≤ kW ≤ 560 .................................................... All ......................................................................... 0.04 0.80 ....................
kW > 560 .............................................................. Generator sets ..................................................... 0.05 1.07 ....................
All except generator sets ..................................... 0.07 6.2 ....................
1 For engines below 8 kW, the FEL cap is 10.5 g/kW-hr for NOX+NMHC emissions.
(2) Alternate FEL caps. For a given this section instead of the FEL caps directed production volume in a given
power category, you may use the identified in paragraph (d)(1) of this model year.
alternate FEL caps shown in Table 3 of section for up to 5 percent of your U.S.-
Starting PM FEL NOX FEL

Maximum engine power model year 1 cap cap
19 ≤ kW < 56 ........................................................................................................................................... 2 2016 0.30 ....................

56 ≤ kW < 130 ......................................................................................................................................... 2016 3 0.30 3 3.8
130 ≤ kW ≤ 560 ....................................................................................................................................... 2015 0.20 3.8

kW > 560 ................................................................................................................................................. 2019 0.10 4 3.5
1 See § 1039.104(g) for alternate FEL caps that apply in earlier model years.
2 For manufacturers certifying engines under Option #1 of Table 3 of § 1039.102, these alternate FEL caps apply starting with the 2017 model
year.
3 For engines below 75 kW, the FEL caps are 0.40 g/kW-hr for PM emissions and 4.4 g/kW-hr for NO emissions.
X
4 For engines above 560 kW, the provision for alternate NO FEL caps is limited to generator-set engines. For example, if you produce 1,000
X
generator-set engines above 560 kW in a given model year, up to 50 of them may be certified to the alternate NOX FEL caps.
(e) Not-to-exceed standards. Exhaust (1) Measure emissions using the rounded to the same number of decimal
emissions from your engines may not procedures described in subpart F of places as the applicable standard in
exceed the applicable not-to-exceed this part. Table 1 of this section, is determined
(NTE) standards in this paragraph (e). (2) Except as noted in paragraph (e)(7) from the following equation:
of this section, the NTE standard,
NTE standard for each pollutant = (STD) × certify without using ABT for that (3) The NTE multiplier for each
(M) pollutant; or the FEL for that pollutant if pollutant is 1.25, except in the following
Where: you certify using ABT. cases:
STD = The standard specified for that M = The NTE multiplier for that pollutant,
pollutant in Table 1 of this section (or as defined in paragraph (e)(3) of this
paragraph (c) of this section) if you section.
If . . . Or . . . Then . . .
(i) The engine family is certified to a NOX The engine family is certified to a NOX FEL The multiplier for NOX, NMHC, and
standard less than 2.50 g/kW-hr without less than 2.50 g/kW-hr or a NOX+NMHC NOX+NMHC is 1.50.
using ABT. FEL less than 2.70 g/kW-hr.
(ii) The engine family is certified to a PM stand The engine family is certified to a PM FEL The multiplier for PM is 1.50.
ard less than 0.07 g/kW-hr without using less than 0.07 g/kW-hr.
ABT.
(4) There are two sets of specifications A = altitude in feet above sea level (A is (f) Fuel types. The exhaust emission
of ambient operating regions that will negative for altitudes below sea level). standards in this section apply for
apply for all NTE testing of engines in (5) Temperature and humidity ranges engines using the fuel type on which the
an engine family. You must choose one for which correction factors are allowed engines in the engine family are
set for each engine family and must are specified in 40 CFR 86.1370– designed to operate, except for engines
identify your choice of ambient 2007(e). certified under § 1039.615. For engines
operating regions in each application for (i) If you choose the ambient certified under § 1039.615, the
certification for an engine family. You operating region specified in paragraph standards of this section apply to
may choose separately for each engine (e)(4)(i) of this section, the temperature emissions measured using the specified
family. Choose one of the following and humidity ranges for which test fuel. You must meet the numerical
ambient operating regions: correction factors are allowed are emission standards for NMHC in this
(i) All altitudes less than or equal to defined in 40 CFR 86.1370–2007(e)(1). section based on the following types of
5,500 feet above sea level during all (ii) If you choose the ambient hydrocarbon emissions for engines
ambient temperature and humidity operating region specified in paragraph powered by the following fuels:
conditions. (e)(4)(ii) of this section, the temperature
and humidity ranges for which (1) Alcohol-fueled engines: THCE
(ii) All altitudes less than or equal to emissions.
5,500 feet above sea level, for correction factors are allowed are
temperatures less than or equal to the defined in 40 CFR 86.1370–2007(e)(2). (2) Other engines: NMHC emissions.
(6) For engines equipped with
temperature determined by the (g) Useful life. Your engines must
exhaust-gas recirculation, the NTE
following equation at the specified meet the exhaust emission standards in
standards of this section do not apply
altitude: paragraphs (a) through (e) of this section
during the cold operating conditions
T = ¥0.00254 × A + 100 specified in 40 CFR 86.1370–2007(f). over their full useful life.
Where: (7) For engines certified to a PM FEL (1) The useful life values are shown
T = ambient air temperature in degrees less than or equal to 0.01 g/kW-hr, the in the following table, except as allowed
Fahrenheit. PM NTE standard is 0.02 g/kW-hr. by paragraph (g)(2) of this section:
TABLE 4 OF § 1039.101—U SEFUL LIFE VALUES

If your engine is certified as . . . And its maximum power is . . . And its rated speed is . . . Then its useful life is . . .
(i) Variable speed or constant kW <19 ......................................... Any Speed .................................... 3,000 hours or five years, which-
speed. ever comes first.
(ii) Constant speed ......................... 19 ≤ kW <37 ................................. 3,000 rpm or higher ...................... 3,000 hours or five years, which-
ever comes first.
(iii) Constant speed ........................ 19 ≤ kW <37 ................................. Less than 3,000 rpm .................... 5,000 hours or seven years,
whichever comes first.
(iv) Variable .................................... 19 ≤ kW <37 ................................. Any Speed .................................... 5,000 hours or seven years,
whichever comes first.
(v) Variable speed or constant kW ≥37 ......................................... Any speed ..................................... 8,000 hours or ten years, which-
speed. ever comes first.
(2) You may request in your any overhaul interval that you §§ 1039.505 and 1039.510. The NTE
application for certification that we recommend and any mechanical standards of this section apply for those
approve a shorter useful life for an warranty that you offer for the engine. tests. We will not direct you to do
engine family. We may approve a (h) Applicability for testing. The additional testing under a selective
shorter useful life if we determine that emission standards in this subpart apply enforcement audit to show that your
these engines will rarely operate longer to all testing, including certification, engines meet the NTE standards.
than the alternate useful life. Your selective enforcement audits, and in-use
demonstration must include testing. For selective enforcement
documentation from in-use engines. audits, we will require you to perform
Your demonstration must also include duty-cycle testing as specified in
§ 1039.102 What exhaust emission (1) The transient standards in this (v) Engines above 560 kW.
standards and phase-in allowances apply section do not apply for the following
for my engines in model year 2014 and (2) The transient standards in this
engines: section for gaseous pollutants do not
earlier? (i) Engines below 37 kW for model
The exhaust emission standards of apply to phase-out engines that you
years before 2013. certify to the same numerical standards
this section apply for 2014 and earlier (ii) Engines certified under Option #1
model years. See § 1039.101 for exhaust (and FELs if the engines are certified
of Table 3 of this section. These are the
emission standards that apply to later using ABT) for gaseous pollutants as
small-volume manufacturer engines
model years. See 40 CFR 89.112 for you certified under the Tier 3
certified to the Option #1 standards for
exhaust emission standards that apply requirements of 40 CFR part 89.
model years 2008 through 2015 under
to model years before the standards of However, except as specified by
§ 1039.104(c), and other engines
this part 1039 take effect. paragraph (a)(1) of this section, the
certified to the Option #1 standards for
(a) Emission standards for transient transient PM emission standards apply
model years 2008 through 2012.
testing. Transient exhaust emissions (iii) Engines certified to an alternate to these engines.
from your engines may not exceed the FEL during the first four years of the (b) Emission standards for steady-state
applicable emission standards in Tables Tier 4 standards for the applicable testing. Steady-state exhaust emissions
1 through 6 of this section. Measure power category, as allowed in from your engines may not exceed the
emissions using the applicable transient § 1039.104(g). However, you may certify applicable emission standards in Tables
test procedures described in subpart F these engines to the transient standards 1 through 7 of this section. Measure
of this part. See paragraph (c) of this in this section to avoid using temporary emissions using the applicable steady-
section for a description of provisions compliance adjustment factors, as state test procedures described in
related to the phase-in and phase-out described in § 1039.104(g)(2). Note that subpart F of this part. See paragraph (c)
standards shown in Tables 4 through 6 in some cases this four-year period of this section for a description of
of this section. The emission standards extends into the time covered by the provisions related to the phase-in and
for transient testing are limited for standards in § 1039.101. phase-out standards shown in Tables 4
certain engines, as follows: (iv) Constant-speed engines. through 6 of this section.
TABLE 1 OF § 1039.102.—T IER 4 EXHAUST EMISSION STANDARDS (G/KW-HR): KW < 19

NOX +
Maximum engine power Model years PM CO
NMHC
kW < 8 ............................................................................................................................. 2008–2014 1 0.40 7.5 8.0

8 ≤ kW < 19 ..................................................................................................................... 2008–2014 0.40 7.5 6.6
1 For engines that qualify for the special provisions in § 1039.101(c), you may delay certifying to the standards in this part 1039 until 2010. In
2009 and earlier model years, these engines must instead meet the applicable Tier 2 standards and other requirements from 40 CFR part 89.
Starting in 2010, these engines must meet a PM standard of 0.60 g/kW-hr, as described in § 1039.101(c). Engines certified to the 0.60 g/kWhr
PM standard may not generate ABT credits.
TABLE 2 OF § 1039.102.—I NTERIM TIER 4 EXHAUST EMISSION STANDARDS (G/KW-HR): 19 ≤ KW < 37

NOX +
Model years PM CO
NMHC
2008–2012 ............................................................................................................................................... 0.30 7.5 5.5

2013–2014 ............................................................................................................................................... 0.03 4.7 5.5

NOX +
Option 1 Model years PM CO
NMHC
#1 ..................................................................................................................................... 2008–2012 0.30 4.7 5.0

#2 ..................................................................................................................................... 2012 0.03 4.7 5.0
All ..................................................................................................................................... 2013–2014 0.03 4.7 5.0
1You may certify engines to the Option #1 or Option #2 standards starting in the listed model year. Under Option #1, all engines at or above
37 kW and below 56 kW produced before the 2013 model year must meet the applicable Option #1 standards in this table. These engines are
considered to be ‘‘Option #1 engines.’’ Under Option #2, all these engines produced before the 2012 model year must meet the applicable stand
ards under 40 CFR part 89. Engines certified to the Option #2 standards in model year 2012 are considered to be ‘‘Option #2 engines.’’

NOX +
Model years 1 Phase-in option PM NOX NMHC CO
NMHC
Phase-in ....................................... 0.02 0.40 0.19 .................... 5.0

2012–2013 .................................... Phase-out ..................................... 0.02 .................... .................... 4.7 5.0
2014 .............................................. All engines .................................... 0.02 0.40 0.19 .................... 5.0
1 See paragraph (d)(2) of this section for provisions that allow for a different phase-in schedule than that specified in paragraph (c)(1) of this
section.
NOX +
NMHC
Phase-in ....................................... 0.02 0.40 0.19 .................... 5.0

2012–2013 .................................... Phase-out ..................................... 0.02 .................... .................... 4.0 5.0
2014 .............................................. All engines .................................... 0.02 0.40 0.19 .................... 5.0
1 See paragraph (d)(2) of this section for provisions that allow for a different phase-in schedule than that specified in paragraph (c)(1) of this
section.
NOX +
NMHC
Phase-in ....................................... 0.02 0.40 0.19 .................... 3.5

2011–2013 .................................... Phase-out ..................................... 0.02 .................... .................... 4.0 3.5
2014 .............................................. All engines .................................... 0.02 0.40 0.19 .................... 3.5
TABLE 7 OF § 1039.102.—I NTERIM TIER 4 EXHAUST EMISSION STANDARDS (G/KW-HR): KW > 560
Model years Maximum engine power Application PM NOX NMHC CO
560 < kW ≤ 900 ................ All ...................................... 0.10 3.5 0.40 3.5
Generator sets .................. 0.10 0.67 0.40 3.5
2011–2014 ........................ kW > 900 .......................... All except generator sets .. 0.10 3.5 0.40 3.5
(c) Phase-in requirements. The engines of an actual 10,000 engines, you standard that is identified in this section
following phase-in provisions apply for must produce 500 engines in model year as a phase-in standard and the term
engines in 56–560 kW power categories 2013 (i.e., the final year of the phase-in ‘‘phase-out’’ means relating to a
meeting the interim Tier 4 standards in for this power category) that meet the standard that is identified in this section
paragraphs (a) and (b) of this section: Tier 4 phase-in standards above and as a phase-out standard. For example, a
(1) For each model year before 2014 beyond the production otherwise 200–kW engine from the 2012 model
noted in Tables 4 through 6 of this needed to meet the 50-percent phase-in year that is certified to the 4.0 g/kW-hr
section, you must certify engine families requirement for model year 2013. If any NOX+NMHC standard in Table 6 of
representing at least 50 percent of your shortfall exceeds the applicable limit of § 1039.102 is a phase-out engine.
U.S.-directed production volume for paragraph (c)(3)(i) or (ii) of this section, (d) Banked credits and alternate
each power category to the applicable that number of phase-out engines will phase-in for 56–130 kW engines. For
phase-in standards, except as allowed be considered not covered by a engines in the 56–130 kW power
by paragraph (c)(3), (d)(2), or (e) of this certificate of conformity and in violation category, you may use only one of the
section. Any engines not certified to the of § 1068.101(a)(1). The shortfall following additional provisions:
phase-in standards must be certified to allowed by this paragraph (c)(3) may not (1) For model years 2012 through
the corresponding phase-out standards. exceed a certain number of engines, as 2014, you may use banked NOX+NMHC
(2) Engines certified to the phase-out follows: credits from any Tier 2 engine at or
standards in Tables 4 through 6 of this (i) For engine families certified above 37 kW certified under 40 CFR
section must comply with all other according to the alternate phase-in part 89 to meet the NOX phase-in
requirements that apply to Tier 4 schedule described in paragraph (d)(2) standards or the NOX+NMHC phase-out
engines, except as otherwise specified of this section, for model years prior to standards under paragraphs (b) and (c)
in this section. the final year of the phase-in, 5 percent of this section, subject to the additional
(3) At the time of certification, show of your actual U.S.-directed production ABT provisions in § 1039.740.
how you intend to meet the phase-in volume for that power category in that (2) Instead of meeting the phase-in
requirements of this paragraph (c) based model year. requirements of paragraph (c)(1) of this
on projected U.S.-directed production (ii) For all other engine families, for section, you may certify engine families
volumes. If your actual U.S.-directed model years prior to the final year of the representing at least 25 percent of your
production volume fails to meet the phase-in, 25 percent of your actual U.S.- U.S.-directed production volume for
phase-in requirements for a given model directed production volume for that each model year from 2012 through
year, you must make up the shortfall (in power category in that model year. 2014 to the applicable phase-in
terms of number of engines) by the end (iii) No shortfall is allowed in the standards in Tables 4 and 5 of this
of the model year representing the final final year of the phase-in. section, except as allowed by paragraph
year of the phase-in period. For (4) Engines you introduce into (c)(3) or (e) of this section. Any engines
example, if you plan in good faith to commerce beyond the limits described not certified to the phase-in standards
produce 50 percent of a projected in paragraphs (c)(3) of this section will must be certified to the corresponding
10,000 engines in the 56–130 kW power be considered not covered by a phase-out standards. Engines certified
category (i.e., 5,000 engines) in 2012 in certificate of conformity and in violation under this paragraph (d)(2) may
compliance with the Tier 4 phase-in of § 1068.101(a)(1). generate NOX emission credits only for
standards for NOX and NMHC in Table (5) For the purposes of this part, the averaging within the same power
4 of this section, but produce 4,500 such term ‘‘phase-in’’ means relating to a category during the same model year.
For engines certified under this power categories during the phase-in of credits relative to the 4.0 g/kW-hr
paragraph (d)(2), the 2014 model year Tier 4 standards, you may split an NOX+NMHC standard.
may not extend beyond December 30, engine family into two subfamilies (for (g) Other provisions. The provisions
2014. example, one that uses credits and one of § 1039.101(d) through (h) apply with
(e) Alternate NOX standards. For that generates credits for the same respect to the standards of this section,
engines in 56–560 kW power categories pollutant). with the following exceptions and
during the phase-in of Tier 4 standards, special provisions:
(1) Identify any split engine families
you may certify engine families to the (1) NTE standards. Use the provisions
in your application for certification.
alternate NOX standards in this of § 1039.101(e)(3) to calculate and
Your engines must comply with all the
paragraph (e) instead of the phase-in apply the NTE standards, but base these
and phase-out NOX and NOX+NMHC standards and requirements applicable
to Tier 4 engines, except as noted in this calculated values on the applicable
standards described in Tables 4 through
paragraph (f). You may calculate standards in this section or the
6 of this section. Engines certified under
emission credits relative to different applicable FEL, instead of the standards
this section must be certified to an
emission standards (i.e., phase-in and in Table 1 of § 1039.101. All other
NMHC standard of 0.19 g/kW-hr. Do not
phase-out standards) for different sets of provisions of § 1039.101(e) apply under
include engine families certified under
engines within the engine family, but this paragraph (g)(1). The NTE standards
this paragraph (e) in determining
the engine family must be certified to a do not apply for certain engines and
whether you comply with the
single set of standards and FELs. To certain pollutants, as follows:
percentage phase-in requirements of
paragraphs (c) and (d)(2) of this section. calculate NOX+NMHC emission credits, (i) All engines below 37 kW for model
Except for the provisions for alternate add the NOX FEL to the NMHC phase- years before 2013.
FEL caps in § 1039.104(g), the NOX in standard for comparison with the (ii) All engines certified under Option
standards and FEL caps under this applicable NOX+NMHC phase-out #1 of Table 3 of this section. These are
paragraph (e) are as follows: standard. Any engine family certified small-volume manufacturer engines
(1) For engines in the 56–130 kW under this paragraph (f) must meet the certified to the Option #1 standards for
power category, apply the following applicable phase-in standard for NMHC. model years 2008 through 2015 under
alternate NOX standards and FEL caps: You may assign the number and § 1039.104(c), and other engines
(i) If you use the provisions of configurations of engines within the certified to the Option #1 standards for
paragraph (d)(1) of this section, your respective subfamilies any time before model years 2008 through 2012.
alternate NOX standard for any engine the due date for the final report required (iii) All engines less than or equal to
family in the 56–130 kW power category in § 1039.730. Apply the same label to 560 kW that are certified to an FEL
is 2.3 g/kW-hr for model years 2012 and each engine in the family, including the under the alternate FEL program during
2013. Engines certified to this standard NOX FEL to which it is certified. the first four years of the Tier 4
may not exceed a NOX FEL cap of 3.0 standards for the applicable power
(2) For example, a 10,000-unit engine
g/kW-hr. category, as described in § 1039.104(g).
(ii) If you use the provisions of family in the 75–130 kW power category
may be certified to meet the standards However, if you apply to meet transient
paragraph (d)(2) of this section, your emission standards for these engines
alternate NOX standard for any engine for PM, NMHC, and CO that apply to
phase-in engines, with a 0.8 g/kW-hr under § 1039.102(a)(1)(iii), you must
family in the 56–130 kW power category also meet the NTE standards in this
is 3.4 g/kW-hr for model years 2012 FEL for NOX. When compared to the
phase-out NOX+NMHC standard, this paragraph (g)(1).
through 2014. Engines below 75 kW
engine family would generate positive (iv) Gaseous pollutants for phase-out
certified to this standard may not
NOX+NMHC emission credits. When engines that you certify to the same
exceed a NOX FEL cap of 4.4 g/kW-hr;
compared to the phase-in NOX standard, numerical standards and FELs for
engines at or above 75 kW certified to
this engine family would generate gaseous pollutants to which you
this standard may not exceed a NOX
FEL cap of 3.8 g/kW-hr. negative NOX emission credits. You certified under the Tier 3 requirements
(iii) If you do not use the provisions could create a subfamily with 2,500 of 40 CFR part 89. However, the NTE
of paragraph (d) of this section, you may engines (one-quarter of the 10,000 standards for PM apply to these engines.
apply the alternate NOX standard and engines) and identify them as phase-in (2) Interim FEL caps. As described in
the appropriate FEL cap from either engines. You would count these 2,500, 1039.101(d), you may participate in the
paragraph (e)(1)(i) or (ii) of this section. with their negative NOX credits, in ABT program in subpart H of this part
(2) For engines in the 130–560 kW determining compliance with the 50- by certifying engines to FELs for PM,
power category, the alternate NOX percent phase-in requirement in NOX, or NOX+NMHC instead of the
standard is 2.0 g/kW-hr for model years paragraph (c)(1) of this section. You standards in Tables 1 through 7 of this
2011 through 2013. Engines certified to would calculate negative credits relative section for the model years shown. The
this standard may not exceed a NOX to the 0.40 g/kW-hr NOX standard for FEL caps listed in the following table
FEL cap of 2.7 g/kW-hr. these 2,500 engines. You would identify apply instead of the FEL caps
(f) Split families. For generating or the other 7,500 engines in the family as in§ 1039.101(d)(1), except as allowed by
using credits for engines in 56–560 kW phase-out engines and calculate positive § 1039.104(g):
TABLE 8 OF § 1039.102.—I NTERIM TIER 4 FEL CAPS, G/KW-HR

Maximum Phase-in Model years 1 PM NOX NOX+NMHC
engine power option
kW < 19 .......................................................... ......................................................... 2008–2014 0.80 .................... 29.5
19 ≤ kW < 37 ................................................. ......................................................... 2008–2012 0.60 .................... 9.5

37 ≤ kW < 56 ................................................. ......................................................... 32008–2012 0.40 .................... 7.5
56 ≤ kW < 130 ............................................... Phase-in .......................................... 2012–2013 0.04 0.80 ....................
56 ≤ kW < 130 ............................................... Phase-out ........................................ 2012–2013 0.04 .................... 4 6.6
TABLE 8 OF § 1039.102.—I NTERIM TIER 4 FEL CAPS, G/KW-HR—Continued

Maximum Phase-in Model years 1 PM NOX NOX+NMHC
engine power option
130 ≤ kW ≤ 560 ............................................. Phase-in .......................................... 2011–2013 0.04 0.80 ....................

130 ≤ kW ≤ 560 ............................................. Phase-out ........................................ 2011–2013 0.04 .................... 5 6.4
kW > 560 ........................................................ ......................................................... 2011–2014 0.20 6.2 ....................

1 For model years before 2015 where this table does not specify FEL caps, apply the FEL caps shown in § 1039.101.
2 For engines below 8 kW, the FEL cap is 10.5 g/kW-hr for NOX+NMHC emissions.
3 For manufacturers certifying engines to the standards of this part 1039 in 2012 under Option #2 of Table 3 of § 1039.102, the FEL caps of
§ 1039.101 apply for model year 2012 and later; see 40 CFR part 89 for provisions that apply to earlier model years.
4 For engines below 75 kW, the FEL cap is 7.5 g/kW-hr for NO +NMHC emissions.
X
5 For engines below 225 kW, the FEL cap is 6.6 g/kW-hr for NO +NMHC emissions.
X
(3) Crankcase emissions. The applicable standards in § 1039.101 or (B) For engines at or above 37 kW and
crankcase emission requirements of § 1039.102, when some of your engines below 56 kW: September 1, 2012 if you
§ 1039.115(a) do not apply to engines are certified to the specified levels choose Option #1 in Table 3 of
using charge-air compression that are earlier than otherwise required. The § 1039.102, or September 1, 2011 if you
certified to an FEL under the alternate engines that are certified early are do not choose Option #1 in Table 3 of
FEL program in § 1039.104(g) during the considered offset-generating engines. § 1039.102.
first four years of the Tier 4 standards The provisions of this paragraph (a), (C) For engines in the 56–130 kW
for the applicable power category. which describe the requirements power category: September 1, 2011.
(4) Special provisions for 37–56 kW applicable to offset-generating engines, (D) For engines in the 130–560 kW
engines. For engines at or above 37 kW apply beginning in model year 2007. power category: September 1, 2010.
and below 56 kW from model years These offset generating engines may (E) For engines above 560 kW:
2008 through 2012, you must take the generate additional allowances for September 1, 2014.
following additional steps: equipment manufacturers under the (iii) Engines you produce after
(i) State the applicable PM standard incentive program described in December 31 of the year shown in
on the emission control information § 1039.627; you may instead use these paragraph (a)(1)(ii) of this section may
label. offsets under paragraph (a)(2) of this not generate offsets.
(ii) Add information to the emission- section in some cases. (iv) You may not use ABT credits to
related installation instructions to (1) For early-compliant engines to certify offset-generating engines.
clarify the equipment manufacturer’s generate offsets for use either under this (v) Offset-generating engines must be
obligations under § 1039.104(f). paragraph (a) or under § 1039.627, you certified to the Tier 4 standards and
§ 1039.104 Are there interim provisions must meet the following general requirements under this part 1039.
that apply only for a limited time? provisions: (2) If equipment manufacturers
The provisions in this section apply (i) You may not generate offsets from decline offsets for your offset-generating
instead of other provisions in this part. engines below 19 kW. engines under § 1039.627, you may not
This section describes when these (ii) You must begin actual production generate ABT credits with these
interim provisions apply. of engines covered by the corresponding engines, but you may reduce the
(a) Incentives for early introduction. certificate by the following dates: number of engines that are required to
This paragraph (a) allows you to reduce (A) For engines at or above 19 kW and meet the standards in § 1039.101 or
the number of engines subject to the below 37 kW: September 1, 2012. 1039.102 as follows:
That are certified to the You may reduce the number of engines in
With maximum engine In later model
For every . . . applicable standards in the same power category that are required
power . . . years by . . .
. . . to meet the . . .
(i) 2 engines .............. 19 ≤ kW < 37 .................... Table 2 of § 1039.102 1 .... PM standard in Table 2 of § 1039.102 ap 3 engines.
plicable to model year 2013 or 2014 en
gines or the PM standard in Table 1 of
§ 1039.101.
(ii) 2 engines .............. 56 ≤ kW ≤ 560 .................. Table 4, 5, or 6 of Phase-out standards in Tables 4 through 6 3 engines.
§ 1039.102 for Phase- of § 1039.102.
out engines.
(iii) 2 engines ............. kW ≥ 19 ............................ Table 1 of § 1039.101 ...... Standards in Tables 2 through 7 of 3 engines.2
§ 1039.102 or standards in Table 1 of
§ 1039.101.
(iv) 1 engine .............. kW ≥ 19 ............................ Table 1 of § 1039.101 + Standards in Tables 2 through 7 of 2 engines.2
0.20 g/kW-hr NOX § 1039.102 or standards in Table 1 of
standard. § 1039.101.
1 The engine must be certified to the PM standard applicable to model year 2013 engines, and to the NO +NMHC and CO standards applica
X
ble to model year 2012 engines.
2 For engines above 560 kW, offsets from generator-set engines may be used only for generator-set engines. Offsets from engines for other
applications may be used only for other applications besides generator sets.
(3) Example: If you produce 100 category in model year 2008 that are Ä listed in § 1039.101, and you produced
engines in the 56–130 kW power certified to the 56–130 kW standards 10,000 engines in this power category inÄ
model year 2015, then only 9,850 of engines in the 130–560 kW power (6) You may include engines used to
these model year 2015 engines would category, or in model year 2014 for generate offsets under this paragraph (a)
need to comply with the standards engines above 560 kW. Show that and engines used to generate offsets
listed in § 1039.101. The 100 offset- engines meet these emission standards under § 1039.627 in the same engine
generating engines in model year 2008 by meeting all the requirements of family, subject to the provisions of
could not use or generate ABT credits. § 1039.260. You must meet the labeling § 1039.230. The engine must be certified
(4) Offset-using engines (that is, those requirements in § 1039.135, but add the to FELs, as specified in paragraph
not required to certify to the standards following statement instead of the (a)(5)(i) of this section. The FELs must
of § 1039.101 or § 1039.102 under compliance statement in be below the standard levels specified
paragraph (a)(2) of this section) are § 1039.135(c)(12): ‘‘THIS ENGINE in paragraph (a)(2) of this section and
subject to the following provisions: MEETS U.S. EPA EMISSION those specified in § 1039.627. In the
(i) If the offset is being used under STANDARDS UNDER 40 CFR reports required in § 1039.730, include
paragraph (a)(2)(i) of this section for an 1039.104(a).’’ For power categories with the following information for each
engine that would otherwise be certified a percentage phase-in, these engines model year:
to the model year 2013 or 2014 should be treated as phase-in engines (i) The total number of engines that
standards in Table 2 of § 1039.102 or the for purposes of determining compliance generate offsets under this paragraph (a).
standards in Table 1 of § 1039.101, this with phase-in requirements. (ii) The number of engines used to
engine must be certified to the standards (5) If an equipment manufacturer generate offsets under paragraph (a)(2)
and requirements of this part 1039, claims offsets from your engine for use of this section.
except that the only PM standard that under § 1039.627, the engine generating
applies is the steady-state PM standard the offset must comply with the (iii) The names of equipment
that applies for model year 2012. Such requirements of paragraph (a)(1) of this manufacturers that intend to use your
an engine may not generate ABT credits. section. You may not generate offsets for offsets under § 1039.627 and the number
(ii) If the offset is being used under use under paragraphs (a)(2) and (5) of of offsets involved for each equipment
paragraph (a)(2)(ii) of this section for an this section for these engines. You may manufacturer.
engine that would otherwise be certified generate ABT credits from these engines (b) In-use compliance limits. For
to the phase-out standards in Tables 4 as follows: purposes of determining compliance
through 6 of § 1039.102, this engine (i) To generate emission credits for after title or custody has transferred to
must be certified to the standards and NOX, NOX+NMHC, and PM, the engine the ultimate purchaser, calculate the
requirements of this part 1039, except must be certified to FELs at or below the applicable in-use compliance limits by
that the PM standard is the Tier 3 PM standards in paragraph (a)(2) of this adjusting the applicable standards or
standard that applies for this engine’s section. FELs. This applies only for engines at or
maximum power. Such an engine will (ii) Calculate credits according to above 19 kW. The NOX adjustment
be treated as a phase-out engine for § 1039.705 but use as the applicable applies only for engines with a NOX FEL
purposes of determining compliance standard the numerical value of the no higher than 2.1 g/kW-hr The PM
with percentage phase-in requirements. standard to which the engine would adjustment applies only for engines
Such an engine may not generate ABT have otherwise been subject if it had not with a PM FEL no higher than the PM
credits. been certified under this paragraph (a). standard in § 1039.101 for the
(iii) All other offset-using engines (iii) For the production volume, use appropriate power category. Add the
must meet the standards and other the number of engines certified under following adjustments to the otherwise
provisions that apply in model year this paragraph (a) for which you do not applicable standards or FELs (steady-
2011 for engines in the 19–130 kW claim offsets under paragraph (a)(2) of state, transient, and NTE) for NOX and
power categories, in model year 2010 for this section. PM:
The PM
In model years . . . If your engine’s maximum power is The NOX adjustment in g/kW-hr is . . . adjustment in
. . . g/kW-hr is
. . .
2013–2014 .............. 19 ≤ kW < 56 .................................... not allowed ...................................................................................... 0.01

2012–2016 .............. 56 ≤ kW < 130 .................................. 0.16 for operating hours ≤ 2000 ..................................................... 0.01
0.25 for operating hours 2001 to 3400 ...........................................
0.34 for operating hours > 3400 .....................................................
2011–2015 .............. 130 ≤ kW < 560 ................................ 0.16 for operating hours ≤ 2000 ..................................................... 0.01
2011–2016 .............. kW > 560 .......................................... 0.16 for operating hours ≤ 2000 ..................................................... 0.01
(c) Provisions for small-volume requirements of this part. You must (1) You may delay complying with
manufacturers. Special provisions apply notify us in writing before January 1, certain otherwise applicable Tier 4
if you are a small-volume engine 2008 if you intend to use these emission standards and requirements as
manufacturer subject to the provisions. described in the following table:
If your engine’s maximum Until model Before that model year the engine
You may delay meeting . . .
power is . . . year . . . must comply with . . .
kW < 19 .................................. The standards and requirements of this part ................... 2011
The standards and requirements in
40 CFR part 89.
19 ≤ kW < 37 .......................... The Tier 4 standards and requirements of this part that 2016 The Tier 4 standards and require
would otherwise be applicable in model year 2013. ments that apply for model year
2008.
37 ≤ kW < 56 .......................... See paragraph (c)(2) of this section for special provisions that apply for engines in this power category.
56 ≤ kW < 130 ........................ The standards and requirements of this part ................... 2015 The standards and requirements in
40 CFR part 89.
(2) To use the provisions of this for the model years when you are out of engines. We may consider other
paragraph (c) for engines at or above 37 delaying compliance with the otherwise relevant factors.
kW and below 56 kW, choose one of the applicable standards: (3) Our approval applies only for a
following: (i) Produce engines in those model single model year and may be limited to
(i) If you comply with the 0.30 g/kW years that meet all the emission specific engine configurations. We may
hr PM standard in § 1039.102 in all standards and other requirements that approve your request for the same
model years from 2008 through 2012 applied for your model year 2008 deficiency in the following model year
without using PM credits, you may engines in the same power category. if correcting the deficiency would
continue meeting that standard through (ii) Meet the labeling requirements in require unreasonable hardware or
2015. § 1039.135, but use the following software modifications and we
(ii) If you do not choose to comply compliance statement instead of the determine that you have demonstrated
with paragraph (c)(2)(i) of this section, compliance statement in § 1039.135: an acceptable level of effort toward
you may continue to comply with the ‘‘THIS ENGINE COMPLIES WITH U.S. complying.
standards and requirements in 40 CFR EPA REGULATIONS FOR [CURRENT (4) You may ask for any number of
part 89 for model years through 2012, MODEL YEAR] NONROAD deficiencies in the first three model
but you must begin complying in 2013 COMPRESSION-IGNITION ENGINES years during which NTE standards
with Tier 4 standards and requirements UNDER 40 CFR 1039.104(c).’’. apply for your engines. For the next four
specified in Table 3 of § 1039.102 for (iii) Notify the equipment model years, we may approve up to
model years 2013 and later. manufacturer that the engines you three deficiencies per engine family.
(3) After the delays indicated in produce under this section are excluded Deficiencies of the same type that apply
paragraph (c)(1) and (2) of this section, from the production volumes associated similarly to different power ratings
you must comply with the same Tier 4 with the equipment-manufacturer within a family count as one deficiency
standards and requirements as all other allowance program in § 1039.625. per family. We may condition approval
manufacturers. (6) The provisions of this paragraph of any such additional deficiencies
(4) For engines not in the 19–56 kW (c) may not be used to circumvent the during these four years on any
power category, if you delay compliance requirements of this part. additional conditions we determine to
with any standards under this paragraph (d) Deficiencies for NTE standards. be appropriate. We will not approve
(c), you must do all the following things You may ask us to accept as compliant deficiencies after the seven-year period
for the model years when you are an engine that does not fully meet specified in this paragraph (d)(4).
delaying compliance with the otherwise specific requirements under the (e) Diesel test fuels and corresponding
applicable standards: applicable NTE standards. Such labeling requirements. For diesel-fueled
(i) Produce engines that meet all the deficiencies are intended to allow for engines in 2011 and later model years,
emission standards and other minor deviations from the NTE the diesel test fuel is ultra low-sulfur
requirements under 40 CFR part 89 standards under limited conditions. We diesel fuel specified in 40 CFR part
applicable for that model year, except as expect your engines to have functioning 1065. For diesel-fueled engines in 2010
noted in this paragraph (c). emission-control hardware that allows and earlier model years, use test fuels
(ii) Meet the labeling requirements in you to comply with the NTE standards. and meet labeling requirements as
40 CFR 89.110, but use the following (1) Request our approval for specific follows:
compliance statement instead of the deficiencies in your application for (1) Use the following test fuels in
compliance statement in 40 CFR certification, or before you submit your 2010 and earlier model years:
89.110(b)(10): ‘‘THIS ENGINE application. We will not approve (i) Unless otherwise specified, the
COMPLIES WITH U.S. EPA deficiencies retroactively to cover diesel test fuel is low-sulfur diesel fuel
REGULATIONS FOR [CURRENT engines already certified. In your specified in 40 CFR part 1065.
MODEL YEAR] NONROAD request, identify the scope of each (ii) In model years 2007 through 2010,
COMPRESSION-IGNITION ENGINES deficiency and describe any auxiliary you may use ultra low-sulfur diesel fuel
UNDER 40 CFR 1039.104(c).’’. emission-control devices you will use to as the test fuel for any engine family
(iii) Notify the equipment control emissions to the lowest practical that employs sulfur-sensitive technology
manufacturer that the engines you level, considering the deficiency you are if you can demonstrate that in-use
produce under this section are excluded requesting. engines in the family will use diesel fuel
from the production volumes associated (2) We will approve a deficiency only with a sulfur concentration no greater
with the equipment-manufacturer if compliance would be infeasible or than 15 ppm.
allowance program in § 1039.625. unreasonable considering such factors (iii) You may use ultra low-sulfur
(5) For engines in the 19–56 kW as the technical feasibility of the given diesel fuel as the test fuel for engine
power category, if you delay compliance hardware and the applicable lead time families in any power category below 56
with any standards under this paragraph and production cycles—including kW, as long as none of the engines in
(c), you must do all the following things schedules related to phase-in or phase- your engine family employ sulfur-
sensitive technologies, you ensure that (1) For equipment you produce with under Option #1 of Table 3 of
ultimate purchasers of equipment using 2012 model year engines at or above 37 § 1039.102 (or certified to less stringent
these engines are informed that ultra kW and below 56 kW, determine the standards) in such equipment violates
low-sulfur diesel fuel is recommended, minimum number of these engines that the prohibitions in § 1068.101(a)(1).
and you recommend to equipment must be certified to the Option #2 (g) Alternate FEL caps. You may
manufacturers that a label be applied at standards in Table 3 of § 1039.102 as certify a limited number of engines from
the fuel inlet recommending 15 ppm follows: your U.S.-directed production volume
fuel. (i) If all the equipment you produce to the FEL caps in Table 1 of this section
(iv) For the engines described in using 2008 through 2011 model year instead of the otherwise applicable FEL
§ 1039.101(c) that are certified to the engines use engines certified to Tier 3 caps in § 1039.101(d)(1), § 1039.102(e),
0.60 g/kW-hr PM standard in Table 1 of standards under Option #2 of Table 3 of or § 1039.102(g)(2), subject to the
§ 1039.102 in the 2010 model year, you § 1039.102, then all the 2012 model year following provisions:
may test with the ultra low-sulfur fuel engines you install must be certified to (1) The provisions of this paragraph
specified in 40 CFR part 1065. the Option #2 standards of Table 3 of (g) apply during the model years shown
(2) Meet the labeling requirements of § 1039.102. in Table 1 of this section. During this
this paragraph (e)(2) (or other labeling (ii) If you produce equipment using period, the number of engines certified
requirements we approve) to identify 2008 through 2011 model year engines to the FEL caps in Table 1 of this section
the applicable test fuels specified in with some engines certified to Option must not exceed 20 percent in any
paragraph (e)(1) of this section. Provide #1 standards of Table 3 of § 1039.102 single model year in each power
instructions to equipment and some engines certified to Tier 3 category. The sum of percentages over
manufacturers to ensure that they are standards under Option #2 standards of the four-year period must not exceed a
aware of these labeling requirements. Table 3 of § 1039.102, calculate the total of 40 percent in each power
(i) For engines certified under the minimum number of 2012 model year category. If you certify an engine under
provisions of paragraph (e)(1)(i) of this engines you must install that are an alternate FEL cap in this paragraph
section, include the following statement certified to the Option #2 standards of (g) for any pollutant, count it toward the
on the emission control information Table 3 of § 1039.102 from the following allowed percentage of engines certified
label and the fuel-inlet label specified in equation: to the alternate FEL caps.
§ 1039.135: ‘‘LOW SULFUR FUEL OR Minimum number = [(T-O1-F)/(T–F)¥0.05] × (2) If your engine is not certified to
ULTRA LOW SULFUR FUEL ONLY’’. P
(ii) For engines certified under the transient emission standards under the
Where: provisions of § 1039.102(a)(1)(iii), you
provisions of paragraph (e)(1)(ii) of this T = The total number of 2008–2010 model
section, include the following statement must adjust your FEL upward by a
year engines at or above 37 kW and
on the emission control information temporary compliance adjustment factor
below 56 kW that you use in equipment
label and the fuel-inlet label specified in you produce. (TCAF) before calculating your negative
§ 1039.135: ‘‘ULTRA LOW SULFUR O1 = The number of engines from the 2008– emission credits under § 1039.705, as
FUEL ONLY’’. 2010 model years certified under Option follows:
(iii) For engines certified under the #1 of Table 3 of § 1039.102 that you use (i) The temporary compliance
in equipment you produce. adjustment factor for NOX is 1.1.
provisions of paragraph (e)(1)(iii) of this F = The number of 2008–2010 model year
section, include the following statement (ii) The temporary compliance
engines at or above 37 kW and below 56
on the emission control information kW that you use in equipment you
adjustment factor for PM is 1.5.
label specified in § 1039.135: ‘‘ULTRA produce under the flexibility provisions (iii) The adjusted FEL (FELadj) for
LOW SULFUR FUEL of § 1039.625. calculating emission credits is
RECOMMENDED’’. P = The total number of 2012 model year determined from the steady-state FEL
(3) For model years 2010 and earlier, engines at or above 37 kW and below 56 (FELss) using the following equation:
we will use the test fuel that you use kW that you use in equipment you
FELadj = (FELss) × (TCAF)
under paragraph (e)(1) of this section, produce.
subject to the conditions of paragraph (2) As needed for the calculation (iv) The unadjusted FEL (FELss)
(e)(1) of this section. required by this paragraph (f), keep applies for all purposes other than
(f) Requirements for equipment records of all equipment you produce credit calculation.
manufacturers. If you produce using 2008–2012 model year engines at (3) These alternate FEL caps may not
equipment with engines certified to Tier or above 37 kW and below 56 kW. If you be used for phase-in engines.
3 standards under Option #2 of Table 3 fail to keep these records, you may not (4) Do not apply TCAFs to gaseous
of § 1039.102 during model years from use any 2012 model year engines emissions for phase-out engines that
2008 through 2011, then a minimum certified to Option #1 standards in your you certify to the same numerical
number of pieces of equipment you equipment. standards (and FELs if the engines are
produce using 2012 model year engines (3) If you fail to comply with the certified using ABT) for gaseous
must have engines certified to the provisions of this paragraph (f), then pollutants as you certified under the
Option #2 standards, as follows: using 2012 model year engines certified Tier 3 requirements of 40 CFR part 89.
TABLE 1 OF § 1039.104.—A LTERNATE FEL CAPS

Model years Model years
PM FEL cap, for the alter NOX FEL cap, for the alter
Maximum engine power g/kW-hr nate PM FEL g/kW-hr nate NOX FEL
cap cap
19 ≤ kW < 56 ................................................................................................... 0.30 1 2012–2015 ........................ ........................

56 ≤ kW < 130 2 ............................................................................................... 0.30 3 2012–2015 3.8 3 2014–2015
130 ≤ kW ≤ 560 ............................................................................................... 0.20 2011–2014 3.8 2014

TABLE 1 OF § 1039.104.—A LTERNATE FEL CAPS—Continued

Model years Model years
PM FEL cap, for the alter NOX FEL cap, for the alter
Maximum engine power g/kW-hr nate PM FEL g/kW-hr nate NOX FEL
cap cap
kW > 560 4 ....................................................................................................... 0.10 2015–2018 3.5 2015–2018

1 Formanufacturers certifying engines under Option #1 of Table 3 of § 1039.102, these alternate FEL caps apply for model years from 2013
through 2016.
2 For engines below 75 kW, the FEL caps are 0.40 g/kW-hr for PM emissions and 4.4 g/kW-hr for NO emissions.
X
3 For engines certified under the provisions of § 1039.102(d)(2) or (e)(1)(ii), the alternate NO FEL cap in the table applies only for the 2015
X
model year.
4 For engines above 560 kW, the provision for alternate NO FEL caps is limited to generator-set engines. For example, if you produce 1,000
X
generator-set engines above 560 kW in 2015, up to 200 of them may be certified to the alternate NOX FEL caps.
§ 1039.105 What smoke standards must (a) Crankcase emissions. Crankcase defeat device is an auxiliary emission-
my engines meet? emissions may not be discharged control device that reduces the
(a) The smoke standards in this directly into the ambient atmosphere effectiveness of emission controls under
section apply to all engines subject to from any engine, except as follows: conditions that the engine may
emission standards under this part, (1) Engines may discharge crankcase reasonably be expected to encounter
except for the following engines: emissions to the ambient atmosphere if during normal operation and use. This
(1) Single-cylinder engines. the emissions are added to the exhaust does not apply to auxiliary-emission
(2) Constant-speed engines. emissions (either physically or control devices you identify in your
(3) Engines certified to a PM emission mathematically) during all emission certification application if any of the
standard or FEL of 0.07 g/kW-hr or testing. following is true:
lower. (2) If you take advantage of this (1) The conditions of concern were
(b) Measure smoke as specified in exception, you must do the following substantially included in the applicable
§ 1039.501(c). Smoke from your engines things: test procedures described in subpart F
may not exceed the following standards: (i) Manufacture the engines so that all of this part.
(1) 20 percent during the acceleration crankcase emissions can be routed into
(2) You show your design is necessary
mode. the applicable sampling systems
(2) 15 percent during the lugging to prevent engine (or equipment)
specified in 40 CFR part 1065.
mode. (ii) Account for deterioration in damage or accidents.
(3) 50 percent during the peaks in crankcase emissions when determining (3) The reduced effectiveness applies
either the acceleration or lugging modes. exhaust deterioration factors. only to starting the engine.
(3) For purposes of this paragraph (a), § 1039.120 What emission-related warranty
§ 1039.107 What evaporative emission crankcase emissions that are routed to
standards and requirements apply? requirements apply to me?
the exhaust upstream of exhaust
There are no evaporative emission (a) General requirements. You must
aftertreatment during all operation are
standards for diesel-fueled engines, or warrant to the ultimate purchaser and
not considered to be discharged directly
engines using other nonvolatile or each subsequent purchaser that the new
into the ambient atmosphere.
nonliquid fuels (for example, natural (b)–(d) [Reserved] nonroad engine, including all parts of
gas). If your engine uses a volatile liquid (e) Adjustable parameters. Engines its emission-control system, meets two
fuel, such as methanol, you must meet that have adjustable parameters must conditions:
the evaporative emission requirements meet all the requirements of this part for (1) It is designed, built, and equipped
of 40 CFR part 1048 that apply to spark- any adjustment in the physically so it conforms at the time of sale to the
ignition engines, as follows: adjustable range. An operating ultimate purchaser with the
(a) Follow the steps in 40 CFR parameter is not considered adjustable if requirements of this part.
1048.245 to show that you meet the you permanently seal it or if it is not (2) It is free from defects in materials
requirements of 40 CFR 1048.105. normally accessible using ordinary and workmanship that may keep it from
(b) Do the following things in your tools. We may require that you set meeting these requirements.
application for certification: adjustable parameters to any (b) Warranty period. Your emission-
(1) Describe how your engines control specification within the adjustable range related warranty must be valid for at
evaporative emissions. during any testing, including least as long as the minimum warranty
(2) Present test data to show that certification testing, selective periods listed in this paragraph (b) in
equipment using your engines meets the enforcement auditing, or in-use testing. hours of operation and years, whichever
evaporative emission standards we (f) Prohibited controls. You may not comes first. You may offer an emission-
specify in this section if you do not use design your engines with emission- related warranty more generous than we
design-based certification under 40 CFR control devices, systems, or elements of require. The emission-related warranty
1048.245. Show these figures before and design that cause or contribute to an for the engine may not be shorter than
after applying deterioration factors, unreasonable risk to public health, any published warranty you offer
where applicable. welfare, or safety while operating. For without charge for the engine. Similarly,
§ 1039.110 [Reserved] example, this would apply if the engine the emission-related warranty for any
emits a noxious or toxic substance it component may not be shorter than any
§ 1039.115 What other requirements must would otherwise not emit that published warranty you offer without
my engines meet? contributes to such an unreasonable charge for that component. If you
Engines subject to this part must meet risk. provide an extended warranty to
the following requirements, except as (g) Defeat devices. You may not equip individual owners for any components
noted elsewhere in this part: your engines with a defeat device. A covered in paragraph
(c) of this section for an additional has no hour meter, we base the warranty into service. The minimum warranty Ä
charge, your emission-related warranty periods in this paragraph (b) only on the periods are shown in the following Ä
must cover those components for those engine’s age (in years). The warranty table:Ä
owners to the same degree. If an engine period begins when the engine is placed Ä
If your engine is certified as And its maximum power is And its rated speed is . . . Then its warranty period is . . .
. . . . . .
Variable speed or constant kW < 19 .................................. Any speed .............................. 1,500 hours or two years, whichever comes
speed. first.
Constant speed ........................ 19 ≤ kW < 37 ......................... 3,000 rpm or higher ................ 1,500 hours or two years, whichever comes
first.
Constant speed ........................ 19 ≤ kW < 37 ......................... Less than 3,000 rpm .............. 3,000 hours or five years, whichever comes
first.
Variable speed ......................... 19 ≤ kW < 37 ......................... Any speed .............................. 3,000 hours or five years, whichever comes
first.
Variable speed or constant kW ≥ 37 .................................. Any speed .............................. 3,000 hours or five years, whichever comes
speed. first.
(c) Components covered. The done at the recommended intervals on (i) For EGR-related filters and coolers,
emission-related warranty covers all in-use engines. We will accept PCV valves, and fuel injector tips
components whose failure would scheduled maintenance as reasonably (cleaning only), the minimum interval is
increase an engine’s emissions of any likely to occur if you satisfy any of the 1,500 hours.
pollutant. This includes components following conditions: (ii) For the following components,
listed in 40 CFR part 1068, Appendix I, (i) You present data showing that, if including associated sensors and
and components from any other system a lack of maintenance increases actuators, the minimum interval is 4500
you develop to control emissions. The emissions, it also unacceptably degrades hours: fuel injectors, turbochargers,
emission-related warranty covers these the engine’s performance. catalytic converters, electronic control
components even if another company (ii) You present survey data showing units, particulate traps, trap oxidizers,
produces the component. Your that at least 80 percent of engines in the components related to particulate traps
emission-related warranty does not field get the maintenance you specify at and trap oxidizers, EGR systems
cover components whose failure would the recommended intervals. (including related components, but
not increase an engine’s emissions of (iii) You provide the maintenance free excluding filters and coolers), and other
any pollutant. of charge and clearly say so in add-on components. For particulate
(d) Limited applicability. You may maintenance instructions for the traps, trap oxidizers, and components
deny warranty claims under this section customer. related to either of these, maintenance is
if the operator caused the problem (iv) You otherwise show us that the limited to cleaning and repair only.
through improper maintenance or use, maintenance is reasonably likely to be (4) If your engine family has an
as described in 40 CFR 1068.115. done at the recommended intervals. alternate useful life under § 1039.101(g)
(e) Owners manual. Describe in the (2) For engines below 130 kW, you that is shorter than the period specified
owners manual the emission-related may not schedule critical emission- in paragraph (a)(2) or (a)(3) of this
warranty provisions from this section related maintenance more frequently section, you may not schedule critical
that apply to the engine. than the following minimum intervals, emission-related maintenance more
except as specified in paragraphs (a)(4), frequently than the alternate useful life,
§ 1039.125 What maintenance instructions (b), and (c) of this section: except as specified in paragraph (c) of
must I give to buyers? (i) For EGR-related filters and coolers, this section.
Give the ultimate purchaser of each PCV valves, and fuel injector tips (b) Recommended additional
new nonroad engine written (cleaning only), the minimum interval is maintenance. You may recommend any
instructions for properly maintaining 1,500 hours. additional amount of maintenance on
and using the engine, including the (ii) For the following components, the components listed in paragraph (a)
emission-control system. The including associated sensors and of this section, as long as you state
maintenance instructions also apply to actuators, the minimum interval is 3000 clearly that these maintenance steps are
service accumulation on your emission- hours: fuel injectors, turbochargers, not necessary to keep the emission-
data engines, as described in § 1039.245 catalytic converters, electronic control related warranty valid. If operators do
and in 40 CFR part 1065. units, particulate traps, trap oxidizers, the maintenance specified in paragraph
(a) Critical emission-related components related to particulate traps (a) of this section, but not the
maintenance. Critical emission-related and trap oxidizers, EGR systems recommended additional maintenance,
maintenance includes any adjustment, (including related components, but this does not allow you to disqualify
cleaning, repair, or replacement of excluding filters and coolers), and other those engines from in-use testing or
critical emission-related components. add-on components. For particulate deny a warranty claim. Do not take
This may also include additional traps, trap oxidizers, and components these maintenance steps during service
emission-related maintenance that you related to either of these, maintenance is accumulation on your emission-data
determine is critical if we approve it in limited to cleaning and repair only. engines.
advance. You may schedule critical (3) For engines at or above 130 kW, (c) Special maintenance. You may
emission-related maintenance on these you may not schedule critical emission- specify more frequent maintenance to
components if you meet the following related maintenance more frequently address problems related to special
conditions: than the following minimum intervals, situations, such as atypical engine
(1) You demonstrate that the except as specified in paragraphs (a)(4), operation. You must clearly state that
maintenance is reasonably likely to be (b), and (c) of this section: this additional maintenance is
associated with the special situation you maintenance if it meets all the following equipment, as described in 40 CFR
are addressing. criteria: 1068.105.’’.
(d) Noncritical emission-related (1) Each affected component was not (8) Describe equipment-labeling
maintenance. You may schedule any in general use on similar engines before requirements consistent with
amount of emission-related inspection the applicable dates shown in paragraph § 1039.135. State whether you are
or maintenance that is not covered by (6) of the definition of new nonroad providing the label for the fuel inlet or
paragraph (a) of this section, as long as engine in § 1039.801. the equipment manufacturer must
you state in the owners manual that (2) The primary function of each provide the label.
these steps are not necessary to keep the affected component is to reduce (c) You do not need installation
emission-related warranty valid. If emissions. instructions for engines you install in
operators fail to do this maintenance, (3) The cost of the scheduled your own equipment.
this does not allow you to disqualify maintenance is more than 2 percent of (d) Provide instructions in writing or
those engines from in-use testing or the price of the engine. in an equivalent format. For example,
deny a warranty claim. Do not take (4) Failure to perform the you may post instructions on a publicly
these inspection or maintenance steps maintenance would not cause clear available website for downloading or
during service accumulation on your problems that would significantly printing. If you do not provide the
emission-data engines. degrade the engine’s performance. instructions in writing, explain in your
(e) Maintenance that is not emission- (h) Owners manual. Explain the application for certification how you
related. For maintenance unrelated to owner’s responsibility for proper will ensure that each installer is
emission controls, you may schedule maintenance in the owners manual. informed of the installation
any amount of inspection or requirements.
maintenance. You may also take these § 1039.130 What installation instructions
must I give to equipment manufacturers? § 1039.135 How must I label and identify
inspection or maintenance steps during the engines I produce?
service accumulation on your emission- (a) If you sell an engine for someone
data engines, as long as they are else to install in a piece of nonroad (a) Assign each engine a unique
reasonable and technologically equipment, give the engine installer identification number and permanently
necessary. This might include adding instructions for installing it consistent affix, engrave, or stamp it on the engine
engine oil, changing air, fuel, or oil with the requirements of this part. in a legible way.
Include all information necessary to (b) At the time of manufacture, affix
filters, servicing engine-cooling systems,
ensure that an engine will be installed a permanent and legible label
and adjusting idle speed, governor,
in its certified configuration. identifying each engine. The label must
engine bolt torque, valve lash, or
(b) Make sure these instructions have be—
injector lash. You may perform this (1) Attached in one piece so it is not
nonemission-related maintenance on the following information:
(1) Include the heading: ‘‘Emission- removable without being destroyed or
emission-data engines at the least
related installation instructions’’. defaced. However, you may use two-
frequent intervals that you recommend
(2) State: ‘‘Failing to follow these piece labels for engines below 19 kW if
to the ultimate purchaser (but not the
instructions when installing a certified there is not enough space on the engine
intervals recommended for severe
engine in a piece of nonroad equipment to apply a one-piece label.
service). (2) Secured to a part of the engine
(f) Source of parts and repairs. State violates federal law (40 CFR
1068.105(b)), subject to fines or other needed for normal operation and not
clearly on the first page of your written
penalties as described in the Clean Air normally requiring replacement.
maintenance instructions that a repair (3) Durable and readable for the
shop or person of the owner’s choosing Act.’’.
engine’s entire life.
may maintain, replace, or repair (3) Describe the instructions needed (4) Written in English.
emission-control devices and systems. to properly install the exhaust system (c) The label must—
Your instructions may not require and any other components consistent (1) Include the heading ‘‘EMISSION
components or service identified by with the requirements of § 1039.205(u). CONTROL INFORMATION’’.
brand, trade, or corporate name. Also, (4) [Reserved] (2) Include your full corporate name
do not directly or indirectly condition (5) Describe any limits on the range of and trademark. You may identify
your warranty on a requirement that the applications needed to ensure that the another company and use its trademark
equipment be serviced by your engine operates consistently with your instead of yours if you comply with the
franchised dealers or any other service application for certification. For provisions of § 1039.640.
establishments with which you have a example, if your engines are certified (3) Include EPA’s standardized
commercial relationship. You may only for constant-speed operation, tell designation for the engine family (and
disregard the requirements in this equipment manufacturers not to install subfamily, where applicable).
paragraph (f) if you do one of two the engines in variable-speed (4) State the power category or
things: applications. subcategory from § 1039.101 or
(1) Provide a component or service (6) Describe any other instructions to § 1039.102 that determines the
without charge under the purchase make sure the installed engine will applicable emission standards for the
agreement. operate according to design engine family.
(2) Get us to waive this prohibition in specifications in your application for (5) State the engine’s displacement (in
the public’s interest by convincing us certification. This may include, for liters); however, you may omit this from
the engine will work properly only with example, instructions for installing the label if all the engines in the engine
the identified component or service. aftertreatment devices when installing family have the same per-cylinder
(g) Payment for scheduled the engines. displacement and total displacement.
maintenance. Owners are responsible (7) State: ‘‘If you install the engine in (6) State the date of manufacture
for properly maintaining their engines. a way that makes the engine’s emission [MONTH and YEAR]. You may omit
This generally includes paying for control information label hard to read this from the label if you keep a record
scheduled maintenance. However, during normal engine maintenance, you of the engine-manufacture dates and
manufacturers must pay for scheduled must place a duplicate label on the provide it to us upon request.
(7) State the FELs to which the (f) You may ask us to approve Subpart C—Certifying Engine Families
engines are certified if certification modified labeling requirements in this
depends on the ABT provisions of part 1039 if you show that it is § 1039.201 What are the general
subpart H of this part. requirements for obtaining a certificate of
necessary or appropriate. We will conformity?
(8) Identify the emission-control approve your request if your alternate
system. Use terms and abbreviations (a) You must send us a separate
label is consistent with the requirements
consistent with SAE J1930 (incorporated application for a certificate of
of this part. conformity for each engine family. A
by reference in § 1039.810). You may
(g) If you obscure the engine label certificate of conformity is valid from
omit this information from the label if
there is not enough room for it and you while installing the engine in the the indicated effective date until
put it in the owners manual instead. equipment, you must place a duplicate December 31 of the model year for
(9) For diesel-fueled engines, unless label on the equipment. If others install which it is issued.
otherwise specified in § 1039.104(e)(2), your engine in their equipment in a way (b) The application must contain all
state: ‘‘ULTRA LOW SULFUR FUEL that obscures the engine label, we the information required by this part
ONLY’. require them to add a duplicate label on and must not include false or
(10) Identify any additional the equipment (see 40 CFR 1068.105); in incomplete statements or information
requirements for fuel and lubricants that that case, give them the number of (see § 1039.255).
do not involve fuel-sulfur levels. You duplicate labels they request and keep (c) We may ask you to include less
may omit this information from the the following records for at least five information than we specify in this
label if there is not enough room for it years: subpart, as long as you maintain all the
and you put it in the owners manual information required by § 1039.250.
(1) Written documentation of the (d) You must use good engineering
instead. request from the equipment judgment for all decisions related to
(11) State the useful life for your manufacturer. your application (see 40 CFR 1068.5).
engine family if we approve a shortened
(2) The number of duplicate labels (e) An authorized representative of
useful life under § 1039.101(g)(2).
you send and the date you sent them. your company must approve and sign
(12) State: ‘‘THIS ENGINE COMPLIES
the application.
WITH U.S. EPA REGULATIONS FOR § 1039.140 What is my engine’s maximum (f) See § 1039.255 for provisions
[MODEL YEAR] NONROAD DIESEL engine power? describing how we will process your
ENGINES.’’.
(a) An engine configuration’s application.
(13) For engines above 560 kW, (g) We may require you to deliver
include the following things: maximum engine power is the
maximum brake power point on the your test engines to a facility we
(i) For engines certified to the designate for our testing (see
emission standards for generator-set nominal power curve for the engine
§ 1039.235(c)).
engines, add the phrase ‘‘FOR configuration, as defined in this section.
GENERATOR SETS AND OTHER Round the power value to the nearest § 1039.205 What must I include in my
APPLICATIONS’’. whole kilowatt. application?
(ii) For all other engines, add the (b) The nominal power curve of an This section specifies the information
phrase ‘‘NOT FOR USE IN A engine configuration is the relationship that must be in your application, unless
GENERATOR SET’’. between maximum available engine we ask you to include less information
(14) If your engines are certified only brake power and engine speed for an under § 1039.201(c). We may require
for constant-speed operation, state ‘‘USE you to provide additional information to
engine, using the mapping procedures
IN CONSTANT-SPEED APPLICATIONS evaluate your application.
of 40 CFR part 1065, based on the
ONLY’’. (a) Describe the engine family’s
manufacturer’s design and production
(d) You may add information to the specifications and other basic
emission control information label to specifications for the engine. This
parameters of the engine’s design and
identify other emission standards that information may also be expressed by a emission controls. List the fuel type on
the engine meets or does not meet (such torque curve that relates maximum which your engines are designed to
as European standards). You may also available engine torque with engine operate (for example, ultra low-sulfur
add other information to ensure that the speed. diesel fuel). List each distinguishable
engine will be properly maintained and (c) The nominal power curve must be engine configuration in the engine
used. within the range of the actual power family. For each engine configuration,
(e) Except as specified in curves of production engines list the maximum engine power and the
§ 1039.104(e)(2), create a separate label considering normal production range of values for maximum engine
with the statement: ‘‘ULTRA LOW variability. If after production begins it power resulting from production
SULFUR FUEL ONLY’’. Permanently is determined that your nominal power tolerances, as described in § 1039.140.
attach this label to the equipment near curve does not represent production (b) Explain how the emission-control
the fuel inlet or, if you do not engines, we may require you to amend system operates. Describe in detail all
manufacture the equipment, take one of your application for certification under system components for controlling
the following steps to ensure that the § 1039.225. exhaust emissions, including all
equipment will be properly labeled: auxiliary-emission control devices
(1) Provide the label to the equipment (d) Throughout this part, references to (AECDs) and all fuel-system
manufacturer and include the a specific power value or a range of components you will install on any
appropriate information in the power values for an engine are based on production or test engine. Identify the
emission-related installation maximum engine power. For example, part number of each component you
instructions. the group of engines with maximum describe. For this paragraph (b), treat as
(2) Confirm that the equipment engine power above 560 kW may be separate AECDs any devices that
manufacturers install their own referred to as engines above 560 kW. modulate or activate differently from
complying labels. each other. Include all the following:
(1) Give a general overview of the how the AECD calculates the estimated Present emission data to show that you
engine, the emission-control strategies, value, if applicable. meet any applicable smoke standards
and all AECDs. (vi) Describe how you calibrate the we specify in § 1039.105. If we specify
(2) Describe each AECD’s general AECD modulation to activate only more than one grade of any fuel type
purpose and function. during conditions related to the stated (for example, high-sulfur and low-sulfur
(3) Identify the parameters that each need to protect components and only as diesel fuel), you need to submit test data
AECD senses (including measuring, needed to sufficiently protect those only for one grade, unless the
estimating, calculating, or empirically components in a way that minimizes the regulations of this part specify
deriving the values). Include emission impact. otherwise for your engine. Note that
equipment-based parameters and state (c) [Reserved] § 1039.235 allows you to submit an
whether you simulate them during (d) Describe the engines you selected application in certain cases without new
testing with the applicable procedures. for testing and the reasons for selecting emission data.
(4) Describe the purpose for sensing them. (p) State that all the engines in the
each parameter. (e) Describe the test equipment and engine family comply with the not-to-
(5) Identify the location of each sensor procedures that you used, including any exceed emission standards we specify in
the AECD uses. special or alternate test procedures you subpart B of this part for all normal
(6) Identify the threshold values for used (see § 1039.501). operation and use when tested as
the sensed parameters that activate the (f) Describe how you operated the specified in § 1039.515. Describe any
AECD. emission-data engine before testing, relevant testing, engineering analysis, or
(7) Describe the parameters that the including the duty cycle and the other information in sufficient detail to
AECD modulates (controls) in response number of engine operating hours used support your statement.
to any sensed parameters, including the to stabilize emission levels. Explain (q) For engines above 560 kW, include
range of modulation for each parameter, why you selected the method of service information showing how your emission
the relationship between the sensed accumulation. Describe any scheduled controls will function during normal in-
parameters and the controlled maintenance you did. use transient operation. For example,
parameters and how the modulation (g) List the specifications of the test this might include the following:
achieves the AECD’s stated purpose. fuel to show that it falls within the (1) Emission data from transient
Use graphs and tables, as necessary. required ranges we specify in 40 CFR testing of engines using measurement
(8) Describe each AECD’s specific part 1065. systems designed for measuring in-use
calibration details. This may be in the (h) Identify the engine family’s useful emissions.
form of data tables, graphical life. (2) Comparison of the engine design
representations, or some other (i) Include the maintenance for controlling transient emissions with
description. instructions you will give to the that from engines for which you have
(9) Describe the hierarchy among the ultimate purchaser of each new nonroad emission data over the transient duty
AECDs when multiple AECDs sense or engine (see § 1039.125). cycle for certification.
modulate the same parameter. Describe (j) Include the emission-related (3) Detailed descriptions of control
whether the strategies interact in a installation instructions you will algorithms and other design parameters
comparative or additive manner and provide if someone else installs your for controlling transient emissions.
identify which AECD takes precedence engines in a piece of nonroad (r) Report all test results, including
in responding, if applicable. equipment (see § 1039.130). those from invalid tests or from any
(10) Explain the extent to which the (k) Describe your emission control other tests, whether or not they were
AECD is included in the applicable test information label (see § 1039.135). conducted according to the test
procedures specified in subpart F of this (l) Identify the emission standards or procedures of subpart F of this part. If
part. FELs to which you are certifying you measure CO2, report those emission
(11) Do the following additional engines in the engine family. Identify levels. We may ask you to send other
things for AECDs designed to protect the ambient operating regions that will information to confirm that your tests
engines or equipment: apply for NTE testing under were valid under the requirements of
(i) Identify the engine and/or § 1039.101(e)(4). this part and 40 CFR part 1065.
equipment design limits that make (m) Identify the engine family’s (s) Describe all adjustable operating
protection necessary and describe any deterioration factors and describe how parameters (see § 1039.115(e)),
damage that would occur without the you developed them (see § 1039.245). including production tolerances.
AECD. Present any emission test data you used Include the following in your
(ii) Describe how each sensed for this. description of each parameter:
parameter relates to the protected (n) State that you operated your (1) The nominal or recommended
components’ design limits or those emission-data engines as described in setting.
operating conditions that cause the need the application (including the test (2) The intended physically adjustable
for protection. procedures, test parameters, and test range.
(iii) Describe the relationship between fuels) to show you meet the (3) The limits or stops used to
the design limits/parameters being requirements of this part. establish adjustable ranges.
protected and the parameters sensed or (o) Present emission data for (4) Information showing why the
calculated as surrogates for those design hydrocarbons (such as NMHC or THCE, limits, stops, or other means of
limits/parameters, if applicable. as applicable), NOX, PM, and CO on an inhibiting adjustment are effective in
(iv) Describe how the modulation by emission-data engine to show your preventing adjustment of parameters on
the AECD prevents engines and/or engines meet the applicable duty-cycle in-use engines to settings outside your
equipment from exceeding design emission standards we specify in intended physically adjustable ranges.
limits. § 1039.101. Show emission data figures (t) Provide the information to read,
(v) Explain why it is necessary to before and after applying adjustment record, and interpret all the information
estimate any parameters instead of factors for regeneration and broadcast by an engine’s onboard
measuring them directly and describe deterioration factors for each engine. computers and electronic control units.
State that, upon request, you will give final review and approval. If you request You must amend your application if any
us any hardware, software, or tools we preliminary approval related to the changes occur with respect to any
would need to do this. If you broadcast upcoming model year or the model year information included in your
a surrogate parameter for torque values, after that, we will make best-efforts to application.
you must provide us what we need to make the appropriate determinations as (a) You must amend your application
convert these into torque units. You soon as practicable. We will generally before you take either of the following
may reference any appropriate publicly not provide preliminary approval actions:
released standards that define related to a future model year more than (1) Add an engine (that is, an
conventions for these messages and two years ahead of time. additional engine configuration) to an
parameters. Format your information engine family. In this case, the engine
consistent with publicly released § 1039.220 How do I amend the added must be consistent with other
maintenance instructions in my engines in the engine family with
standards. application?
(u) Confirm that your emission-related respect to the criteria listed in
installation instructions specify how to You may amend your emission- § 1039.230.
ensure that sampling of exhaust related maintenance instructions after (2) Change an engine already included
emissions will be possible after engines you submit your application for in an engine family in a way that may
are installed in equipment and placed in certification, as long as the amended affect emissions, or change any of the
service. If this cannot be done by simply instructions remain consistent with the components you described in your
adding a 20-centimeter extension to the provisions of § 1039.125. You must send application for certification. This
exhaust pipe, show how to sample the Designated Compliance Officer a includes production and design changes
exhaust emissions in a way that request to amend your application for that may affect emissions any time
prevents diluting the exhaust sample certification for an engine family if you during the engine’s lifetime.
with ambient air. want to change the emission-related (b) To amend your application for
(v) State whether your certification is maintenance instructions in a way that certification, send the Designated
limited for certain engines. If this is the could affect emissions. In your request, Compliance Officer the following
case, describe how you will prevent use describe the proposed changes to the information:
of these engines in applications for maintenance instructions. We will (1) Describe in detail the addition or
which they are not certified. This disapprove your request if we determine change in the engine model or
applies for engines such as the that the amended instructions are configuration you intend to make.
following: inconsistent with maintenance you (2) Include engineering evaluations or
(1) Constant-speed engines. performed on emission-data engines. data showing that the amended engine
(2) Engines used for transportation (a) If you are decreasing the specified family complies with all applicable
refrigeration units that you certify under maintenance, you may distribute the requirements. You may do this by
the provisions of § 1039.645. new maintenance instructions to your showing that the original emission-data
(3) Hand-startable engines certified customers 30 days after we receive your engine is still appropriate with respect
under the provisions of § 1039.101(c). request, unless we disapprove your to showing compliance of the amended
(4) Engines above 560 kW that are not request. We may approve a shorter time family with all applicable requirements.
certified to emission standards for or waive this requirement. (3) If the original emission-data
generator-set engines. (b) If your requested change would engine for the engine family is not
(w) Unconditionally certify that all not decrease the specified maintenance, appropriate to show compliance for the
the engines in the engine family comply you may distribute the new new or modified nonroad engine,
with the requirements of this part, other maintenance instructions anytime after include new test data showing that the
referenced parts of the CFR, and the you send your request. For example, new or modified nonroad engine meets
Clean Air Act. this paragraph (b) would cover adding the requirements of this part.
(x) Include estimates of U.S.-directed instructions to increase the frequency of (c) We may ask for more test data or
production volumes. a maintenance step for engines in engineering evaluations. You must give
(y) Include the information required severe-duty applications. us these within 30 days after we request
by other subparts of this part. For (c) You need not request approval if them.
example, include the information you are making only minor corrections (d) For engine families already
required by § 1039.725 if you participate (such as correcting typographical covered by a certificate of conformity,
in the ABT program. mistakes), clarifying your maintenance we will determine whether the existing
(z) Include other applicable instructions, or changing instructions certificate of conformity covers your
information, such as information for maintenance unrelated to emission new or modified nonroad engine. You
specified in this part or 40 CFR part control. may ask for a hearing if we deny your
1068 related to requests for exemptions. request (see § 1039.820).
§ 1039.225 How do I amend my application (e) For engine families already
§ 1039.210 May I get preliminary approval for certification to include new or modified covered by a certificate of conformity,
before I complete my application? engines? you may start producing the new or
If you send us information before you Before we issue you a certificate of modified nonroad engine anytime after
finish the application, we will review it conformity, you may amend your you send us your amended application,
and make any appropriate application to include new or modified before we make a decision under
determinations, especially for questions engine configurations, subject to the paragraph (d) of this section. However,
related to engine family definitions, provisions of this section. After we have if we determine that the affected engines
auxiliary emission-control devices, issued your certificate of conformity, do not meet applicable requirements,
deterioration factors, testing for service you may send us an amended we will notify you to cease production
accumulation, maintenance, and NTE application requesting that we include of the engines and may require you to
deficiencies and carve-outs. Decisions new or modified engine configurations recall the engines at no expense to the
made under this section are considered within the scope of the certificate, owner. Choosing to produce engines
to be preliminary approval, subject to subject to the provisions of this section. under this paragraph (e) is deemed to be
consent to recall all engines that we standards. See § 1039.240, § 1039.245, appropriate emission-data engine under
determine do not meet applicable and 40 CFR part 1065, subpart E, paragraph (b) of this section.
emission standards or other regarding service accumulation before (3) The data show that the emission-
requirements and to remedy the emission testing. data engine would meet all the
nonconformity at no expense to the (a) Test your emission-data engines requirements that apply to the engine
owner. If you do not provide using the procedures and equipment family covered by the application for
information required under paragraph specified in subpart F of this part. certification.
(c) of this section within 30 days, you (b) Select an emission-data engine (e) We may require you to test a
must stop producing the new or from each engine family for testing. second engine of the same or different
modified nonroad engines. Select the engine configuration with the configuration in addition to the engine
highest volume of fuel injected per tested under paragraph (b) of this
§ 1039.230 How do I select engine cylinder per combustion cycle at the section.
families? point of maximum torque—unless good (f) If you use an alternate test
(a) Divide your product line into engineering judgment indicates that a procedure under 40 CFR 1065.10 and
families of engines that are expected to different engine configuration is more later testing shows that such testing
have similar emission characteristics likely to exceed (or have emissions does not produce results that are
throughout the useful life. Your engine nearer to) an applicable emission equivalent to the procedures specified
family is limited to a single model year. standard or FEL. If two or more engines in subpart F of this part, we may reject
(b) Group engines in the same engine have the same fueling rate at maximum data you generated using the alternate
family if they are the same in all the torque, select the one with the highest procedure.
following aspects: fueling rate at rated speed. In making
(1) The combustion cycle and fuel. § 1039.240 How do I demonstrate that my
this selection, consider all factors
(2) The cooling system (water-cooled engine family complies with exhaust
expected to affect emission-control emission standards?
vs. air-cooled). performance and compliance with the
(3) Method of air aspiration. (a) For purposes of certification, your
standards, including emission levels of
(4) Method of exhaust aftertreatment engine family is considered in
all exhaust constituents, especially NOX
(for example, catalytic converter or compliance with the applicable
and PM.
particulate trap). (c) We may measure emissions from numerical emission standards in
(5) Combustion chamber design. any of your test engines or other engines § 1039.101(a) and (b) or in § 1039.102(a)
(6) Bore and stroke. from the engine family, as follows: and (b) if all emission-data engines
(7) Number of cylinders (for engines (1) We may decide to do the testing representing that family have test results
with aftertreatment devices only). at your plant or any other facility. If we showing deteriorated emission levels at
(8) Cylinder arrangement (for engines do this, you must deliver the test engine or below these standards. (Note: if you
with aftertreatment devices only). to a test facility we designate. The test participate in the ABT program in
(9) Method of control for engine engine you provide must include subpart H of this part, your FELs are
operation other than governing (i.e., appropriate manifolds, aftertreatment considered to be the applicable
mechanical or electronic). devices, electronic control units, and emission standards with which you
(10) Power category. other emission-related components not must comply.)
(11) Numerical level of the emission normally attached directly to the engine (b) Your engine family is deemed not
standards that apply to the engine. block. If we do the testing at your plant, to comply if any emission-data engine
(c) You may subdivide a group of you must schedule it as soon as possible representing that family has test results
engines that is identical under and make available the instruments, showing a deteriorated emission level
paragraph (b) of this section into personnel, and equipment we need. above an applicable FEL or emission
different engine families if you show the (2) If we measure emissions on one of standard from § 1039.101 for any
expected emission characteristics are your test engines, the results of that pollutant.
different during the useful life. testing become the official emission (c) To compare emission levels from
(d) You may group engines that are results for the engine. Unless we later the emission-data engine with the
not identical with respect to the things invalidate these data, we may decide applicable emission standards, apply
listed in paragraph (b) of this section in not to consider your data in determining deterioration factors to the measured
the same engine family if you show that if your engine family meets applicable emission levels for each pollutant.
their emission characteristics during the requirements. Section 1039.245 specifies how to test
useful life will be similar. (3) Before we test one of your engines, your engine to develop deterioration
(e) If you combine engines from we may set its adjustable parameters to factors that represent the deterioration
different power categories into a single any point within the physically expected in emissions over your
engine family under paragraph (d) of adjustable ranges (see § 1039.115(e)). engines’ full useful life. Your
this section, you must certify the engine (4) Before we test one of your engines, deterioration factors must take into
family to the more stringent set of we may calibrate it within normal account any available data from in-use
standards from the two power categories production tolerances for anything we testing with similar engines. Small-
in that model year. do not consider an adjustable parameter. volume engine manufacturers may use
(d) You may ask to use emission data assigned deterioration factors that we
§ 1039.235 What emission testing must I from a previous model year instead of establish. Apply deterioration factors as
perform for my application for a certificate doing new tests, but only if all the follows:
of conformity? following are true: (1) Additive deterioration factor for
This section describes the emission (1) The engine family from the exhaust emissions. Except as specified
testing you must perform to show previous model year differs from the in paragraph (c)(2) of this section, use
compliance with the emission standards current engine family only with respect an additive deterioration factor for
in § 1039.101(a) and (b) or § 1039.102(a) to model year. exhaust emissions. An additive
and (b). See § 1039.205(p) regarding (2) The emission-data engine from the deterioration factor for a pollutant is the
emission testing related to the NTE previous model year remains the difference between exhaust emissions at
the end of the useful life and exhaust total hydrocarbon (THC) emissions. the emission-data engine at least three
emissions at the low-hour test point. In Indicate in your application for times with evenly spaced intervals of
these cases, adjust the official emission certification if you are using this option. service accumulation. You may use
results for each tested engine at the If you do, measure THC emissions and extrapolation to determine deterioration
selected test point by adding the factor calculate NMHC emissions as 98 factors once you have established a
to the measured emissions. If the factor percent of THC emissions, as shown in trend of changing emissions with age for
is less than zero, use zero. Additive the following equation: each pollutant. You may use an engine
deterioration factors must be specified NMHC = (0.98) × (THC). installed in nonroad equipment to
to one more decimal place than the accumulate service hours instead of
applicable standard. § 1039.245 How do I determine running the engine only in the
(2) Multiplicative deterioration factor deterioration factors from exhaust laboratory. You may perform
for exhaust emissions. Use a durability testing?
maintenance on emission-data engines
multiplicative deterioration factor if Establish deterioration factors to as described in § 1039.125 and 40 CFR
good engineering judgment calls for the determine whether your engines will part 1065, subpart E. Use good
deterioration factor for a pollutant to be meet emission standards for each engineering judgment for all aspects of
the ratio of exhaust emissions at the end pollutant throughout the useful life, as the effort to establish deterioration
of the useful life to exhaust emissions at described in §§ 1039.101 and 1039.240. factors under this paragraph (c).
the low-hour test point. For example, if This section describes how to determine (d) Include the following information
you use aftertreatment technology that deterioration factors, either with an in your application for certification:
controls emissions of a pollutant engineering analysis, with pre-existing (1) If you use test data from a different
proportionally to engine-out emissions, test data, or with new emission engine family, explain why this is
it is often appropriate to use a measurements. If you are required to appropriate and include all the emission
multiplicative deterioration factor. perform durability testing, see measurements on which you base the
Adjust the official emission results for § 1039.125 for limitations on the deterioration factor.
each tested engine at the selected test maintenance that you may perform on (2) If you determine your
point by multiplying the measured your emission-data engine. deterioration factors based on
emissions by the deterioration factor. If (a) You may ask us to approve engineering analysis, explain why this
the factor is less than one, use one. A deterioration factors for an engine is appropriate and include a statement
multiplicative deterioration factor may family with established technology that all data, analyses, evaluations, and
not be appropriate in cases where based on engineering analysis instead of other information you used are available
testing variability is significantly greater testing. Engines certified to a for our review upon request.
than engine-to-engine variability. NOX+NMHC standard or FEL greater (3) If you do testing to determine
Multiplicative deterioration factors must than the Tier 3 NOX+NMHC standard deterioration factors, describe the form
be specified to one more significant described in 40 CFR 89.112 are and extent of service accumulation,
figure than the applicable standard. considered to rely on established including a rationale for selecting the
(3) Deterioration factor for smoke. technology for gaseous emission control, service-accumulation period and the
Deterioration factors for smoke are except that this does not include any method you use to accumulate hours.
always additive, as described in engines that use exhaust-gas
paragraph (c)(1) of this section. recirculation or aftertreatment. In most § 1039.250 What records must I keep and
(4) Deterioration factor for crankcase cases, technologies used to meet the what reports must I send to EPA?
emissions. If your engine vents Tier 1 and Tier 2 emission standards (a) Within 30 days after the end of the
crankcase emissions to the exhaust or to would be considered to be established model year, send the Designated
the atmosphere, you must account for technology. Compliance Officer a report describing
crankcase emission deterioration, using (b) You may ask us to approve the following information about engines
good engineering judgment. You may deterioration factors for an engine you produced during the model year:
use separate deterioration factors for family based on emission measurements (1) Report the total number of engines
crankcase emissions of each pollutant from similar highway or nonroad you produced in each engine family by
(either multiplicative or additive) or engines if you have already given us maximum engine power, total
include the effects in combined these data for certifying the other displacement, and the type of fuel
deterioration factors that include engines in the same or earlier model system.
exhaust and crankcase emissions years. Use good engineering judgment to (2) If you produced exempted engines
together for each pollutant. decide whether the two engines are under the provisions of § 1039.625,
(d) Collect emission data using similar. We will approve your request if report the number of exempted engines
measurements to one more decimal you show us that the emission you produced for each engine model
place than the applicable standard. measurements from other engines and identify the buyer or shipping
Apply the deterioration factor to the reasonably represent in-use destination for each exempted engine.
official emission result, as described in deterioration for the engine family for (b) Organize and maintain the
paragraph (c) of this section, then round which you have not yet determined following records:
the adjusted figure to the same number deterioration factors. (1) A copy of all applications and any
of decimal places as the emission (c) If you are unable to determine summary information you send us.
standard. Compare the rounded deterioration factors for an engine (2) Any of the information we specify
emission levels to the emission standard family under paragraph (a) or (b) of this in § 1039.205 that you were not required
for each emission-data engine. In the section, select engines, subsystems, or to include in your application.
case of NOX+NMHC standards, apply components for testing. Determine (3) A detailed history of each
the deterioration factor to each pollutant deterioration factors based on service emission-data engine. For each engine,
and then add the results before accumulation and related testing to describe all of the following:
rounding. represent the deterioration expected (i) The emission-data engine’s
(e) For engines subject to NMHC from in-use engines over the full useful construction, including its origin and
standards, you may base compliance on life. You must measure emissions from buildup, steps you took to ensure that
it represents production engines, any (1) Refuse to comply with any testing 1068, you must meet the labeling
components you built specially for it, or reporting requirements. requirements in § 1039.135, with the
and all the components you include in (2) Submit false or incomplete following exceptions:
your application for certification. information (paragraph (e) of this (1) Instead of the engine family
(ii) How you accumulated engine section applies if this is fraudulent). designation specified in
operating hours (service accumulation), (3) Render inaccurate any test data. § 1039.135(c)(3), use a modified
including the dates and the number of (4) Deny us from completing designation to identify the group of
hours accumulated. authorized activities despite our engines that would otherwise be
(iii) All maintenance, including presenting a warrant or court order (see included in the same engine family.
modifications, parts changes, and other 40 CFR 1068.20). This includes a failure (2) Instead of the compliance
service, and the dates and reasons for to provide reasonable assistance. statement in § 1039.135(c)(12), add the
the maintenance. (5) Produce engines for importation following statement: ‘‘THIS ENGINE
(iv) All your emission tests, including into the United States at a location MEETS U.S. EPA EMISSION
documentation on routine and standard where local law prohibits us from STANDARDS UNDER 40 CFR
tests, as specified in part 40 CFR part carrying out authorized activities. 1039.260.’’.
1065, and the date and purpose of each (6) Fail to supply requested (e) You may not generate ABT credits
test. information or amend your application with engines meeting requirements
(v) All tests to diagnose engine or to include all engines being produced. under the provisions of this section.
emission-control performance, giving (7) Take any action that otherwise (f) Keep records to show that you
circumvents the intent of the Act or this meet the alternate standards, as follows:
the date and time of each and the
part. (1) If your exempted engines are
reasons for the test.
(d) We may void your certificate if identical to previously certified engines,
(vi) Any other significant events.
you do not keep the records we require keep your most recent application for
(4) Production figures for each engine
or do not give us information when we certification for the certified engine
family divided by assembly plant.
ask for it. family.
(5) Keep a list of engine identification
(e) We may void your certificate if we (2) If you previously certified a
numbers for all the engines you produce
find that you intentionally submitted similar engine family, but have
under each certificate of conformity. false or incomplete information.
(c) Keep data from routine emission modified the exempted engine in a way
(f) If we deny your application or that changes it from its previously
tests (such as test cell temperatures and suspend, revoke, or void your
relative humidity readings) for one year certified configuration, keep your most
certificate, you may ask for a hearing recent application for certification for
after we issue the associated certificate (see § 1039.820).
of conformity. Keep all other the certified engine family, a description
information specified in paragraph (a) of § 1039.260 What provisions apply to of the relevant changes, and any test
this section for eight years after we issue engines that are conditionally exempted data or engineering evaluations that
your certificate. from certification? support your conclusions.
(d) Store these records in any format As specified elsewhere in this part or (3) If you have not previously certified
and on any media, as long as you can in 40 CFR part 1068, you may in some a similar engine family, keep all the
promptly send us organized, written cases introduce engines into commerce records we specify for the application
records in English if we ask for them. that are exempt from the requirement to for certification and the additional
You must keep these records readily certify engines to the otherwise records we specify in § 1039.250(b)(3).
available. We may review them at any applicable standards. If we specify (g) We may require you to send us an
time. alternate standards as a condition of the annual report of the engines you
(e) Send us copies of any engine exemption, all the following provisions produce under this section.
maintenance instructions or apply:
(a) Your engines must meet the Subpart D—[Reserved]
explanations if we ask for them.
alternate standards we specify in the
§ 1039.255 What decisions may EPA make exemption section, and all other Subpart E—In-Use Testing
regarding my certificate of conformity? requirements applicable to engines that § 1039.401 General provisions.
(a) If we determine your application is are subject to such standards.
complete and shows that the engine We may perform in-use testing of any
(b) You need not apply for and receive
family meets all the requirements of this engine subject to the standards of this
a certificate for the exempt engines.
part and the Act, we will issue a part. However, we will limit recall
However, you must comply with all the
certificate of conformity for your engine testing to the first 75 percent of each
requirements and obligations that would
family for that model year. We may engine’s useful life as specified in
apply to the engines if you had received
make the approval subject to additional § 1039.101(g).
a certificate of conformity for them,
conditions. unless we specifically waive certain Subpart F—Test Procedures
(b) We may deny your application for requirements.
certification if we determine that your (c) You must have emission data from § 1039.501 How do I run a valid emission
engine family fails to comply with testing engines using the appropriate test?
emission standards or other procedures that demonstrate (a) Use the equipment and procedures
requirements of this part or the Act. Our compliance with the alternate for compression-ignition engines in 40
decision may be based on a review of all standards, unless the engines are CFR part 1065 to determine whether
information available to us. If we deny identical in all material respects to engines meet the duty-cycle emission
your application, we will explain why engines that you have previously standards in § 1039.101(a) and (b).
in writing. certified to standards that are the same Measure the emissions of all the
(c) In addition, we may deny your as, or more stringent than, the alternate pollutants we regulate in § 1039.101 as
application or suspend or revoke your standards. specified in 40 CFR part 1065. Note that
certificate if you do any of the (d) Unless we specify otherwise we do not allow partial-flow sampling
following: elsewhere in this part or in 40 CFR part for measuring PM emissions on a
laboratory dynamometer for transient (1) For discrete-mode testing, sample (c) During idle mode, operate the
testing. Use the applicable duty cycles emissions separately for each mode, engine with the following parameters:
specified in §§ 1039.505 and 1039.510. then calculate an average emission level (1) Hold the speed within your
(b) Section 1039.515 describes the for the whole cycle using the weighting specifications.
supplemental procedures for evaluating factors specified for each mode. (2) Set the engine to operate at its
whether engines meet the not-to-exceed Calculate cycle statistics for the minimum fueling rate.
emission standards in § 1039.101(e). sequence of modes and compare with (3) Keep engine torque under 5
(c) Measure smoke using the the specified values in 40 CFR part 1065 percent of maximum test torque.
procedures in 40 CFR part 86, subpart to confirm that the test is valid. Operate (d) For full-load operating modes,
I, for evaluating whether engines meet the engine and sampling system as operate the engine at its maximum
the smoke standards in § 1039.105, follows: fueling rate. However, for constant-
except that you may test two-cylinder (i) Engines with NOX aftertreatment. speed engines whose design prevents
engines with an exhaust muffler like For engines that depend on full-load operation for extended periods,
those installed on in-use engines. aftertreatment to meet the NOX emission you may ask for approval under 40 CFR
standard, operate the engine for 5–6 1065.10(c) to replace full-load operation
(d) Use the fuels specified in
minutes, then sample emissions for 1– with the maximum load for which the
§ 1039.104(e) and 40 CFR part 1065 to
3 minutes in each mode. You may engine is designed to operate for
perform valid tests.
extend the sampling time to improve extended periods.
(1) For service accumulation, use the (e) See 40 CFR part 1065 for detailed
test fuel or any commercially available measurement accuracy of PM emissions,
using good engineering judgment. If you specifications of tolerances and
fuel that is representative of the fuel that calculations.
in-use engines will use. have a longer sampling time for PM
emissions, calculate and validate cycle (f) For those cases where transient
(2) For diesel-fueled engines, use the testing is not necessary, perform the
appropriate diesel fuel specified in 40 statistics separately for the gaseous and
PM sampling periods. steady-state test according to this
CFR part 1065 for emission testing. section after an appropriate warm-up
Unless we specify otherwise, the (ii) Engines without NOX
aftertreatment. For other engines, period, consistent with 40 CFR part
appropriate diesel test fuel is the ultra 1065, subpart F.
low-sulfur diesel fuel. If we allow you operate the engine for at least 5 minutes,
to use a test fuel with higher sulfur then sample emissions for at least 1 § 1039.510 Which duty cycles do I use for
levels, identify the test fuel in your minute in each mode. Calculate cycle transient testing?
application for certification and ensure statistics for the sequence of modes and (a) Measure emissions by testing the
that the emission control information compare with the specified values in 40 engine on a dynamometer with one of
label is consistent with your selection of CFR part 1065 to confirm that the test the following transient duty cycles to
the test fuel (see § 1039.135(c)(9)). For is valid. determine whether it meets the transient
example, do not test with ultra low- (2) For ramped-modal testing, start emission standards in § 1039.101(a):
sulfur diesel fuel if you intend to label sampling at the beginning of the first (1) For variable-speed engines, use the
your engines to allow use of diesel fuel mode and continue sampling until the transient duty cycle described in
with sulfur concentrations up to 500 end of the last mode. Calculate Appendix VI of this part.
ppm. emissions and cycle statistics the same (2) [Reserved]
(e) You may use special or alternate as for transient testing. (b) The transient test sequence
procedures to the extent we allow them (b) Measure emissions by testing the consists of an initial run through the
under 40 CFR 1065.10. engine on a dynamometer with one of transient duty cycle from a cold start, 20
(f) This subpart is addressed to you as the following duty cycles to determine minutes with no engine operation, then
a manufacturer, but it applies equally to whether it meets the steady-state a final run through the same transient
anyone who does testing for you, and to emission standards in § 1039.101(b): duty cycle. Start sampling emissions
us when we perform testing to (1) Use the 5-mode duty cycle or the immediately after you start the engine.
determine if your engines meet emission corresponding ramped-modal cycle Calculate the official transient emission
standards. described in Appendix II of this part for result from the following equation:
constant-speed engines. Note that these Official transient emission result = 0.05 ×
§ 1039.505 How do I test engines using cycles do not apply to all engines used cold-start emission rate + 0.95 × hot-start
steady-state duty cycles, including ramped- in constant-speed applications, as emission rate.
modal testing? described in § 1039.801.
(c) Cool the engine down between
This section describes how to test (2) Use the 6-mode duty cycle or the tests as described in 40 CFR 86.1335–90.
engines under steady-state conditions. corresponding ramped-modal cycle (d) For validating cycle statistics, you
In some cases, we allow you to choose described in Appendix III of this part for may delete from your regression
the appropriate steady-state duty cycle variable-speed engines below 19 kW. analysis speed, torque, and power
for an engine. In these cases, you must You may instead use the 8-mode duty points for the first 23 seconds and the
use the duty cycle you select in your cycle or the corresponding ramped- last 25 seconds of the transient duty
application for certification for all modal cycle described in Appendix IV cycle.
testing you perform for that engine of this part if some engines from your
family. If we test your engines to engine family will be used in § 1039.515 What are the test procedures
confirm that they meet emission applications that do not involve related to not-to-exceed standards?
standards, we will use the duty cycles governing to maintain engine operation (a) General provisions. The provisions
you select for your own testing. We may around rated speed. in 40 CFR 86.1370–2007 apply for
also perform other testing as allowed by (3) Use the 8-mode duty cycle or the determining whether an engine meets
the Clean Air Act. corresponding ramped-modal cycle the not-to-exceed emission standards in
(a) You may perform steady-state described in Appendix IV of this part § 1039.101(e). Interpret references to
testing with either discrete-mode or for variable-speed engines at or above 19 vehicles and vehicle operation to mean
ramped-modal cycles, as follows: kW. equipment and equipment operation.
(b) Special PM zone. For engines refers to regeneration events that are (c) Applying adjustment factors.
certified to a PM standard or FEL above expected to occur on average less than Apply adjustment factors based on
0.07 g/kW-hr, a modified NTE control once over the applicable transient duty whether regeneration occurs during the
area applies for PM emissions only. The cycle or ramped-modal cycle, or on test run. You must be able to identify
speeds and loads to be excluded are average less than once per typical mode regeneration in a way that is readily
determined based on speeds B and C, in a discrete-mode test. apparent during all testing.
determined according to the provisions (a) Developing adjustment factors. (1) If regeneration does not occur
of 40 CFR 86.1360–2007(c). One of the Develop an upward adjustment factor during a test segment, add an upward
following provisions applies: and a downward adjustment factor for adjustment factor to the measured
(1) If the C speed is below 2400 rpm, each pollutant based on measured emission rate. Determine the upward
exclude the speed and load points to the emission data and observed adjustment factor (UAF) using the
right of or below the line formed by regeneration frequency. Adjustment following equation:
connecting the following two points on factors should generally apply to an UAF = EFA ¥ EFL
a plot of speed-vs.-power: entire engine family, but you may
(i) 30% of maximum power at the B develop separate adjustment factors for (2) If regeneration occurs or starts to
speed; however, use the power value different engine configurations within occur during a test segment, subtract a
corresponding to the engine operation at an engine family. If you use adjustment downward adjustment factor from the
30% of maximum torque at the B speed factors for certification, you must measured emission rate. Determine the
if this is greater than 30% of maximum identify the frequency factor, F, from downward adjustment factor (DAF)
power at the B speed. paragraph (b) of this section in your using the following equation:
(ii) 70% of maximum power at 100% application for certification and use the DAF = EFH ¥ EFA
speed. adjustment factors in all testing for that (d) Sample calculation. If EFL is 0.10
(2) If the C speed is at or above 2400 engine family. You may use carryover or g/kW-hr, EFH is 0.50 g/kW-hr, and F is
rpm, exclude the speed and load points carry-across data to establish adjustment 0.1 (the regeneration occurs once for
to the right of the line formed by factors for an engine family, as each ten tests), then:
connecting the two points in paragraphs described in § 1039.235(d), consistent
EFA = (0.1)(0.5 g/kW-hr) + (1.0 ¥ 0.1)(0.1 g/
(b)(2)(i) and (ii) of this section (the 30% with good engineering judgment. All kW-hr) = 0.14 g/kW-hr.
and 50% torque/power points) and adjustment factors for regeneration are UAF = 0.14 g/kW-hr ¥ 0.10 g/kW-hr = 0.04
below the line formed by connecting the additive. Determine adjustment factors g/kW-hr.
two points in paragraphs (b)(2)(ii) and separately for different test segments. DAF = 0.50 g/kW-hr ¥ 0.14 g/kW-hr = 0.36
(iii) of this section (the 50% and 70% For example, determine separate g/kW-hr.
torque/power points). The 30%, 50%, adjustment factors for hot-start and
and 70% torque/power points are cold-start test segments and for different Subpart G—Special Compliance
defined as follows: modes of a discrete-mode steady-state Provisions
(i) 30% of maximum power at the B test. You may use either of the following
speed; however, use the power value different approaches for engines that use § 1039.601 What compliance provisions
corresponding to the engine operation at aftertreatment with infrequent apply to these engines?
30% of maximum torque at the B speed regeneration events: Engine and equipment manufacturers,
if this is greater than 30% of maximum (1) You may disregard this section if as well as owners, operators, and
power at the B speed. regeneration does not significantly affect rebuilders of engines subject to the
(ii) 50% of maximum power at 2400 emission levels for an engine family (or requirements of this part, and all other
rpm. configuration) or if it is not practical to persons, must observe the provisions of
(iii) 70% of maximum power at 100% identify when regeneration occurs. If this part, the requirements and
speed. you do not use adjustment factors under prohibitions in 40 CFR part 1068, and
this section, your engines must meet the provisions of the Act.
§ 1039.520 What testing must I perform to emission standards for all testing,
establish deterioration factors? § 1039.605 What provisions apply to
without regard to regeneration. engines already certified under the motor-
Sections 1039.240 and 1039.245 (2) If your engines use aftertreatment vehicle program?
describe the method for testing that technology with extremely infrequent
must be performed to establish (a) General provisions. If you are an
regeneration and you are unable to
deterioration factors for an engine engine manufacturer, this section allows
apply the provisions of this section, you
family. you to introduce new nonroad engines
may ask us to approve an alternate
into commerce if they are already
methodology to account for regeneration
§ 1039.525 How do I adjust emission levels certified to the requirements that apply
to account for infrequently regenerating events.
(b) Calculating average adjustment to compression-ignition engines under
aftertreatment devices? 40 CFR parts 85 and 86. If you comply
factors. Calculate the average
This section describes how to adjust with all the provisions of this section,
adjustment factor (EFA) based on the
emission results from engines using we consider the certificate issued under
following equation:
aftertreatment technology with 40 CFR part 86 for each engine to also
infrequent regeneration events. For this EFA = (F)(EFH) + (1-F)(EFL) be a valid certificate of conformity
section, ‘‘regeneration’’ means an Where: Ä under this part 1039 for its model year,
intended event during which emission F = the frequency of the regeneration event Ä without a separate application for
levels change while the system restores in terms of the fraction of tests during certification under the requirements of
aftertreatment performance. For which the regeneration occurs.
EFH = measured emissions from a test
this part 1039. See § 1039.610 for
example, exhaust gas temperatures may segment in which the regeneration similar provisions that apply to engines
increase temporarily to remove sulfur occurs. certified to chassis-based standards for
from adsorbers or to oxidize EFL = measured emissions from a test motor vehicles.
accumulated particulate matter in a segment in which the regeneration does (b) Equipment-manufacturer
trap. For this section, ‘‘infrequent’’ not occur. provisions. If you are not an engine
manufacturer, you may produce (iii) Modify or design the engine (iii) State: ‘‘We produce each listed
nonroad equipment using motor-vehicle cooling system so that temperatures or engine model for nonroad application
engines under this section as long as the heat rejection rates are outside the without making any changes that could
engine has been properly labeled as original engine manufacturer’s specified increase its certified emission levels, as
specified in paragraph (d)(5) of this ranges. described in 40 CFR 1039.605.’’.
section and you do not make any of the (3) You must show that fewer than 50 (e) Failure to comply. If your engines
changes described in paragraph (d)(2) of percent of the engine model’s total sales do not meet the criteria listed in
this section. You must also add the fuel- for the model year, from all companies, paragraph (d) of this section, they will
inlet label we specify in § 1039.135(e). are used in nonroad applications, as be subject to the standards,
If you modify the motor-vehicle engine follows: requirements, and prohibitions of this
in any of the ways described in (i) If you are the original manufacturer part 1039 and the certificate issued
paragraph (d)(2) of this section, we will of the engine, base this showing on your under 40 CFR part 86 will not be
consider you a manufacturer of a new sales information. deemed to also be a certificate issued
nonroad engine. Such engine (ii) In all other cases, you must get the under this part 1039. Introducing these
modifications prevent you from using original manufacturer of the engine to engines into commerce without a valid
the provisions of this section. confirm this based on its sales exemption or certificate of conformity
(c) Liability. Engines for which you information. under this part violates the prohibitions
meet the requirements of this section are (4) You must ensure that the engine in 40 CFR 1068.101(a)(1).
exempt from all the requirements and has the label we require under 40 CFR (f) Data submission. We may require
prohibitions of this part, except for part 86. you to send us emission test data on any
those specified in this section. Engines (5) You must add a permanent applicable nonroad duty cycles.
exempted under this section must meet supplemental label to the engine in a
position where it will remain clearly § 1039.610 What provisions apply to
all the applicable requirements from 40 vehicles already certified under the motor-
CFR parts 85 and 86. This paragraph (c) visible after installation in the
vehicle program?
applies to engine manufacturers, equipment. In the supplemental label,
do the following: (a) General provisions. If you are a
equipment manufacturers who use these motor-vehicle manufacturer, this section
engines, and all other persons as if these (i) Include the heading: ‘‘NONROAD
ENGINE EMISSION CONTROL allows you to introduce new nonroad
engines were used in a motor vehicle. engines or equipment into commerce if
The prohibited acts of § 1068.101(a)(1) INFORMATION’’.
(ii) Include your full corporate name the vehicle is already certified to the
apply to these new engines and requirements that apply under 40 CFR
and trademark. You may instead
equipment; however, we consider the parts 85 and 86. If you comply with all
include the full corporate name and
certificate issued under 40 CFR part 86 of the provisions of this section, we
trademark of another company you
for each engine to also be a valid consider the certificate issued under 40
choose to designate.
certificate of conformity under this part CFR part 86 for each motor vehicle to
(iii) State: ‘‘THIS ENGINE WAS
1039 for its model year. If we make a also be a valid certificate of conformity
ADAPTED FOR NONROAD USE
determination that these engines do not for the engine under this part 1039 for
WITHOUT AFFECTING ITS EMISSION
conform to the regulations during their its model year, without a separate
CONTROLS. THE EMISSION-
useful life, we may require you to recall application for certification under the
CONTROL SYSTEM DEPENDS ON THE
them under 40 CFR part 85 or 40 CFR requirements of this part 1039. See
USE OF FUEL MEETING
1068.505. § 1039.605 for similar provisions that
SPECIFICATIONS THAT APPLY FOR
(d) Specific requirements. If you are MOTOR-VEHICLE APPLICATIONS. apply to motor-vehicle engines
an engine manufacturer and meet all the OPERATING THE ENGINE ON OTHER produced for nonroad equipment.
following criteria and requirements FUELS MAY BE A VIOLATION OF (b) Equipment-manufacturer
regarding your new nonroad engine, the FEDERAL LAW.’’. provisions. If you are not an engine
engine is eligible for an exemption (iv) State the date you finished manufacturer, you may produce
under this section: modifying the engine (month and year), nonroad equipment from motor vehicles
(1) Your engine must be covered by a if applicable. under this section as long as the
valid certificate of conformity issued (6) The original and supplemental equipment has the labels specified in
under 40 CFR part 86. labels must be readily visible after the paragraph (d)(5) of this section and you
(2) You must not make any changes to engine is installed in the equipment or, do not make any of the changes
the certified engine that could if the equipment obscures the engine’s described in paragraph (d)(2) of this
reasonably be expected to increase its emission control information label, the section. You must also add the fuel-inlet
exhaust emissions for any pollutant, or equipment manufacturer must attach label we specify in § 1039.135(e). If you
its evaporative emissions if it is subject duplicate labels, as described in 40 CFR modify the motor vehicle or its engine
to evaporative-emission standards. For 1068.105. in any of the ways described in
example, if you make any of the (7) You must make sure that nonroad paragraph (d)(2) of this section, we will
following changes to one of these equipment produced under this section consider you a manufacturer of a new
engines, you do not qualify for this will have the fueling label we specify in nonroad engine. Such modifications
exemption: § 1039.135(c)(9)(i). prevent you from using the provisions
(i) Change any fuel system parameters (8) Send the Designated Compliance of this section.
from the certified configuration. Officer a signed letter by the end of each (c) Liability. Engines, vehicles, and
(ii) Change, remove, or fail to properly calendar year (or less often if we tell equipment for which you meet the
install any other component, element of you) with all the following information: requirements of this section are exempt
design, or calibration specified in the (i) Identify your full corporate name, from all the requirements and
engine manufacturer’s application for address, and telephone number. prohibitions of this part, except for
certification. This includes (ii) List the engine models you expect those specified in this section. Engines
aftertreatment devices and all related to produce under this exemption in the exempted under this section must meet
components. coming year. all the applicable requirements from 40
CFR parts 85 and 86. This applies to (4) The equipment must have the § 1039.615 What special provisions apply
engine manufacturers, equipment vehicle emission control information to engines using noncommercial fuels?
manufacturers, and all other persons as and fuel labels we require under 40 CFR In § 1039.115(e), we generally require
if the nonroad equipment were motor 86.007–35. that engines meet emission standards
vehicles. The prohibited acts of (5) You must add a permanent for any adjustment within the full range
§ 1068.101(a)(1) apply to these new supplemental label to the equipment in of any adjustable parameters. For
pieces of equipment; however, we a position where it will remain clearly engines that use noncommercial fuels
consider the certificate issued under 40 visible. In the supplemental label, do significantly different than the specified
CFR part 86 for each motor vehicle to the following: test fuel of the same type, you may ask
also be a valid certificate of conformity (i) Include the heading: ‘‘NONROAD to use the parameter-adjustment
for the engine under this part 1039 for ENGINE EMISSION CONTROL provisions of this section instead of
its model year. If we make a INFORMATION’’. those in § 1039.115(e). Engines certified
determination that these engines, under this section must be in a separate
vehicles, or equipment do not conform (ii) Include your full corporate name engine family.
to the regulations during their useful and trademark. You may instead (a) If we approve your request, the
life, we may require you to recall them include the full corporate name and following provisions apply:
under 40 CFR part 86 or 40 CFR trademark of another company you (1) You must certify the engine using
1068.505. choose to designate. the test fuel specified in § 1039.501.
(d) Specific requirements. If you are a (iii) State: ‘‘THIS VEHICLE WAS (2) You may produce the engine
motor-vehicle manufacturer and meet ADAPTED FOR NONROAD USE without limits or stops that keep the
all the following criteria and WITHOUT AFFECTING ITS EMISSION engine adjusted within the certified
requirements regarding your new CONTROLS. THE EMISSION- range.
nonroad equipment and its engine, the CONTROL SYSTEM DEPENDS ON THE (3) You must specify in-use
engine is eligible for an exemption USE OF FUEL MEETING adjustments different than the
under this section: SPECIFICATIONS THAT APPLY FOR adjustable settings appropriate for the
(1) Your equipment must be covered MOTOR-VEHICLE APPLICATIONS. specified test fuel, consistent with the
by a valid certificate of conformity as a OPERATING THE ENGINE ON OTHER provisions of paragraph (b)(1) of this
motor vehicle issued under 40 CFR part FUELS MAY BE A VIOLATION OF section.
86. FEDERAL LAW.’’. (b) To produce engines under this
(2) You must not make any changes to (iv) State the date you finished section, you must do the following:
the certified vehicle that we could modifying the vehicle (month and year), (1) Specify in-use adjustments needed
reasonably expect to increase its exhaust if applicable. so the engine’s level of emission control
emissions for any pollutant, or its (6) The original and supplemental for each regulated pollutant is
evaporative emissions if it is subject to labels must be readily visible in the equivalent to that from the certified
evaporative-emission standards. For fully assembled equipment. configuration.
example, if you make any of the (2) Add the following information to
(7) Send the Designated Compliance
following changes, you do not qualify the emission control information label
Officer a signed letter by the end of each
for this exemption: specified in § 1039.135:
calendar year (or less often if we tell (i) Include instructions describing
(i) Change any fuel system parameters you) with all the following information:
from the certified configuration. how to adjust the engine to operate in
(i) Identify your full corporate name, a way that maintains the effectiveness of
(ii) Change, remove, or fail to properly address, and telephone number.
install any other component, element of the emission-control system.
design, or calibration specified in the (ii) List the equipment models you (ii) State: ‘‘THIS ENGINE IS
vehicle manufacturer’s application for expect to produce under this exemption CERTIFIED TO OPERATE IN
certification. This includes in the coming year. APPLICATIONS USING
aftertreatment devices and all related (iii) State: ‘‘We produce each listed NONCOMMERCIAL FUEL.
components. engine or equipment model for nonroad MALADJUSTMENT OF THE ENGINE IS
(iii) Modify or design the engine application without making any changes A VIOLATION OF FEDERAL LAW
cooling system so that temperatures or that could increase its certified emission SUBJECT TO CIVIL PENALTY.’’.
heat rejection rates are outside the levels, as described in 40 CFR (3) Keep records to document the
original vehicle manufacturer’s 1039.610.’’. destinations and quantities of engines
specified ranges. (e) Failure to comply. If your engines, produced under this section.
(iv) Add more than 500 pounds to the vehicles, or equipment do not meet the § 1039.620 What are the provisions for
curb weight of the originally certified criteria listed in paragraph (d) of this exempting engines used solely for
motor vehicle. section, the engines will be subject to competition?
(3) You must show that fewer than 50 the standards, requirements, and The provisions of this section apply
percent of the total sales as a motor prohibitions of this part 1039, and the for new engines built on or after January
vehicle or a piece of nonroad certificate issued under 40 CFR part 86 1, 2006.
equipment, from all companies, are will not be deemed to also be a (a) Equipment manufacturers may use
used in nonroad applications, as certificate issued under this part 1039. uncertified engines if the vehicles or
follows: Introducing these engines into equipment in which they are installed
(i) If you are the original manufacturer commerce without a valid exemption or will be used solely for competition.
of the vehicle, base this showing on certificate of conformity under this part (b) The definition of nonroad engine
your sales information. violates the prohibitions in 40 CFR in 40 CFR 1068.30 excludes engines
(ii) In all other cases, you must get the 1068.101(a)(1). used solely for competition. These
original manufacturer of the vehicle to (f) Data submission. We may require engines are not required to comply with
confirm this based on their sales you to send us emission test data on any this part 1039 or 40 CFR part 89, but 40
information. applicable nonroad duty cycles. CFR 1068.101 prohibits the use of
competition engines for noncompetition engine separately. These provisions are (ii) For engines below 130 kW, you
purposes. available over the following periods: may produce up to 525 units with
(c) We consider a vehicle or piece of (1) These provisions are available for exempted engines within a power
equipment to be one that will be used the years shown in the following table, category during the seven-year period
solely for competition if it has features except as provided in paragraph (a)(2) of specified in paragraph (a) of this
that are not easily removed that would this section: section, with no more than 150 units in
make its use other than in competition any single year within a power category,
unsafe, impractical, or highly unlikely. TABLE 1 OF § 1039.625.—G ENERAL except as provided in paragraph (m) of
(d) As an engine manufacturer, your AVAILABILITY OF ALLOWANCES this section. For engines at or above 130
engine is exempt without our prior kW, you may produce up to 350 units
approval if you have a written request Power category Calendar years with exempted engines within a power
for an exempted engine from the category during the seven-year period,
equipment manufacturer showing the kW < 19 ............................ 2008–2014 with no more than 100 units in any
basis for believing that the equipment 19 ≤ kW < 56 .................... 2008–2014 single year within a power category.
will be used solely for competition. You 56 ≤ kW < 130 .................. 2012–2018
Exemptions under this paragraph
130 ≤ kW ≤ 560 ................ 2011–2017
must permanently label engines kW < 560 .......................... 2011–2017 (b)(2)(ii) may apply to engines from
exempted under this section to clearly multiple engine families in a given year.
indicate that they are to be used solely (2) If you do not use any allowances (c) Percentage calculation. Calculate
for competition. Failure to properly in a power category before the earliest for each calendar year the percentage of
label an engine will void the exemption. dates shown in the following table, you equipment with exempted engines from
(e) We may discontinue an exemption may delay the start of the seven-year your total U.S.-directed production
under this section if we find that period for using allowances under this within a power category if you need to
engines are not used solely for section as follows: show that you meet the percent-of-
competition. production allowances in paragraph
TABLE 2 OF § 1039.625.—A VAIL-
(b)(1) of this section.
§ 1039.625 What requirements apply under (d) Inclusion of engines not subject to
the program for equipment-manufacturer ABILITY OF DELAYED ALLOWANCES Tier 4 standards. The following
flexibility?
provisions apply to engines that are not
The provisions of this section allow Power category Calendar years
subject to Tier 4 standards:
equipment manufacturers to produce (1) If you use the provisions of
kW < 19 ............................ ............................
equipment with engines that are subject § 1068.105(a) to use up your inventories
19 ≤ kW < 56 .................... 2012–2018
to less stringent emission standards after 56 ≤ kW < 130 .................. 2014–2020 of engines not certified to new emission
the Tier 4 emission standards begin to 130 ≤ kW ≤ 560 ................ 2014–2020 standards, do not include these units in
apply. To be eligible to use these kW > 560 .......................... 2015–2021 your count of equipment with exempted
provisions, you must follow all the engines under paragraph (b) of this
instructions in this section. See 40 CFR (b) Allowances. You may choose one section. However, you may include
89.102(d) and (e) for provisions that of the following options for each power these units in your count of total
apply to equipment produced while category to produce equipment with equipment you produce for the given
Tier 1, Tier 2, or Tier 3 standards apply. exempted engines under this section, year for the percentage calculation in
See § 1039.626 for requirements that except as allowed under § 1039.627: paragraph (b)(1) of this section.
apply specifically to companies that (1) Percent-of-production allowances. (2) If you install engines that are
manufacture equipment outside the You may produce a certain number of exempted from the Tier 4 standards for
United States and to companies that units with exempted engines calculated any reason, other than for equipment-
import such equipment without using a percentage of your total sales manufacturer allowances under this
manufacturing it. Engines and within a power category relative to your section, do not include these units in
equipment you produce under this total U.S.-directed production volume. your count of exempted engines under
section are exempt from the The sum of these percentages within a paragraph (b) of this section. However,
prohibitions in 40 CFR 1068.101(a)(1), power category during the seven-year you may include these units in your
subject to the provisions of this section. period specified in paragraph (a) of this count of total equipment you produce
(a) General. If you are an equipment section may not exceed 80 percent, for the given year for the percentage
manufacturer, you may introduce into except as allowed under paragraph calculation in paragraph (b)(1) of this
commerce in the United States limited (b)(2) or (m) of this section. section. For example, if we grant a
numbers of nonroad equipment with (2) Small-volume allowances. You hardship exemption for the engine
engines exempted under this section. may determine an alternate allowance manufacturer, you may count these as
You may use the exemptions in this for a specific number of exempted compliant engines under this section.
section only if you have primary engines under this section using one of This paragraph (d)(2) applies only if the
responsibility for designing and the following approaches for your U.S.- engine has a permanent label describing
manufacturing equipment and your directed production volumes: why it is exempted from the Tier 4
manufacturing procedures include (i) You may produce up to 700 units standards.
installing some engines in this with exempted engines within a power (3) Do not include equipment using
equipment. Consider all U.S.-directed category during the seven-year period model year 2008 or 2009 engines
equipment sales in showing that you specified in paragraph (a) of this certified under the provisions of
meet the requirements of this section, section, with no more than 200 units in § 1039.101(c) in your count of
including those from any parent or any single year within a power category, equipment using exempted engines.
subsidiary companies and those from except as provided in paragraph (m) of However, you may include these units
any other companies you license to this section. Engines within a power in your count of total equipment you
produce equipment for you. If you category that are exempted under this produce for the given year for the
produce a type of equipment that has section must be from a single engine percentage calculation in paragraph
more than one engine, count each family within a given year. (b)(1) of this section.
(4) You may start using the Must meet all you intend to comply under paragraph
allowances under this section for standards and (b)(1) or (b)(2) of this section.
engines that are not yet subject to Tier Engines in the following
requirements that (vi) The number of units in each
4 standards, as long as the seven-year power category . . . applied in the fol- power category you have sold in
lowing model
period for using allowances under the year . . . previous calendar years under 40 CFR
Tier 2 or Tier 3 program has expired 89.102(d).
(see 40 CFR 89.102(d)). Table 3 of this (i) 19 ≤ kW < 56 ............... 2008 (2) For each year that you use the
section shows the years for which this (ii) 56 ≤ kW < 130 ............ 2012 provisions of this section, send the
applies. To use these early allowances, (iii) 130 ≤ kW ≤ 560 .......... 2011 Designated Compliance Officer and the
you must use engines that meet the (iv) kW > 560 .................... 2011 Designated Enforcement Officer a
emission standards described in written report by March 31 of the
paragraph (e) of this section. You must (3) In all other cases, engines at or following year. Include in your report
also count these units or calculate these above 37 kW and at or below 560 kW the total number of engines you sold in
percentages as described in paragraph must meet the appropriate Tier 3 the preceding year for each power
(c) of this section and apply them standards described in § 89.112. Engines category, based on actual U.S.-directed
toward the total number or percentage below 37 kW and engines above 560 kW production information. Also identify
of equipment with exempted engines we must meet the appropriate Tier 2 the percentages of U.S.-directed
allow for the Tier 4 standards as standards described in § 89.112. production that correspond to the
described in paragraph (b) of this (f) Equipment labeling. You must add number of units in each power category
section. The maximum number of a permanent label, written legibly in and the cumulative numbers and
cumulative early allowances under this English, to the engine or another readily percentages of units for all the units you
paragraph (d)(4) is 10 percent under the visible part of each piece of equipment have sold under this section for each
percent-of-production allowance or 100 you produce with exempted engines power category. You may omit the
units under the small-volume under this section. This label, which percentage figures if you include in the
allowance. For example, if you produce supplements the engine manufacturer’s report a statement that you will not be
5 percent of your equipment with emission control information label, using the percent-of-production
engines between 130 and 560 kW that must include at least the following allowances in paragraph (b)(1) of this
use allowances under this paragraph items: section.
(d)(4) in 2009, you may use up to an (1) The label heading ‘‘EMISSION (h) Recordkeeping. Keep the following
additional 5 percent of your allowances CONTROL INFORMATION’’. records of all equipment with exempted
in 2010. If you use allowances for 5 (2) Your corporate name and engines you produce under this section
percent of your equipment in both 2009 trademark. for at least five full years after the final
(3) The calendar year in which the year in which allowances are available
and 2010, your 80 percent allowance for
equipment is manufactured. for each power category:
2011–2017 in the 130–560 kW power
(4) The name, e-mail address, and (1) The model number, serial number,
category decreases to 70 percent.
phone number of a person to contact for and the date of manufacture for each
Manufacturers using allowances under
further information. engine and piece of equipment.
this paragraph (d)(4) must comply with (5) The following statement:
the notification and reporting (2) The maximum power of each
requirements specified in paragraph (g) THIS EQUIPMENT [or identify the type of engine.
of this section. equipment] HAS AN ENGINE THAT MEETS (3) The total number or percentage of
U.S. EPA EMISSION STANDARDS UNDER equipment with exempted engines, as
40 CFR 1039.625. described in paragraph (b) of this
TABLE 3 OF § 1039.625.—Y EARS FOR
EARLY ALLOWANCES (g) Notification and reporting. You section and all documentation
must notify us of your intent to use the supporting your calculation.
Maximum engine power Calendar years provisions of this section and send us (4) The notifications and reports we
an annual report to verify that you are require under paragraph (g) of this
kW < 19 ............................ 2007 not exceeding the allowances, as section.
19 ≤ kW < 37 .................... 2006–2011 follows: (i) Enforcement. Producing more
37 ≤ kW < 56 .................... 2011 (1) Before January 1 of the first year exempted engines or equipment than we
56 ≤ kW < 75 .................... 2011 you intend to use the provisions of this allow under this section or installing
75 ≤ kW < 130 .................. 2010–2011 engines that do not meet the emission
130 ≤ kW < 225 ................ 2010 section, send the Designated
225 ≤ kW < 450 ................ 2008–2010 Compliance Officer and the Designated standards of paragraph (e) of this section
450 ≤ kW ≤ 560 ................ 2009–2010 Enforcement Officer a written notice of violates the prohibitions in 40 CFR
KW > 560 ......................... ............................ your intent, including: 1068.101(a)(1). You must give us the
(i) Your company’s name and address, records we require under this section if
(e) Standards. If you produce and your parent company’s name and we ask for them (see 40 CFR
equipment with exempted engines address, if applicable. 1068.101(a)(2)).
under this section, the engines must (ii) Whom to contact for more (j) Provisions for engine
meet emission standards at least as information. manufacturers. As an engine
stringent as the following: (iii) The calendar years in which you manufacturer, you may produce
(1) If you are using the provisions of expect to use the exemption provisions exempted engines as needed under this
paragraph (d)(4) of this section, engines of this section. section. You do not have to request this
must meet the applicable Tier 1 (iv) The name and address of the exemption for your engines, but you
emission standards described in company that produces the engines you must have written assurance from
§ 89.112. will be using for the equipment equipment manufacturers that they need
(2) If you are using the provisions of exempted under this section. a certain number of exempted engines
paragraph (a)(2) of this section, engines (v) Your best estimate of the number under this section. Send us an annual
must be certified under this part 1039 as of units in each power category you will report of the engines you produce under
follows: produce under this section and whether this section, as described in
§ 1039.250(a). For engines produced (2) To apply for exemptions under only for the specific equipment models
under the provisions of paragraph (a)(2) this paragraph (m), send the Designated covered by your request.
of this section, you must certify the Compliance Officer and the Designated (4) We may approve your request to
engines under this part 1039. For all Enforcement Officer a written request as increase the allowances for the 19–56
other exempt engines, the engines must soon as possible before you are in kW power category under paragraph
meet the emission standards in violation. In your request, include the (b)(2) of this section, subject to the
paragraph (e) of this section and you following information: following limitations:
must meet all the requirements of (i) Describe your process for designing (i) You are eligible for additional
§ 1039.260. If you show under equipment. allowances under this paragraph (m)(4)
§ 1039.260(c) that the engines are (ii) Describe how you normally work only if you are a small equipment
identical in all material respects to cooperatively or concurrently with your manufacturer and you do not use the
engines that you have previously engine supplier to design products. provisions of paragraph (m)(3) of this
certified to one or more FELs above the (iii) Describe the engineering or section to obtain additional allowances
standards specified in paragraph (e) of technical problems causing you to for the 19–56 kW power category.
this section, you must supply sufficient request the exemption and explain why (ii) You must use up all the available
credits for these engines. Calculate these you have not been able to solve them. allowances for the 19–56 kW power
credits under subpart H of this part Describe the extreme and unusual category under paragraph (b)(2) of this
using the previously certified FELs and circumstances that led to these section in a given year before using any
the alternate standards. You must meet problems and explain how they were additional allowances under this
the labeling requirements in 40 CFR unavoidable. paragraph (m)(4).
89.110, but add the following statement (iv) Describe any information or (iii) Base your request only on
instead of the compliance statement in products you received from your engine equipment you produce with engines at
40 CFR 89.110(b)(10): supplier related to equipment design— or above 19 kW and below 37 kW. You
such as written specifications, may use any additional allowances only
THIS ENGINE MEETS U.S. EPA EMISSION
STANDARDS UNDER 40 CFR 1039.625. performance data, or prototype for equipment you produce with
SELLING OR INSTALLING THIS ENGINE engines—and when you received it. engines at or above 19 kW and below 37
FOR ANY PURPOSE OTHER THAN FOR (v) Compare the design processes of kW.
THE EQUIPMENT FLEXIBILITY the equipment model for which you (iv) The total allowances under either
PROVISIONS OF 40 CFR 1039.625 MAY BE need additional exemptions and that for paragraph (b)(2)(i) or (ii) of this section
A VIOLATION OF FEDERAL LAW SUBJECT other models for which you do not need for the 19–56 kW power category will
TO CIVIL PENALTY. not exceed 1,100 units.
additional exemptions. Explain the
(k) Other exemptions. See 40 CFR technical differences that justify your (v) Any allowances we approve under
1068.255 for exemptions based on request. this paragraph (m)(4) expire 36 months
hardship for equipment manufacturers (vi) Describe your efforts to find and after the provisions of this section start
and secondary engine manufacturers. use other compliant engines, or for this power category, as described in
(l) [Reserved] otherwise explain why none is paragraph (a) of this section. These
(m) Additional exemptions for available. additional allowances are not subject to
technical or engineering hardship. You (vii) Describe the steps you have taken the annual limits specified in paragraph
may request additional engine to minimize the scope of your request. (b)(2) of this section. You may use these
allowances under paragraph (b)(1) of (viii) Include other relevant allowances only for the specific
this section for 19–560 kW power information. You must give us other equipment models covered by your
categories or, if you are a small relevant information if we ask for it. request.
equipment manufacturer, under (ix) Estimate the increased percent of (5) For purposes of this paragraph (m),
paragraph (b)(2) of this section for production you need for each small equipment manufacturer means a
engines at or above 19 and below 37 equipment model covered by your small-business equipment manufacturer
kW. However, you may use these extra request, as described in paragraph that had annual U.S.-directed
allowances only for those equipment (m)(3) of this section. Estimate the production volume of equipment using
models for which you, or an affiliated increased number of allowances you nonroad diesel engines between 19 and
company, do not also produce the need for each equipment model covered 56 kW of no more than 3,000 units in
engine. After considering the by your request, as described in 2002 and all earlier calendar years, and
circumstances, we may permit you to paragraph (m)(4) of this section. has 750 or fewer employees (500 or
introduce into commerce equipment (3) We may approve your request to fewer employees for nonroad equipment
with such engines that do not comply increase the allowances under manufacturers that produce no
with Tier 4 emission standards, as paragraph (b)(1) of this section, subject construction equipment or industrial
follows: to the following limitations: trucks). For manufacturers owned by a
parent company, the production limit
(1) We may approve additional (i) The additional allowances will not
applies to the production of the parent
exemptions if extreme and unusual exceed 70 percent for each power
company and all its subsidiaries and the
circumstances that are clearly outside category.
employee limit applies to the total
your control and that could not have (ii) You must use up the allowances
number of employees of the parent
been avoided with reasonable discretion under paragraph (b)(1) of this section
company and all its subsidiaries.
have resulted in technical or before using any additional allowance
engineering problems that prevent you under this paragraph (m). § 1039.626 What special provisions apply
from meeting the requirements of this (iii) Any allowances we approve to equipment imported under the
part. You must show that you exercised under this paragraph (m)(3) expire 24 equipment-manufacturer flexibility
prudent planning and have taken all months after the provisions of this program?
reasonable steps to minimize the scope section start for a given power category, This section describes requirements
of your request for additional as described in paragraph (a) of this that apply to equipment manufacturers
allowances. section. You may use these allowances using the provisions of § 1039.625 for
equipment produced outside the United promulgated thereunder shall be appropriate bond amount is $180,000. If
States. Note that § 1039.625 limits these governed by the Clean Air Act. your estimated or actual engine imports
provisions to equipment manufacturers (4) The substantive and procedural increase beyond the level appropriate
that install some engines and have laws of the United States shall apply to for your current bond payment, you
primary responsibility for designing and any civil or criminal enforcement action must post additional bond to reflect the
manufacturing equipment. Companies against you or any of your officers or increased sales within 90 days after you
that import equipment into the United employees related to the provisions of change your estimate or determine the
States without meeting these criteria are this section. actual sales. You may not decrease your
not eligible for these allowances. Such (5) Provide the notification required bond.
importers may import equipment with by § 1039.625(g). Include in the notice (ii) You may meet the bond
exempted engines only as described in of intent in § 1039.625(g)(1) a requirements of this section with any of
paragraph (b) of this section. commitment to comply with the the following methods:
(a) As a foreign equipment requirements and obligations of (A) Get a bond from a third-party
manufacturer, you or someone else may § 1039.625 and this section. This surety that is cited in the U.S.
import equipment with exempted commitment must be signed by the Department of Treasury Circular 570,
engines under this section if you owner or president. ‘‘Companies Holding Certificates of
comply with the provisions in (6) You, your agents, officers, and Authority as Acceptable Sureties on
§ 1039.625 and commit to the following: employees must not seek to detain or to Federal Bonds and as Acceptable
(1) Give any EPA inspector or auditor impose civil or criminal remedies Reinsuring Companies.’’ Maintain this
complete and immediate access to against EPA inspectors or auditors, bond for five years after the applicable
inspect and audit, as follows: whether EPA employees or EPA allowance period expires, or five years
(i) Inspections and audits may be contractors, for actions performed after you use up all the available
announced or unannounced. within the scope of EPA employment allowances under § 1039.625, whichever
(ii) Inspections and audits may be by related to the provisions of this section. comes first.
EPA employees or EPA contractors. (7) By submitting notification of your (B) Get the Designated Enforcement
(iii) You must provide access to any intent to use the provisions of Officer to approve a waiver from the
location where— § 1039.625, producing and exporting for bonding requirement, as long as you can
(A) Any nonroad engine, equipment, resale to the United States nonroad show that you have assets of an
or vehicle is produced or stored. equipment under this section, or taking appropriate liquidity and value readily
(B) Documents related to other actions to comply with the available in the United States.
manufacturer operations are kept. requirements of this part, you, your (iii) If you forfeit some or all of your
(C) Equipment, engines, or vehicles agents, officers, and employees, without bond in an enforcement action, you
are tested or stored for testing. exception, become subject to the full must post any appropriate bond for
(iv) You must provide any documents operation of the administrative and continuing importation within 90 days
requested by an EPA inspector or judicial enforcement powers and after you forfeit the bond amount.
auditor that are related to matters provisions of the United States as
covered by the inspections or audit. described in 28 U.S.C. 1605(a)(2), TABLE 1 OF § 1039.626.—P ER-
(v) EPA inspections and audits may without limitation based on sovereign ENGINE BOND VALUES
include review and copying of any immunity, for conduct that violates the
documents related to demonstrating requirements applicable to you under For engines with maximum The per-en-
compliance with the exemptions in this part 1039—including such conduct engine power falling in the gine bond
§ 1039.625. that violates 18 U.S.C. 1001, 42 U.S.C. following ranges . . . value is . . .
(vi) EPA inspections and audits may 7413(c)(2), or other applicable
kW < 19 ................................ $150
include inspection and evaluation of provisions of the Clean Air Act’with 19 ≤ kW < 56 ........................ 300
complete or incomplete equipment, respect to actions instituted against you 56 ≤ kW < 130 ...................... 500
engines, or vehicles, and interviewing and your agents, officers, and employees 130 ≤ kW < 225 .................... 1,000
employees. in any court or other tribunal in the 225 ≤ kW < 450 .................... 3,000
(vii) You must make any of your United States. kW ≥ 450 .............................. 8,000
employees available for interview by the (8) Any report or other document you
EPA inspector or auditor, on request, submit to us must be in the English (iv) You will forfeit the proceeds of
within a reasonable time period. language, or include a complete the bond posted under this paragraph
(viii) You must provide English translation in English. (a)(9) if you need to satisfy any United
language translations of any documents (9) You must post a bond to cover any States administrative final order or
to an EPA inspector or auditor, on potential enforcement actions under the judicial judgment against you arising
request, within 10 working days. Clean Air Act before you or anyone else from your conduct in violation of this
(ix) You must provide English- imports your equipment under this part 1039, including such conduct that
language interpreters to accompany EPA section, as follows: violates 18 U.S.C. 1001, 42 U.S.C.
inspectors and auditors, on request. (i) The value of the bond is based on 7413(c)(2), or other applicable
(2) Name an agent for service of the per-engine bond values shown in provisions of the Clean Air Act.
process located in the District of Table 1 of this section and on the (b) The provisions of this paragraph
Columbia. Service on this agent highest number of engines in each (b) apply to importers that do not install
constitutes service on you or any of your power category you produce in any engines into equipment and do not have
officers or employees for any action by single calendar year under the primary responsibility for designing and
EPA or otherwise by the United States provisions of § 1039.625. For example, if manufacturing equipment. Such
related to the requirements of this part. you have projected U.S.-directed importers may import equipment with
(3) The forum for any civil or criminal production volumes of 100 exempt engines exempted under § 1039.625
enforcement action related to the engines in the 19–56 kW power category only if each engine is exempted under
provisions of this section for violations and 300 exempt engines in the 56–130 an allowance provided to an equipment
of the Clean Air Act or regulations kW power category in 2013, the manufacturer meeting the requirements
of § 1039.625 and this section. You must (iv) The number of units in each using engines at or above 19 kW
notify us of your intent to use the power category you have imported in certified to specified levels earlier than
provisions of this section and send us previous calendar years under 40 CFR otherwise required.
an annual report, as follows: 89.102(d). (a) For early-compliant engines to
(1) Before January 1 of the first year (2) For each year that you use the generate offsets for use under this
you intend to use the provisions of this provisions of this section, send the section, the following general provisions
section, send the Designated Designated Compliance Officer and the
Compliance Officer and the Designated apply:
Designated Enforcement Officer a
Enforcement Officer a written notice of written report by March 31 of the (1) The engine manufacturer must
your intent, including: following year. Include in your report comply with the provisions of
(i) Your company’s name and address, the total number of engines you § 1039.104(a)(1) for the offset-generating
and your parent company’s name and imported under this section in the engines.
address, if applicable. preceding calendar year, broken down (2) Engines you install in your
(ii) The name and address of the by engine manufacturer and by equipment after December 31 of the
companies that produce the equipment equipment manufacturer. years specified in § 1039.104(a)(1) do
and engines you will be importing
not generate allowances under this
under this section. § 1039.627 What are the incentives for
(iii) Your best estimate of the number equipment manufacturers to use cleaner section, even if the engine manufacturer
of units in each power category you will engines? generated offsets for that engine under
import under this section in the This section allows equipment § 1039.104(a).
upcoming calendar year, broken down manufacturers to generate additional (3) Offset-generating engines must be
by equipment manufacturer and power allowances under the provisions of certified to the following standards
category. § 1039.625 by producing equipment under this part 1039:
You may reduce the number of en

If the engine’s max In later model
And you install . . . Certified early to the . . . gines in the same power category
imum power is . . . years by . . .
that are required to meet the . . .
(i) kW ≥ 19 ................. One engine ................ Emissions standards in § 1039.101 .. Standards in Tables 2 through 7 of One engine.
§ 1039.102 or in § 1039.101.
(ii) 56 ≤ kW < 130 ..... Two engines .............. NOX standards in § 1039.102(d)(1), Standards in Tables 2 through 7 of One engine.
and NMHC standard of 0.19 g/kW § 1039.102 or in § 1039.101.
hr, a PM standard of 0.02 g/kW-hr,
and a CO standard of 5.0 g/kW-hr.
(iii) 130 ≤ kW < 560 .. Two engines .............. NOX standards in § 1039.102(d)(2), Standards in Tables 2 through 7 of One engine.
an NMHC standard of 0.19 g/kW § 1039.102 or in § 1039.101.
hr, a PM standard of 0.02 g/kW-hr,
and a CO standard of 3.5 g/kW-hr.
(b) Using engine offsets. (1) You may combination that totals 37,500 kW (4) For engines above 560 kW,
use engine offsets generated under engines. whether you use engines certified to the
paragraph (a) of this section to generate (2) You may decline to use the offsets. standards for generator-set engines.
additional allowances under § 1039.625, If you decline, the engine manufacturer (e) In-use fuel. If the engine
as follows: may use the provisions of manufacturer certifies using ultra low-
(i) For each engine offset, you may § 1039.104(a)(1). sulfur diesel fuel, you must take steps
increase the number of available (c) Limitation on offsets for engines to ensure that the in-use engines in the
allowances under § 1039.625(b) for that above 560 kW. For engines above 560 family will use diesel fuel with a sulfur
power category by one engine for the kW, you must track how many engines concentration no greater than 15 ppm.
years indicated. you install in generator sets and how For example, selling equipment only
many you install in other applications into applications where the operator
(ii) For engines in 56–560 kW power commits to a central-fueling facility
under the provisions of this section.
categories, you may transfer engine with ultra low-sulfur diesel fuel
Offsets from generator-set engines may
offsets across power categories within throughout its lifetime would meet this
be used only for generator-set engines.
this power range. Calculate the number requirement.
Offsets from engines for other
of additional allowances by scaling the
applications may be used only for other § 1039.630 What are the economic
number of generated engine offsets applications besides generator sets.
according to the ratio of engine power hardship provisions for equipment
for offset and allowance engines. Make (d) Reporting. When you submit your manufacturers?
this calculation for all your offset first annual report under § 1039.625(g), If you qualify for the economic
engines for which you will transfer include the following additional hardship provisions specified in 40 CFR
offsets under this paragraph (b)(1)(ii), information related to the engines you 1068.255, we may approve your
then round the result to determine the use to generate offsets under this hardship application subject to the
section: following additional conditions:
total number of available power-
weighted allowances. For example, if (1) The name of each engine family (a) You must show that you have used
you generate engine offsets for 75 500- involved. up the allowances to produce
kW engines, you may generate up to (2) The number of engines from each equipment with exempted engines
37,500 kW-engines of power-weighted power category. under § 1039.625.
allowances. You may apply this to 375 (3) The maximum engine power of (b) You may produce equipment
100-kW engines or any other each engine. under this section for up to 12 months
total (or 24 months total for small- obligates that company to take the units (TRUs). The operating restrictions
volume manufacturers). following steps: and characteristics in paragraph (f) of
(1) Meet the emission warranty this section define engines that are not
§ 1039.635 What are the hardship requirements that apply under used in TRUs. All provisions of this part
provisions for engine manufacturers?
§ 1039.120. This may involve a separate apply for TRU engines, except as
If you qualify for the hardship agreement involving reimbursement of specified in this section.
provisions specified in 40 CFR warranty-related expenses. (a) You may certify engines under this
1068.245, we may approve a period of (2) Report all warranty-related section with the following special
delayed compliance for up to one model information to the certificate holder. provisions:
year total (or two model years total for (b) In your application for (1) The engines are not subject to the
small-volume manufacturers). If you certification, identify the company transient emission standards of subpart
qualify for the hardship provisions whose trademark you will use and B of this part.
specified in 40 CFR 1068.250 for small- describe the arrangements you have (2) The steady-state emission
volume manufacturers, we may approve made to meet your requirements under standards in subpart B of this part apply
a period of delayed compliance for up this section. for emissions measured over the steady-
to two model years total. (c) You remain responsible for state test cycle described in paragraph
meeting all the requirements of this (b) of this section instead of the
§ 1039.640 What special provisions apply
to branded engines? chapter, including warranty and defect- otherwise applicable duty cycle
reporting provisions. described in § 1039.505.
The following provisions apply if you
identify the name and trademark of § 1039.645 What special provisions apply (b) Measure steady-state emissions
another company instead of your own to engines used for transportation using the procedures specified in
on your emission control information refrigeration units? § 1039.505, except for the duty cycles,
label, as provided by § 1039.135(c)(2): Manufacturers may choose to use the as follows:
(a) You must have a contractual provisions of this section for engines (1) The following duty cycle applies
agreement with the other company that used in transportation refrigeration for discrete-mode testing:
TABLE 1 OF § 1039.645.—D ISCRETE-MODE CYCLE FOR TRU ENGINES

Observed Weighting
Mode number Engine speed 1 torque 2 factors
1 ........................ Maximum test speed ........................................................................................................................ 75 0.25

2 ........................ Maximum test speed ........................................................................................................................ 50 0.25
3 ........................ Intermediate test speed ................................................................................................................... 75 0.25
4 ........................ Intermediate test speed ................................................................................................................... 50 0.25
1 Speed terms are defined in 40 CFR part 1065.
2 The percent torque is relative to the maximum torque at the given engine speed.
(2) The following duty cycle applies

for ramped-modal testing:
TABLE 2 OF § 1039.645.—R AMPED-MODAL CYCLE FOR TRU ENGINES

RMC Time in mode Torque
Engine speed 1
mode (seconds) (percent) 2 3
1a Steady-state ........................................................ 290 Intermediate Speed ................................................. 75.

1b Transition ............................................................ 20 Intermediate Speed ................................................. Linear Transition.
2a Steady-state ........................................................ 280 Intermediate Speed ................................................. 50.
2b Transition ............................................................ 20 Linear Transition ...................................................... Linear Transition.
3a Steady-state ........................................................ 280 Maximum Test Speed ............................................. 75.
3b Transition ............................................................ 20 Maximum Test Speed ............................................. Linear Transition.
4 Steady-state .......................................................... 290 Maximum Test Speed ............................................. 50
1 Speedterms are defined in 40 CFR part 1065.
2 The
percent torque is relative to the maximum torque at the commanded engine speed.
3 Advance from one mode to the next within a 20-second transition phase. During the transition phase, command a linear progression from the
torque setting of the current mode to the torque setting of the next mode, and simultaneously command a similar linear progression for engine
speed if there is a change in speed setting.
(c) Engines certified under this UNITS. INSTALLING OR USING THIS (3) Keep records to document the
section must be certified in a separate ENGINE IN ANY OTHER destinations and quantities of engines
engine family that contains only TRU APPLICATION MAY BE A VIOLATION produced under this section.
engines. OF FEDERAL LAW SUBJECT TO CIVIL (e) All engines certified under this
(d) You must do the following for PENALTY.’’. section must comply with NTE
each engine certified under this section: (2) State in the emission-related standards, as described in § 1039.101 or
(1) State on the emission control installation instructions all steps § 1039.102 for the applicable model
information label: ‘‘THIS ENGINE IS necessary to ensure that the engine will year, except that the NTE standards are
CERTIFIED TO OPERATE ONLY IN operate only in the modes covered by not limited with respect to operating
TRANSPORTATION REFRIGERATION the test cycle described in this section. speeds and loads. In your application
for certification, certify that all the (b) If you introduce an engine into (4) Buyer means the entity that
engines in the engine family comply commerce in the United States under receives emission credits as a result of
with the not-to-exceed emission this section, you must meet the labeling a trade.
standards for all normal operation and requirements in 40 CFR 89.110, but add (5) Reserved emission credits means
use. The deficiency provisions of the following statement instead of the emission credits you have generated
§ 1039.104(d) do not apply to these compliance statement in 40 CFR that we have not yet verified by
engines. This paragraph (e) applies 89.110(b)(10): reviewing your final report.
whether or not the engine would THIS ENGINE DOES NOT COMPLY WITH
(6) Seller means the entity that
otherwise be subject to NTE standards. U.S. EPA TIER 4 EMISSION provides emission credits during a
(f) An engine is not considered to be REQUIREMENTS. IMPORTING THIS trade.
used in a TRU if any of the following ENGINE INTO THE UNITED STATES OR (7) Standard means the emission
is true: ANY TERRITORY OF THE UNITED STATES standard that applies under subpart B of
(1) The engine is installed in any EXCEPT GUAM, AMERICAN SAMOA, OR this part for engines not participating in
equipment other than refrigeration units THE COMMONWEALTH OF THE the ABT program of this subpart.
NORTHERN MARIANA ISLANDS MAY BE (8) Trade means to exchange emission
for railcars, truck trailers, or other
A VIOLATION OF FEDERAL LAW SUBJECT credits, either as a buyer or seller.
freight vehicles. TO CIVIL PENALTY.
(2) The engine operates in any mode (d) You may not use emission credits
not covered by the test cycle described (c) Introducing into commerce an generated under this subpart to offset
in this section, except as follows: engine exempted under this section in any emissions that exceed an FEL or
(i) The engine may operate briefly at any state or territory of the United States standard. This applies for all testing,
idle. Note, however, that TRU engines other than Guam, American Samoa, or including certification testing, in-use
must meet NTE emission standards the Commonwealth of the Northern testing, selective enforcement audits,
under any type of operation, including Mariana Islands, throughout its lifetime, and other production-line testing.
idle, as described in paragraph (e) of violates the prohibitions in 40 CFR However, if emissions from an engine
this section. 1068.101(a)(1), unless it is exempt exceed an FEL or standard (for example,
(ii) The engine may have a minimal under a different provision. during a selective enforcement audit),
amount of transitional operation you may use emission credits to
§ 1039.660 What special provisions apply recertify the engine family with a higher
between two allowable modes. As an to Independent Commercial Importers?
example, a thirty-second transition FEL that applies only to future
period would clearly not be considered Under § 1039.801, certain engines are production.
minimal. considered to be new engines when they (e) Engine families that use emission
(iii) The engine as installed may are imported into the United States, credits for one or more pollutants may
experience up to a 2-percent decrease in even if they have previously been used not generate positive emission credits
load at a given setpoint over any 10- outside the country. Independent for another pollutant.
minute period, and up to a 15-percent Commercial Importers may use the (f) Emission credits may be used in
decrease in load at a given setpoint over provisions of 40 CFR part 89, subpart G, the model year they are generated or in
any 60-minute period. and 40 CFR 89.906(b) to receive a future model years. Emission credits
(3) The engine is sold in a certificate of conformity for engines may not be used for past model years.
configuration that allows the engine to meeting all the requirements of this part (g) You may increase or decrease an
operate in any mode not covered by the 1039. FEL during the model year by amending
test cycle described in this section. For your application for certification under
Subpart H—Averaging, Banking, and § 1039.225. The new FEL may apply
example, this section does not apply to
Trading for Certification only to engines you have not already
an engine sold without a governor
limiting operation only to those modes introduced into commerce. Each
§ 1039.701 General provisions.
covered by the test cycle described in engine’s emission control information
(a) You may average, bank, and trade label must include the applicable FELs.
this section.
(ABT) emission credits for purposes of
(4) The engine is subject to Tier 3 or certification as described in this subpart § 1039.705 How do I generate and
earlier standards, or phase-out Tier 4 to show compliance with the standards calculate emission credits?
standards. of this part. Participation in this The provisions of this section apply
§ 1039.650 [Reserved] program is voluntary. separately for calculating emission
(b) Section 1039.740 restricts the use credits for NOX, NOX+NMHC, or PM.
§ 1039.655 What special provisions apply of emission credits to certain averaging (a) Calculate positive emission credits
to engines sold in Guam, American Samoa,
sets. for an engine family that has an FEL
or the Commonwealth of the Northern below the otherwise applicable
Mariana Islands? (c) The definitions of Subpart I of this standard. Calculate negative emission
(a) The prohibitions in part apply to this subpart. The following credits for an engine family that has an
§ 1068.101(a)(1) do not apply to an definitions also apply: FEL above the otherwise applicable
engine if the following conditions are (1) Actual emission credits means standard.
met: emission credits you have generated (b) For each participating engine
(1) The engine is intended for use and that we have verified by reviewing your family, calculate positive or negative
will be used in Guam, American Samoa, final report. emission credits relative to the
or the Commonwealth of the Northern (2) Averaging set means a set of otherwise applicable emission standard.
Mariana Islands. engines in which emission credits may Round calculated emission credits to
(2) The engine meets the latest be exchanged only with other engines in the nearest kilogram (kg), using
applicable emission standards in 40 the same averaging set. consistent units throughout the
CFR 89.112. (3) Broker means any entity that following equation:Ä
(3) You meet all the requirements of facilitates a trade of emission credits Emission credits (kg) = (Std ¥ FEL) ×
§ 1039.260. between a buyer and seller. (Volume) × (AvgPR) × (UL) × (10¥3)

Where: emission credits in the same model declare the FELs you select for the
Std = the emission standard, in grams per year, from emission credits you have engine family for each pollutant for
kilowatt-hour, that applies under subpart banked, or from emission credits you which you are using the ABT program.
B of this part for engines not obtain through trading. Your FELs must comply with the
participating in the ABT program of this specifications of subpart B of this part,
subpart (the ‘‘otherwise applicable § 1039.715 How do I bank emission
standard’’). credits?
including the FEL caps. FELs must be
FEL = the family emission limit for the expressed to the same number of
(a) Banking is the retention of decimal places as the applicable
engine family, in grams per kilowatt- emission credits by the manufacturer
hour. standards.
generating the emission credits for use
Volume = the number of engines eligible to (b) Include the following in your
participate in the averaging, banking, in averaging or trading in future model
application for certification:
and trading program within the given years. You may use banked emission
credits only within the averaging set in (1) A statement that, to the best of
engine family during the model year, as
which they were generated. your belief, you will not have a negative
described in paragraph (c) of this section.
AvgPR = the average maximum engine power (b) In your application for balance of emission credits for any
of all the engine configurations within an certification, designate any emission averaging set when all emission credits
engine family, calculated on a sales- credits you intend to bank. These are calculated at the end of the year.
weighted basis, in kilowatts. emission credits will be considered (2) Detailed calculations of projected
UL = the useful life for the given engine reserved credits. During the model year emission credits (positive or negative)
family, in hours. and before the due date for the final based on projected production volumes.
(c) In your application for report, you may redesignate these If your engine family will generate
certification, base your showing of emission credits for averaging or positive emission credits, state
compliance on projected production trading. specifically where the emission credits
volumes for engines whose point of first (c) You may use banked emission will be applied (for example, to which
retail sale is in the United States. As credits from the previous model year for engine family they will be applied in
described in § 1039.730, compliance averaging or trading before we verify averaging, whether they will be traded,
with the requirements of this subpart is them, but we may revoke these emission or whether they will be reserved for
determined at the end of the model year credits if we are unable to verify them banking). If you have projected negative
based on actual production volumes for after reviewing your reports or auditing emission credits for an engine family,
engines whose point of first retail sale your records. state the source of positive emission
is in the United States. Do not include (d) Reserved credits become actual credits to offset the negative emission
any of the following engines to calculate emission credits only when we verify credits. Describe whether the emission
emission credits: them in reviewing your final report. credits are actual or reserved and
(1) Engines exempted under subpart G whether they will come from averaging,
of this part or under 40 CFR part 1068. § 1039.720 How do I trade emission
credits?
banking, trading, or a combination of
(2) Exported engines. these. Identify from which of your
(3) Engines not subject to the (a) Trading is the exchange of engine families or from which
requirements of this part, such as those emission credits between manufacturer the emission credits will
excluded under § 1039.5. manufacturers. You may use traded come.
(4) [Reserved] emission credits for averaging, banking,
(5) Any other engines, where we or further trading transactions. Traded § 1039.730 What ABT reports must I send
indicate elsewhere in this part 1039 that emission credits may be used only to EPA?
they are not to be included in the within the averaging set in which they (a) If any of your engine families are
calculations of this subpart. were generated. certified using the ABT provisions of
(b) You may trade actual emission this subpart, you must send an end-of-
§ 1039.710 How do I average emission credits as described in this subpart. You
credits? year report within 90 days after the end
may also trade reserved emission of the model year and a final report
(a) Averaging is the exchange of credits, but we may revoke these
emission credits among your engine within 270 days after the end of the
emission credits based on our review of model year. We may waive the
families. You may average emission your records or reports or those of the
credits only within the same averaging requirement to send the end-of year
company with which you traded report, as long as you send the final
set. emission credits.
(b) You may certify one or more report on time.
(c) If a negative emission credit (b) Your end-of-year and final reports
engine families to an FEL above the balance results from a transaction, both
applicable standard, subject to the FEL must include the following information
the buyer and seller are liable, except in for each engine family participating in
caps and other provisions in subpart B cases we deem to involve fraud. See
of this part, if you show in your the ABT program:
§ 1039.255(e) for cases involving fraud.
application for certification that your (1) Engine-family designation.
We may void the certificates of all
projected balance of all emission-credit (2) The emission standards that would
engine families participating in a trade
transactions in that model year is greater otherwise apply to the engine family.
that results in a manufacturer having a
than or equal to zero. negative balance of emission credits. (3) The FEL for each pollutant. If you
(c) If you certify an engine family to See § 1039.745. changed an FEL during the model year,
an FEL that exceeds the otherwise identify each FEL you used and
applicable standard, you must obtain § 1039.725 What must I include in my calculate the positive or negative
enough emission credits to offset the application for certification? emission credits under each FEL. Also,
engine family’s deficit by the due date (a) You must declare in your describe how the applicable FEL can be
for the final report required in application for certification your intent identified for each engine you
§ 1039.730. The emission credits used to to use the provisions of this subpart for produced. For example, you might keep
address the deficit may come from your each engine family that will be certified a list of engine identification numbers
other engine families that generate using the ABT program. You must also that correspond with certain FEL values.
(4) The projected and actual (i) The corporate names of the seller section. We may review your records at
production volumes for the model year and any brokers. any time.
with a point of retail sale in the United (ii) A copy of any contracts related to (b) Keep the records required by this
States. If you changed an FEL during the the trade. section for eight years after the due date
model year, identify the actual (iii) How you intend to use the for the end-of-year report. You may use
production volume associated with each emission credits, including the number any appropriate storage formats or
FEL. of emission credits you intend to apply media, including paper, microfilm, or
(5) Maximum engine power for each to each engine family (if known). computer diskettes.
engine configuration, and the sales- (c) Keep a copy of the reports we
(e) Send your reports electronically to
weighted average engine power for the require in § 1039.725 and § 1039.730.
the Designated Compliance Officer
engine family. (d) Keep the following additional
(6) Useful life. using an approved information format.
(7) Calculated positive or negative If you want to use a different format, records for each engine you produce
emission credits for the whole engine send us a written request with that generates or uses emission credits
family. Identify any emission credits justification for a waiver. under the ABT program:
that you traded, as described in (f) Correct errors in your end-of-year (1) Engine family designation.
paragraph (d)(1) of this section. report or final report as follows: (2) Engine identification number.
(c) Your end-of-year and final reports (1) You may correct any errors in your (3) FEL and useful life.
must include the following additional end-of-year report when you prepare the (4) Maximum engine power.
information: final report, as long as you send us the (5) Build date and assembly plant.
(1) Show that your net balance of final report by the time it is due. (6) Purchaser and destination.
emission credits from all your engine (2) If you or we determine within 270 (e) We may require you to keep
families in each averaging set in the days after the end of the model year that additional records or to send us relevant
applicable model year is not negative. errors mistakenly decrease your balance information not required by this section.
(2) State whether you will reserve any of emission credits, you may correct the
emission credits for banking. errors and recalculate the balance of § 1039.740 What restrictions apply for
(3) State that the report’s contents are using emission credits?
emission credits. You may not make
accurate. The following restrictions apply for
these corrections for errors that are
(d) If you trade emission credits, you using emission credits:
must send us a report within 90 days determined more than 270 days after the
end of the model year. If you report a (a) Averaging sets. Emission credits
after the transaction, as follows:
(1) As the seller, you must include the negative balance of emission credits, we may be exchanged only within an
following information in your report: may disallow corrections under this averaging set. For Tier 4 engines, there
(i) The corporate names of the buyer paragraph (f)(2). are two averaging sets—one for engines
and any brokers. (3) If you or we determine anytime at or below 560 kW and another for
(ii) A copy of any contracts related to that errors mistakenly increase your engines above 560 kW.
the trade. balance of emission credits, you must (b) Emission credits from earlier tiers
(iii) The engine families that correct the errors and recalculate the of standards. (1) For purposes of ABT
generated emission credits for the trade, balance of emission credits. under this subpart, you may not use
including the number of emission emission credits generated from engines
credits from each family. § 1039.735 What records must I keep? subject to emission standards under 40
(2) As the buyer, you must include the (a) You must organize and maintain CFR part 89, except as specified in
following information in your report: your records as described in this § 1039.102(d)(1) or the following table:
Then you
may use
those banked
And it was certified to the following standards under 40 CFR
If the maximum power of the credit-generating engine is . . . credits for the
part 89 . . . following Tier
4 engines
. . .
(i) kW < 19 ................................................................................... Tier 2 ........................................................................................... kW < 19

(ii) 19 ≤ kW < 37 .......................................................................... Tier 2 ........................................................................................... kW ≥ 19
(iii) 37 ≤ kW ≤ 560 ....................................................................... Tier 3 ........................................................................................... kW ≥ 19
(iv) kW > 560 ............................................................................... Tier 2 ........................................................................................... kW ≥ 19
(2) Emission credits generated from emission credits to show compliance § 1039.745 What can happen if I do not
marine engines certified under the with NOX standards, but you must comply with the provisions of this subpart?
provisions of 40 CFR part 89 may not be adjust the NOX+NMHC emission credits (a) For each engine family
used under this part. downward by twenty percent when you participating in the ABT program, the
(3) See 40 CFR part 89 for other use them, as shown in the following certificate of conformity is conditional
restrictions that may apply for using equation:
upon full compliance with the
emission credits generated under that NOX emission credits = (0.8) × (NOX+NMHC provisions of this subpart during and
part. emission credits). after the model year. You are
(c) NOX and NOX+NMHC emission
credits. You may use NOX emission (d) Other restrictions. Other sections responsible to establish to our
credits without adjustment to show of this part specify additional satisfaction that you fully comply with
compliance with NOX+NMHC restrictions for using emission credits applicable requirements. We may void
standards. You may use NOX+NMHC under certain special provisions. the certificate of conformity for an
engine family if you fail to comply with the operation of any part of the (2) Any other component whose
any provisions of this subpart. emission-control system. primary purpose is to reduce emissions.
(b) You may certify your engine Brake power means the usable power Designated Compliance Officer means
family to an FEL above an applicable output of the engine, not including the Manager, Engine Programs Group
standard based on a projection that you power required to fuel, lubricate, heat, (6405–J), U.S. Environmental Protection
will have enough emission credits to or cool the engine or to operate Agency, 1200 Pennsylvania Ave., NW.,
offset the deficit for the engine family. aftertreatment devices. Washington, DC 20460.
However, we may void the certificate of Calibration means the set of Designated Enforcement Officer
conformity if you cannot show in your specifications and tolerances specific to means the Director, Air Enforcement
final report that you have enough actual a particular design, version, or Division (2242A), U.S. Environmental
emission credits to offset a deficit for application of a component or assembly Protection Agency, 1200 Pennsylvania
any pollutant in an engine family. capable of functionally describing its Ave., NW.,Washington, DC 20460.
(c) We may void the certificate of operation over its working range. Deteriorated emission level means the
conformity for an engine family if you Certification means obtaining a emission level that results from
fail to keep records, send reports, or give certificate of conformity for an engine applying the appropriate deterioration
us information we request. family that complies with the emission factor to the official emission result of
(d) You may ask for a hearing if we standards and requirements in this part. the emission-data engine.
void your certificate under this section Certified emission level means the Deterioration factor means the
(see § 1039.820). highest deteriorated emission level in an relationship between emissions at the
engine family for a given pollutant from end of useful life and emissions at the
Subpart I—Definitions and Other either transient or steady-state testing. low-hour test point, expressed in one of
Reference Information Compression-ignition means relating the following ways:
to a type of reciprocating, internal- (1) For multiplicative deterioration
§ 1039.801 What definitions apply to this
combustion engine that is not a spark- factors, the ratio of emissions at the end
part?
ignition engine. of useful life to emissions at the low-
The following definitions apply to hour test point.
this part. The definitions apply to all Constant-speed engine means an
(2) For additive deterioration factors,
subparts unless we note otherwise. All engine whose certification is limited to
the difference between emissions at the
undefined terms have the meaning the constant-speed operation. Engines
end of useful life and emissions at the
Act gives to them. The definitions whose constant-speed governor function
low-hour test point.
follow: is removed or disabled are no longer
Discrete-mode means relating to the
Act means the Clean Air Act, as constant-speed engines.
discrete-mode type of steady-state test
amended, 42 U.S.C. 7401–7671q. Constant-speed operation means
described in § 1039.505.
Adjustable parameter means any engine operation with a governor that Emission-control system means any
device, system, or element of design that controls engine speed to a reference device, system, or element of design that
someone can adjust (including those speed. There are two kinds of constant- controls or reduces the regulated
which are difficult to access) and that, speed governors. An isochronous emissions from an engine.
if adjusted, may affect emissions or governor changes reference speed Emission-data engine means an
engine performance during emission temporarily during a load change, then engine that is tested for certification.
testing or normal in-use operation. This returns it to the original reference speed This includes engines tested to establish
includes, but is not limited to, after the engine stabilizes. Isochronous deterioration factors.
parameters related to injection timing governors typically allow speed changes Emission-related maintenance means
and fueling rate. You may ask us to up to 1.0 percent. A speed-droop maintenance that substantially affects
exclude a parameter that is difficult to governor has a fixed reference speed at emissions or is likely to substantially
access if it cannot be adjusted to affect zero load and allows the reference speed affect emission deterioration.
emissions without significantly to decrease as load increases. With Engine configuration means a unique
degrading engine performance, or if you speed-droop governors, speed typically combination of engine hardware and
otherwise show us that it will not be decreases 3 to 10 percent below the calibration within an engine family.
adjusted in a way that affects emissions reference speed at zero load, such that Engines within a single engine
during in-use operation. the minimum reference speed occurs configuration differ only with respect to
Aftertreatment means relating to a near the engine’s point of maximum normal production variability.
catalytic converter, particulate filter, or power. Engine family has the meaning given
any other system, component, or Crankcase emissions means airborne in § 1039.230.
technology mounted downstream of the substances emitted to the atmosphere Engine manufacturer means the
exhaust valve (or exhaust port) whose from any part of the engine crankcase’s manufacturer of the engine. See the
design function is to reduce emissions ventilation or lubrication systems. The definition of ‘‘manufacturer’’ in this
in the engine exhaust before it is crankcase is the housing for the section.
exhausted to the environment. Exhaust- crankshaft and other related internal Engine used in a locomotive means
gas recirculation (EGR) is not parts. either an engine placed in the
aftertreatment. Critical emission-related component locomotive to move other equipment,
Aircraft means any vehicle capable of means any of the following components: freight, or passenger traffic; or an engine
sustained air travel above treetop (1) Electronic control units, mounted on the locomotive to provide
heights. aftertreatment devices, fuel-metering auxiliary power.
Auxiliary emission-control device components, EGR-system components, Equipment manufacturer means a
means any element of design that senses crankcase-ventilation valves, all manufacturer of nonroad equipment. All
temperature, motive speed, engine RPM, components related to charge-air nonroad equipment manufacturing
transmission gear, or any other compression and cooling, and all entities under the control of the same
parameter for the purpose of activating, sensors and actuators associated with person are considered to be a single
modulating, delaying, or deactivating any of these components. nonroad equipment manufacturer.
(Note: In § 1039.626, the term Generator-set engine means an engine not include portable auxiliary engines
‘‘equipment manufacturer’’ has a used primarily to operate an electrical for which the fueling, cooling and
narrower meaning, which applies only generator or alternator to produce exhaust systems are not integral parts of
to that section.) electric power for other applications. the vessel. There are two kinds of
Excluded means relating to an engine Good engineering judgment means marine engines:
that either: judgments made consistent with (1) Propulsion marine engine means a
(1) Has been determined not to be a generally accepted scientific and marine engine that moves a vessel
nonroad engine, as specified in 40 CFR engineering principles and all available through the water or directs the vessel’s
1068.30; or relevant information. See 40 CFR 1068.5 movement.
(2) Is a nonroad engine that, according for the administrative process we use to (2) Auxiliary marine engine means a
to § 1039.5, is not subject to this part evaluate good engineering judgment. marine engine not used for propulsion.
1039. High-sulfur diesel fuel means one of Marine vessel has the meaning given
the following: in 1 U.S.C. 3, which generally includes
Exempted means relating to an engine
(1) For in-use fuels, high-sulfur diesel all nonroad equipment used as a means
that is not required to meet otherwise
fuel means a diesel fuel with a of transportation on water.
applicable standards. Exempted engines Maximum engine power has the
must conform to regulatory conditions maximum sulfur concentration greater
than 500 parts per million. meaning given in § 1039.140. Note that
specified for an exemption in this part § 1039.230 generally disallows grouping
1039 or in 40 CFR part 1068. Exempted (2) For testing, high-sulfur diesel fuel
has the meaning we give in 40 CFR part engines from different power categories
engines are deemed to be ‘‘subject to’’ in the same engine family.
the standards of this part, even though 1065.
Hydrocarbon (HC) means the Maximum test speed has the meaning
they are not required to comply with the we give in 40 CFR 1065.515.
otherwise applicable requirements. hydrocarbon group on which the
emission standards are based for each Maximum test torque has the meaning
Engines exempted with respect to a we give in 40 CFR 1065.1001.
certain tier of standards may be required fuel type. For alcohol-fueled engines,
HC means total hydrocarbon equivalent Model year means one of the
to comply with an earlier tier of following things:
standards as a condition of the (THCE). For all other engines, HC means
(1) For freshly manufactured
exemption; for example, engines nonmethane hydrocarbon (NMHC).
equipment and engines (see definition
Identification number means a unique
exempted with respect to Tier 4 of ‘‘new nonroad engine,’’ paragraph
specification (for example, a model
standards may be required to comply (1)), model year means one of the
number/serial number combination)
with Tier 3 standards. following:
that allows someone to distinguish a (i) Calendar year.
Exhaust-gas recirculation means a
particular engine from other similar (ii) Your annual new model
technology that reduces emissions by
engines. production period if it is different than
routing exhaust gases that had been Intermediate test speed has the
exhausted from the combustion the calendar year. This must include
meaning we give in 40 CFR 1065.515. January 1 of the calendar year for which
chamber(s) back into the engine to be Low-hour means relating to an engine
mixed with incoming air before or the model year is named. It may not
with stabilized emissions and represents begin before January 2 of the previous
during combustion. The use of valve the undeteriorated emission level. This
timing to increase the amount of calendar year and it must end by
would generally involve less than 300 December 31 of the named calendar
residual exhaust gas in the combustion hours of operation.
chamber(s) that is mixed with incoming year.
Low-sulfur diesel fuel means one of (2) For an engine that is converted to
air before or during combustion is not the following:
considered exhaust-gas recirculation for a nonroad engine after being placed into
(1) For in-use fuels, low-sulfur diesel service as a motor-vehicle engine or a
the purposes of this part. fuel means a diesel fuel with a
Family emission limit (FEL) means an stationary engine, model year means the
maximum sulfur concentration of 500 calendar year in which the engine was
emission level declared by the parts per million.
manufacturer to serve in place of an originally produced (see definition of
(2) For testing, low-sulfur diesel fuel ‘‘new nonroad engine,’’ paragraph (2)).
otherwise applicable emission standard has the meaning we give in 40 CFR part (3) For a nonroad engine excluded
under the ABT program in subpart H of 1065. under § 1039.5 that is later converted to
this part. The family emission limit Manufacture means the physical and operate in an application that is not
must be expressed to the same number engineering process of designing, excluded, model year means the
of decimal places as the emission constructing, and assembling a nonroad calendar year in which the engine was
standard it replaces. The family engine or a piece of nonroad equipment. originally produced (see definition of
emission limit serves as the emission Manufacturer has the meaning given ‘‘new nonroad engine,’’ paragraph (3)).
standard for the engine family with in section 216(1) of the Act. In general, (4) For engines that are not freshly
respect to all required testing. this term includes any person who manufactured but are installed in new
Fuel system means all components manufactures an engine, vehicle, or nonroad equipment, model year means
involved in transporting, metering, and piece of equipment for sale in the the calendar year in which the engine is
mixing the fuel from the fuel tank to the United States or otherwise introduces a installed in the new nonroad equipment
combustion chamber(s), including the new nonroad engine into commerce in (see definition of ‘‘new nonroad
fuel tank, fuel tank cap, fuel pump, fuel the United States. This includes engine,’’ paragraph (4)).
filters, fuel lines, carburetor or fuel- importers who import engines, (5) For imported engines:
injection components, and all fuel- equipment, or vehicles for resale. (Note: (i) For imported engines described in
system vents. In § 1039.626, the term ‘‘equipment paragraph (5)(i) of the definition of
Fuel type means a general category of manufacturer’’ has a narrower meaning, ‘‘new nonroad engine,’’ model year has
fuels such as diesel fuel or natural gas. which applies only to that section.) the meaning given in paragraphs (1)
There can be multiple grades within a Marine engine means a nonroad through (4) of this definition.
single fuel type, such as high-sulfur or engine that someone installs or intends (ii) For imported engines described in
low-sulfur diesel fuel. to install on a marine vessel. This does paragraph (5)(ii) of the definition of
‘‘new nonroad engine,’’ model year has is imported. It is no longer new when Nonmethane hydrocarbon means the
the meaning given in 40 CFR 89.602 for the ultimate purchaser receives a title difference between the emitted mass of
independent commercial importers. for the engine or it is placed into total hydrocarbons and the emitted mass
Motor vehicle has the meaning we service, whichever comes first. of methane.
give in 40 CFR 85.1703(a). In general, (iii) An imported nonroad engine that Nonroad means relating to nonroad
motor vehicle means any vehicle that is not covered by a certificate of engines or equipment that includes
EPA deems to be capable of safe and conformity issued under this part at the nonroad engines.
practical use on streets or highways. time of importation is new, but only if Nonroad engine has the meaning we
New nonroad engine means any of the it was produced on or after the dates give in 40 CFR 1068.30. In general this
following things: shown in the following table. This means all internal-combustion engines
(1) A freshly manufactured nonroad addresses uncertified engines and except motor vehicle engines, stationary
engine for which the ultimate purchaser equipment initially placed into service engines, engines used solely for
has never received the equitable or legal that someone seeks to import into the competition, or engines used in aircraft.
title. This kind of engine might United States. Importation of this kind This part does not apply to all nonroad
commonly be thought of as ‘‘brand of new nonroad engine (or equipment engines (see § 1039.5).
new.’’ In the case of this paragraph (1), containing such an engine) is generally Nonroad equipment means a piece of
the engine becomes new when it is fully prohibited by 40 CFR part 1068. equipment that is powered by one or
assembled for the first time. The engine more nonroad engines.
is no longer new when the ultimate APPLICABILITY OF EMISSION STAND Official emission result means the
purchaser receives the title or the ARDS FOR NONROAD DIESEL EN measured emission rate for an emission-
product is placed into service, GINES data engine on a given duty cycle before
whichever comes first. the application of any deterioration
(2) An engine originally manufactured
Maximum engine power Initial date of emis factor, but after the applicability of
as a motor-vehicle engine or a stationary sion standards
regeneration adjustment factors.
engine that is later intended to be used
kW < 19 ......................... January 1, 2000. Opacity means the fraction of a beam
in a piece of nonroad equipment. In this
19 ≤ kW < 37 ................ January 1, 1999. of light, expressed in percent, which
case, the engine is no longer a motor-
37 ≤ kW < 75 ................ January 1, 1998. fails to penetrate a plume of smoke, as
vehicle or stationary engine and 75 ≤ kW < 130 .............. January 1, 1997. measured by the procedure specified in
becomes a ‘‘new nonroad engine’’. The 130 ≤ kW ≤ 560 ............ January 1, 1996. § 1039.501.
engine is no longer new when it is kW > 560 ....................... January 1, 2000. Oxides of nitrogen has the meaning
placed into nonroad service.
(3) A nonroad engine that has been we give in 40 CFR part 1065.
New nonroad equipment means either
previously placed into service in an Particulate trap means a filtering
of the following things:
application we exclude under § 1039.5, (1) A nonroad piece of equipment for device that is designed to physically
where that engine is installed in a piece which the ultimate purchaser has never trap all particulate matter above a
of equipment that is covered by this part received the equitable or legal title. The certain size.
1039. The engine is no longer new when product is no longer new when the Piece of equipment means any
it is placed into nonroad service covered ultimate purchaser receives this title or vehicle, vessel, or other type of
by this part 1039. For example, this the product is placed into service, equipment using engines to which this
would apply to a marine diesel engine whichever comes first. part applies.
that is no longer used in a marine (2) An imported nonroad piece of Placed into service means put into
vessel. equipment with an engine not covered initial use for its intended purpose.
(4) An engine not covered by by a certificate of conformity issued Point of first retail sale means the
paragraphs (1) through (3) of this under this part at the time of location at which the initial retail sale
definition that is intended to be importation and manufactured after the occurs. This generally means an
installed in new nonroad equipment. requirements of this part start to apply equipment dealership, but may also
The engine is no longer new when the (see § 1039.1). include an engine seller or distributor in
ultimate purchaser receives a title for Noncommercial fuel means a cases where loose engines are sold to
the equipment or the product is placed combustible product that is not the general public for uses such as
into service, whichever comes first. This marketed as a commercial fuel, but is replacement engines.
generally includes installation of used used as a fuel for nonroad engines. For Power category means a specific range
engines in new equipment. example, this includes methane that is of maximum engine power that defines
(5) An imported nonroad engine, produced and released from landfills or the applicability of standards. For
subject to the following provisions: oil wells, or similar unprocessed fuels example, references to the 56–130 kW
(i) An imported nonroad engine that are not intended to meet any power category and 56 ≤ kW
covered by a certificate of conformity otherwise applicable fuel specifications. < 130 include all engines with
issued under this part that meets the See § 1039.615 for provisions related to maximum engine power at or above 56
criteria of one or more of paragraphs (1) engines designed to burn kW but below 130 kW. Also references
through (4) of this definition, where the noncommercial fuels. to 56–560 kW power categories or 56 ≤
original engine manufacturer holds the Noncompliant engine means an kW ≤ 560 include all engines with
certificate, is new as defined by those engine that was originally covered by a maximum engine power at or above 56
applicable paragraphs. certificate of conformity, but is not in kW but at or below 560 kW, even
(ii) An imported nonroad engine the certified configuration or otherwise though these engines span multiple
covered by a certificate of conformity does not comply with the conditions of power categories. Note that in some
issued under this part, where someone the certificate. cases, FEL caps are based on a subset of
other than the original engine Nonconforming engine means an a power category. The power categories
manufacturer holds the certificate (such engine not covered by a certificate of are defined as follows:
as when the engine is modified after its conformity that would otherwise be (1) Engines with maximum power
initial assembly), becomes new when it subject to emission standards. below 19 kW.
(2) Engines with maximum power at tests are either discrete-mode tests or or new nonroad engine, the first person
or above 19 kW but below 56 kW. ramped-modal tests. who in good faith purchases such new
(3) Engines with maximum power at Sulfur-sensitive technology means an nonroad equipment or new nonroad
or above 56 kW but below 130 kW. emission-control technology that engine for purposes other than resale.
(4) Engines with maximum power at experiences a significant drop in Ultra low-sulfur diesel fuel means one
or above 130 kW but at or below 560 emission-control performance or of the following:
kW. emission-system durability when an (1) For in-use fuels, ultra low-sulfur
(5) Engines with maximum power engine is operated on low-sulfur fuel diesel fuel means a diesel fuel with a
above 560 kW. (i.e., fuel with a sulfur concentration of maximum sulfur concentration of 15
Ramped-modal means relating to the 300 to 500 ppm) as compared to when parts per million.
ramped-modal type of steady-state test it is operated on ultra low-sulfur fuel (2) For testing, ultra low-sulfur diesel
described in § 1039.505. (i.e., fuel with a sulfur concentration fuel has the meaning we give in 40 CFR
Rated speed means the maximum less than 15 ppm). Exhaust-gas part 1065.
full-load governed speed for governed recirculation is not a sulfur-sensitive United States means the States, the
engines and the speed of maximum technology. District of Columbia, the
power for ungoverned engines. Suspend means to temporarily Commonwealth of Puerto Rico, the
Revoke means to terminate the discontinue the certificate or an Commonwealth of the Northern Mariana
certificate or an exemption for an engine exemption for an engine family. If we Islands, Guam, American Samoa, and
family. If we revoke a certificate or suspend a certificate, you may not the U.S. Virgin Islands.
exemption, you must apply for a new introduce into commerce engines from Upcoming model year means for an
certificate or exemption before that engine family unless we reinstate engine family the model year after the
continuing to introduce the affected the certificate or approve a new one. If one currently in production.
engines into commerce. This does not we suspend an exemption, you may not U.S.-directed production volume
apply to engines you no longer possess. introduce into commerce engines that means the number of engine units,
Round means to round numbers were previously covered by the subject to the requirements of this part,
according to NIST Special Publication exemption unless we reinstate the produced by a manufacturer for which
811(incorporated by reference in exemption. the manufacturer has a reasonable
§ 1039.810), unless otherwise specified. Test engine means an engine in a test assurance that sale was or will be made
Scheduled maintenance means sample. to ultimate purchasers in the United
adjusting, repairing, removing, Test sample means the collection of States.
disassembling, cleaning, or replacing engines selected from the population of Useful life means the period during
components or systems periodically to an engine family for emission testing. which the engine is designed to
keep a part or system from failing, This may include testing for properly function in terms of reliability
malfunctioning, or wearing prematurely. certification, production-line testing, or and fuel consumption, without being
It also may mean actions you expect are in-use testing. remanufactured, specified as a number
necessary to correct an overt indication Tier 1 means relating to the Tier 1 of hours of operation or calendar years,
of failure or malfunction for which emission standards, as shown in 40 CFR whichever comes first. It is the period
periodic maintenance is not 89.112. during which a new nonroad engine is
appropriate. Tier 2 means relating to the Tier 2 required to comply with all applicable
Small-volume engine manufacturer emission standards, as shown in 40 CFR emission standards. See § 1039.101(g).
means a small business engine 89.112. Variable-speed engine means an
manufacturer that had engine families Tier 3 means relating to the Tier 3 engine that is not a constant-speed
certified to meet the requirements of 40 emission standards, as shown in 40 CFR engine.
CFR part 89 before 2003 (40 CFR part 89.112. Void means to invalidate a certificate
89, revised as of July 1, 2002), had Tier 4 means relating to the Tier 4 or an exemption ab initio. If we void a
annual U.S.-directed production of no emission standards, as shown in certificate, all the engines introduced
more than 2,500 units in 2002 and all § 1039.101 and § 1039.102. This into commerce under that engine family
earlier calendar years, and has 1000 or includes the emission standards that are for that model year are considered
fewer employees. For manufacturers shown in § 1039.101 and § 1039.102 that noncompliant, and you are liable for
owned by a parent company, the are unchanged from Tier 2 or Tier 3 each engine introduced into commerce
production limit applies to the emission standards. under the certificate and may face civil
production of the parent company and Total hydrocarbon means the or criminal penalties or both. This
all its subsidiaries and the employee combined mass of organic compounds applies equally to all engines in the
limit applies to the total number of measured by the specified procedure for engine family, including engines
employees of the parent company and measuring total hydrocarbon, expressed introduced into commerce before we
all its subsidiaries. as a hydrocarbon with a hydrogen-to- voided the certificate. If we void an
Spark-ignition means relating to a carbon mass ratio of 1.85:1. exemption, all the engines introduced
gasoline-fueled engine or any other type Total hydrocarbon equivalent means into commerce under that exemption
of engine with a spark plug (or other the sum of the carbon mass are considered uncertified (or
sparking device) and with operating contributions of non-oxygenated nonconforming), and you are liable for
characteristics significantly similar to hydrocarbons, alcohols and aldehydes, each engine introduced into commerce
the theoretical Otto combustion cycle. or other organic compounds that are under the exemption and may face civil
Spark-ignition engines usually use a measured separately as contained in a or criminal penalties or both. You may
throttle to regulate intake air flow to gas sample, expressed as exhaust not introduce into commerce any
control power during normal operation. hydrocarbon from petroleum-fueled additional engines using the voided
Steady-state means relating to engines. The hydrogen-to-carbon ratio of exemption.
emission tests in which engine speed the equivalent hydrocarbon is 1.85:1. Volatile liquid fuel means any fuel
and load are held at a finite set of Ultimate purchaser means, with other than diesel or biodiesel that is a
essentially constant values. Steady-state respect to any new nonroad equipment liquid at atmospheric pressure and has
a Reid Vapor Pressure higher than 2.0 (a) NIST material. Table 1 of this § 1039.815 What provisions apply to
pounds per square inch. section lists material from the National confidential information?
We (us, our) means the Administrator Institute of Standards and Technology (a) Clearly show what you consider
of the Environmental Protection Agency that we have incorporated by reference. confidential by marking, circling,
and any authorized representatives. The first column lists the number and bracketing, stamping, or some other
§ 1039.805 What symbols, acronyms, and
name of the material. The second method.
abbreviations does this part use? column lists the sections of this part
where we reference it. Anyone may (b) We will store your confidential
The following symbols, acronyms, information as described in 40 CFR part
and abbreviations apply to this part: purchase copies of these materials from
the Government Printing Office, 2. Also, we will disclose it only as
CFR Code of Federal Regulations. Ä Washington, DC 20402 or download specified in 40 CFR part 2. This applies
CO carbon monoxide. Ä them from the Internet at http:// both to any information you send us and
CO2 carbon dioxide. Ä to any information we collect from
EPA Environmental Protection Agency. Ä physics.nist.gov/Pubs/SP811/. Table 1
FEL Family Emission Limit. Ä follows: inspections, audits, or other site visits.
g/kW-hr grams per kilowatt-hour. Ä (c) If you send us a second copy
HC hydrocarbon. Ä TABLE 1 OF § 1039.810.—NIST without the confidential information,
kW kilowatts. Ä MATERIALS we will assume it contains nothing
NIST National Institute of Standards and Ä
confidential whenever we need to
Technology.
NMHC nonmethane hydrocarbons. Document number and name Part 1039 release information from it.
reference
NOX oxides of nitrogen (NO and NO2). (d) If you send us information without
NTE not-to-exceed claiming it is confidential, we may make
NIST Special Publication
PM particulate matter.
811, Guide for the Use of it available to the public without further
rpm revolutions per minute.
SAE Society of Automotive Engineers. the International System of notice to you, as described in 40 CFR
SEA Selective enforcement audit. Units (SI), 1995 Edition ..... 1039.801 2.204.
THC total hydrocarbon. Ä
THCE total hydrocarbon equivalent. Ä § 1039.820 How do I request a hearing?
(b) SAE material. Table 2 of this
TRU transportation refrigeration unit. Ä section lists material from the Society of (a) You may request a hearing under
U.S.C. United States Code.Ä
Automotive Engineering that we have certain circumstances, as described
§ 1039.810 What materials does this part incorporated by reference. The first elsewhere in this part. To do this, you
reference? column lists the number and name of must file a written request, including a
Documents listed in this section have the material. The second column lists description of your objection and any
been incorporated by reference into this the sections of this part where we supporting data, within 30 days after we
part. The Director of the Federal reference it. Anyone may purchase make a decision.
Register approved the incorporation by copies of these materials from the
(b) For a hearing you request under
reference as prescribed in 5 U.S.C. Society of Automotive Engineers, 400
the provisions of this part, we will
552(a) and 1 CFR part 51. Anyone may Commonwealth Drive, Warrendale, PA
approve your request if we find that
inspect copies at the U.S. EPA, Air and 15096. Table 2 follows:
your request raises a substantial factual
Radiation Docket and Information issue.
Center, 1301 Constitution Ave., NW., TABLE 2 OF § 1039.810.—SAE
Room B102, EPA West Building, MATERIALS (c) If we agree to hold a hearing, we
Washington, DC 20460 or at the will use the procedures specified in 40
National Archives and Records Part 1039 CFR part 1068, subpart G.
Document number and name
Administration (NARA). For reference
Appendix I to Part 1039—[Reserved]
information on the availability of this
material at NARA, call 202–741–6030, SAE J1930, Electrical/Elec Appendix II to Part 1039—Steady-State Duty
or go to: http://www.archives.gov/ tronic Systems Diagnostic Cycles for Constant-Speed Engines
Terms, Definitions, Abbre
federal_register/ viations, and Acronyms,
(a) The following duty cycle applies for
code_of_federal_regulations/ revised May 1998 ............. 1039.135 discrete-mode testing of constant-speed
ibr_locations.html. engines:
D2 mode Torque Weighting

Engine speed 1 (percent) 2
number factors
1 ........................ Maximum test speed ................................................................................................................ 100 0.05

1 Maximum test speed is defined in 40 CFR part 1065.
2 Except as noted in § 1039.505, the percent torque is relative to maximum test torque.
(b) The following duty cycle applies for

ramped-modal testing of constant-speed
engines:
Time in Torque
RMC mode mode Engine speed (percent) 1 2
(seconds)
1a Steady-state ........................................................ 53 Engine Governed ..................................................... 100.

1b Transition ............................................................ 20 Engine Governed ..................................................... Linear transition.
5 Steady-state .......................................................... 350 Engine Governed ..................................................... 50.
1 The
percent torque is relative to maximum test torque.
2 Advancefrom one mode to the next within a 20-second transition phase. During the transition phase, command a linear progression from the
torque setting of the current mode to the torque setting of the next mode.
Appendix III to Part 1039—Steady-State

Duty Cycles for Variable-Speed Engines With
Maximum Power Below 19 kW
discrete-mode testing of variable-speed
engines with maximum power below 19 kW:
Observed
G2 mode Weighting
Engine speed 1 torque
number (percent) 2 factors

6 ........................ Idle ............................................................................................................................................ 0 0.05
2 The percent torque is relative to the maximum torque at the commanded test speed.
(b) The following duty cycle applies for

ramped-modal testing of variable-speed
engines with maximum power below 19 kW:
Time in
RMC Torque
mode Engine speed 1 3
mode (percent) 2 3
(seconds)
1a Steady-state ....................................... 41 Warm Idle ................................................................................ 0.

1b Transition ............................................ 20 Linear transition ....................................................................... Linear transition.
2a Steady-state ....................................... 135 Maximum Test Speed .............................................................. 100.
2b Transition ............................................ 20 Maximum Test Speed .............................................................. Linear transition.
6b Transition ............................................ 20 Linear transition ....................................................................... Linear transition.
7 Steady-state ......................................... 43 Warm Idle ................................................................................ 0.
2 The
Appendix IV to Part 1039—Steady-State engines with maximum power at or above 19

Duty Cycles for Variable-Speed Engines With kW:
Maximum Power at or Above 19 kW
discrete-mode testing of variable-speed
Observed
C1 mode Weighting
Engine speed 1 torque
number factors
(percent) 2

5 ........................ Intermediate test speed ............................................................................................................ 100 0.10
8 ........................ Idle ............................................................................................................................................ 0 0.15
2 The percent torque is relative to the maximum torque at the commanded test speed.
(b) The following duty cycle applies for engines with maximum power at or above 19
ramped-modal testing of variable-speed kW:
Time in Engine Torque

RMC Mode mode speed 1 3 (percent) 2 3
(seconds)
1a Steady-state ....................................... 126 Warm Idle ................................................................................ 0.

1b Transition ............................................ 20 Linear Transition 2 .................................................................... Linear Transition.
2a Steady-state ....................................... 159 Intermediate Speed ................................................................. 100.
2b Transition ............................................ 20 Intermediate Speed ................................................................. Linear Transition.
3b Transition ............................................ 20 Intermediate Speed ................................................................. Linear Transition.
4b Transition ............................................ 20 Linear Transition ...................................................................... Linear Transition.
5b Transition ............................................ 20 Maximum Test Speed .............................................................. Linear Transition.
8b Transition ............................................ 20 Linear Transition ...................................................................... Linear Transition.
9 Steady-state ......................................... 128 Warm Idle ................................................................................ 0.
2 The
Appendix V to Part 1039 [Reserved] Normalized Normalized Normalized Normalized

Appendix VI to Part 1039—Nonroad Time(s) speed torque Time(s) speed torque
(percent) (percent) (percent) (percent)
Compression-ignition Composite Transient
Cycle
20 ...................... 0 0 44 ...................... 105 47
21 ...................... 0 0 45 ...................... 98 70
Normalized Normalized 22 ...................... 0 0 46 ...................... 104 36
Time(s) speed torque
(percent) (percent) 23 ...................... 0 0 47 ...................... 104 65
24 ...................... 1 3 48 ...................... 96 71
1 ........................ 0 0 25 ...................... 1 3 49 ...................... 101 62
2 ........................ 0 0 26 ...................... 1 3 50 ...................... 102 51
3 ........................ 0 0 27 ...................... 1 3 51 ...................... 102 50
4 ........................ 0 0 28 ...................... 1 3 52 ...................... 102 46
5 ........................ 0 0 29 ...................... 1 3 53 ...................... 102 41
6 ........................ 0 0 30 ...................... 1 6 54 ...................... 102 31
7 ........................ 0 0 31 ...................... 1 6 55 ...................... 89 2
8 ........................ 0 0 32 ...................... 2 1 56 ...................... 82 0
9 ........................ 0 0 33 ...................... 4 13 57 ...................... 47 1
10 ...................... 0 0 34 ...................... 7 18 58 ...................... 23 1
11 ...................... 0 0 35 ...................... 9 21 59 ...................... 1 3
12 ...................... 0 0 36 ...................... 17 20 60 ...................... 1 8
13 ...................... 0 0 37 ...................... 33 42 61 ...................... 1 3
14 ...................... 0 0 38 ...................... 57 46 62 ...................... 1 5
15 ...................... 0 0 39 ...................... 44 33 63 ...................... 1 6
16 ...................... 0 0 40 ...................... 31 0 64 ...................... 1 4
17 ...................... 0 0 41 ...................... 22 27 65 ...................... 1 4
18 ...................... 0 0 42 ...................... 33 43 66 ...................... 0 6
19 ...................... 0 0 43 ...................... 80 49 67 ...................... 1 4
Normalized Normalized Normalized Normalized Normalized Normalized

Time(s) speed torque Time(s) speed torque Time(s) speed torque
(percent) (percent) (percent) (percent) (percent) (percent)
68 ...................... 9 21 140 .................... 104 44 212 .................... 18 29

69 ...................... 25 56 141 .................... 103 44 213 .................... 14 51
70 ...................... 64 26 142 .................... 104 33 214 .................... 13 11
71 ...................... 60 31 143 .................... 102 27 215 .................... 12 9
72 ...................... 63 20 144 .................... 103 26 216 .................... 15 33
73 ...................... 62 24 145 .................... 79 53 217 .................... 20 25
74 ...................... 64 8 146 .................... 51 37 218 .................... 25 17
75 ...................... 58 44 147 .................... 24 23 219 .................... 31 29
76 ...................... 65 10 148 .................... 13 33 220 .................... 36 66
77 ...................... 65 12 149 .................... 19 55 221 .................... 66 40
78 ...................... 68 23 150 .................... 45 30 222 .................... 50 13
79 ...................... 69 30 151 .................... 34 7 223 .................... 16 24
80 ...................... 71 30 152 .................... 14 4 224 .................... 26 50
81 ...................... 74 15 153 .................... 8 16 225 .................... 64 23
82 ...................... 71 23 154 .................... 15 6 226 .................... 81 20
83 ...................... 73 20 155 .................... 39 47 227 .................... 83 11
84 ...................... 73 21 156 .................... 39 4 228 .................... 79 23
85 ...................... 73 19 157 .................... 35 26 229 .................... 76 31
86 ...................... 70 33 158 .................... 27 38 230 .................... 68 24
87 ...................... 70 34 159 .................... 43 40 231 .................... 59 33
88 ...................... 65 47 160 .................... 14 23 232 .................... 59 3
89 ...................... 66 47 161 .................... 10 10 233 .................... 25 7
90 ...................... 64 53 162 .................... 15 33 234 .................... 21 10
91 ...................... 65 45 163 .................... 35 72 235 .................... 20 19
92 ...................... 66 38 164 .................... 60 39 236 .................... 4 10
93 ...................... 67 49 165 .................... 55 31 237 .................... 5 7
94 ...................... 69 39 166 .................... 47 30 238 .................... 4 5
95 ...................... 69 39 167 .................... 16 7 239 .................... 4 6
96 ...................... 66 42 168 .................... 0 6 240 .................... 4 6
97 ...................... 71 29 169 .................... 0 8 241 .................... 4 5
98 ...................... 75 29 170 .................... 0 8 242 .................... 7 5
99 ...................... 72 23 171 .................... 0 2 243 .................... 16 28
100 .................... 74 22 172 .................... 2 17 244 .................... 28 25
101 .................... 75 24 173 .................... 10 28 245 .................... 52 53
102 .................... 73 30 174 .................... 28 31 246 .................... 50 8
103 .................... 74 24 175 .................... 33 30 247 .................... 26 40
104 .................... 77 6 176 .................... 36 0 248 .................... 48 29
105 .................... 76 12 177 .................... 19 10 249 .................... 54 39
106 .................... 74 39 178 .................... 1 18 250 .................... 60 42
107 .................... 72 30 179 .................... 0 16 251 .................... 48 18
108 .................... 75 22 180 .................... 1 3 252 .................... 54 51
109 .................... 78 64 181 .................... 1 4 253 .................... 88 90
110 .................... 102 34 182 .................... 1 5 254 .................... 103 84
111 .................... 103 28 183 .................... 1 6 255 .................... 103 85
112 .................... 103 28 184 .................... 1 5 256 .................... 102 84
113 .................... 103 19 185 .................... 1 3 257 .................... 58 66
114 .................... 103 32 186 .................... 1 4 258 .................... 64 97
115 .................... 104 25 187 .................... 1 4 259 .................... 56 80
116 .................... 103 38 188 .................... 1 6 260 .................... 51 67
117 .................... 103 39 189 .................... 8 18 261 .................... 52 96
118 .................... 103 34 190 .................... 20 51 262 .................... 63 62
119 .................... 102 44 191 .................... 49 19 263 .................... 71 6
120 .................... 103 38 192 .................... 41 13 264 .................... 33 16
121 .................... 102 43 193 .................... 31 16 265 .................... 47 45
122 .................... 103 34 194 .................... 28 21 266 .................... 43 56
123 .................... 102 41 195 .................... 21 17 267 .................... 42 27
124 .................... 103 44 196 .................... 31 21 268 .................... 42 64
125 .................... 103 37 197 .................... 21 8 269 .................... 75 74
126 .................... 103 27 198 .................... 0 14 270 .................... 68 96
127 .................... 104 13 199 .................... 0 12 271 .................... 86 61
128 .................... 104 30 200 .................... 3 8 272 .................... 66 0
129 .................... 104 19 201 .................... 3 22 273 .................... 37 0
130 .................... 103 28 202 .................... 12 20 274 .................... 45 37
131 .................... 104 40 203 .................... 14 20 275 .................... 68 96
132 .................... 104 32 204 .................... 16 17 276 .................... 80 97
133 .................... 101 63 205 .................... 20 18 277 .................... 92 96
134 .................... 102 54 206 .................... 27 34 278 .................... 90 97
135 .................... 102 52 207 .................... 32 33 279 .................... 82 96
136 .................... 102 51 208 .................... 41 31 280 .................... 94 81
137 .................... 103 40 209 .................... 43 31 281 .................... 90 85
138 .................... 104 34 210 .................... 37 33 282 .................... 96 65
139 .................... 102 36 211 .................... 26 18 283 .................... 70 96

284 .................... 55 95 356 .................... 72 49 428 .................... 76 57

285 .................... 70 96 357 .................... 56 27 429 .................... 76 72
286 .................... 79 96 358 .................... 29 0 430 .................... 85 72
287 .................... 81 71 359 .................... 18 13 431 .................... 84 60
288 .................... 71 60 360 .................... 25 11 432 .................... 83 72
289 .................... 92 65 361 .................... 28 24 433 .................... 83 72
290 .................... 82 63 362 .................... 34 53 434 .................... 86 72
291 .................... 61 47 363 .................... 65 83 435 .................... 89 72
292 .................... 52 37 364 .................... 80 44 436 .................... 86 72
293 .................... 24 0 365 .................... 77 46 437 .................... 87 72
294 .................... 20 7 366 .................... 76 50 438 .................... 88 72
295 .................... 39 48 367 .................... 45 52 439 .................... 88 71
296 .................... 39 54 368 .................... 61 98 440 .................... 87 72
297 .................... 63 58 369 .................... 61 69 441 .................... 85 71
298 .................... 53 31 370 .................... 63 49 442 .................... 88 72
299 .................... 51 24 371 .................... 32 0 443 .................... 88 72
300 .................... 48 40 372 .................... 10 8 444 .................... 84 72
301 .................... 39 0 373 .................... 17 7 445 .................... 83 73
302 .................... 35 18 374 .................... 16 13 446 .................... 77 73
303 .................... 36 16 375 .................... 11 6 447 .................... 74 73
304 .................... 29 17 376 .................... 9 5 448 .................... 76 72
305 .................... 28 21 377 .................... 9 12 449 .................... 46 77
306 .................... 31 15 378 .................... 12 46 450 .................... 78 62
307 .................... 31 10 379 .................... 15 30 451 .................... 79 35
308 .................... 43 19 380 .................... 26 28 452 .................... 82 38
309 .................... 49 63 381 .................... 13 9 453 .................... 81 41
310 .................... 78 61 382 .................... 16 21 454 .................... 79 37
311 .................... 78 46 383 .................... 24 4 455 .................... 78 35
312 .................... 66 65 384 .................... 36 43 456 .................... 78 38
313 .................... 78 97 385 .................... 65 85 457 .................... 78 46
314 .................... 84 63 386 .................... 78 66 458 .................... 75 49
315 .................... 57 26 387 .................... 63 39 459 .................... 73 50
316 .................... 36 22 388 .................... 32 34 460 .................... 79 58
317 .................... 20 34 389 .................... 46 55 461 .................... 79 71
318 .................... 19 8 390 .................... 47 42 462 .................... 83 44
319 .................... 9 10 391 .................... 42 39 463 .................... 53 48
320 .................... 5 5 392 .................... 27 0 464 .................... 40 48
321 .................... 7 11 393 .................... 14 5 465 .................... 51 75
322 .................... 15 15 394 .................... 14 14 466 .................... 75 72
323 .................... 12 9 395 .................... 24 54 467 .................... 89 67
324 .................... 13 27 396 .................... 60 90 468 .................... 93 60
325 .................... 15 28 397 .................... 53 66 469 .................... 89 73
326 .................... 16 28 398 .................... 70 48 470 .................... 86 73
327 .................... 16 31 399 .................... 77 93 471 .................... 81 73
328 .................... 15 20 400 .................... 79 67 472 .................... 78 73
329 .................... 17 0 401 .................... 46 65 473 .................... 78 73
330 .................... 20 34 402 .................... 69 98 474 .................... 76 73
331 .................... 21 25 403 .................... 80 97 475 .................... 79 73
332 .................... 20 0 404 .................... 74 97 476 .................... 82 73
333 .................... 23 25 405 .................... 75 98 477 .................... 86 73
334 .................... 30 58 406 .................... 56 61 478 .................... 88 72
335 .................... 63 96 407 .................... 42 0 479 .................... 92 71
336 .................... 83 60 408 .................... 36 32 480 .................... 97 54
337 .................... 61 0 409 .................... 34 43 481 .................... 73 43
338 .................... 26 0 410 .................... 68 83 482 .................... 36 64
339 .................... 29 44 411 .................... 102 48 483 .................... 63 31
340 .................... 68 97 412 .................... 62 0 484 .................... 78 1
341 .................... 80 97 413 .................... 41 39 485 .................... 69 27
342 .................... 88 97 414 .................... 71 86 486 .................... 67 28
343 .................... 99 88 415 .................... 91 52 487 .................... 72 9
344 .................... 102 86 416 .................... 89 55 488 .................... 71 9
345 .................... 100 82 417 .................... 89 56 489 .................... 78 36
346 .................... 74 79 418 .................... 88 58 490 .................... 81 56
347 .................... 57 79 419 .................... 78 69 491 .................... 75 53
348 .................... 76 97 420 .................... 98 39 492 .................... 60 45
349 .................... 84 97 421 .................... 64 61 493 .................... 50 37
350 .................... 86 97 422 .................... 90 34 494 .................... 66 41
351 .................... 81 98 423 .................... 88 38 495 .................... 51 61
352 .................... 83 83 424 .................... 97 62 496 .................... 68 47
353 .................... 65 96 425 .................... 100 53 497 .................... 29 42
354 .................... 93 72 426 .................... 81 58 498 .................... 24 73
355 .................... 63 60 427 .................... 74 51 499 .................... 64 71

500 .................... 90 71 572 .................... 83 57 644 .................... 79 72

501 .................... 100 61 573 .................... 86 52 645 .................... 78 70
502 .................... 94 73 574 .................... 85 51 646 .................... 80 70
503 .................... 84 73 575 .................... 70 39 647 .................... 82 71
504 .................... 79 73 576 .................... 50 5 648 .................... 84 71
505 .................... 75 72 577 .................... 38 36 649 .................... 83 71
506 .................... 78 73 578 .................... 30 71 650 .................... 83 73
507 .................... 80 73 579 .................... 75 53 651 .................... 81 70
508 .................... 81 73 580 .................... 84 40 652 .................... 80 71
509 .................... 81 73 581 .................... 85 42 653 .................... 78 71
510 .................... 83 73 582 .................... 86 49 654 .................... 76 70
511 .................... 85 73 583 .................... 86 57 655 .................... 76 70
512 .................... 84 73 584 .................... 89 68 656 .................... 76 71
513 .................... 85 73 585 .................... 99 61 657 .................... 79 71
514 .................... 86 73 586 .................... 77 29 658 .................... 78 71
515 .................... 85 73 587 .................... 81 72 659 .................... 81 70
516 .................... 85 73 588 .................... 89 69 660 .................... 83 72
517 .................... 85 72 589 .................... 49 56 661 .................... 84 71
518 .................... 85 73 590 .................... 79 70 662 .................... 86 71
519 .................... 83 73 591 .................... 104 59 663 .................... 87 71
520 .................... 79 73 592 .................... 103 54 664 .................... 92 72
521 .................... 78 73 593 .................... 102 56 665 .................... 91 72
522 .................... 81 73 594 .................... 102 56 666 .................... 90 71
523 .................... 82 72 595 .................... 103 61 667 .................... 90 71
524 .................... 94 56 596 .................... 102 64 668 .................... 91 71
525 .................... 66 48 597 .................... 103 60 669 .................... 90 70
526 .................... 35 71 598 .................... 93 72 670 .................... 90 72
527 .................... 51 44 599 .................... 86 73 671 .................... 91 71
528 .................... 60 23 600 .................... 76 73 672 .................... 90 71
529 .................... 64 10 601 .................... 59 49 673 .................... 90 71
530 .................... 63 14 602 .................... 46 22 674 .................... 92 72
531 .................... 70 37 603 .................... 40 65 675 .................... 93 69
532 .................... 76 45 604 .................... 72 31 676 .................... 90 70
533 .................... 78 18 605 .................... 72 27 677 .................... 93 72
534 .................... 76 51 606 .................... 67 44 678 .................... 91 70
535 .................... 75 33 607 .................... 68 37 679 .................... 89 71
536 .................... 81 17 608 .................... 67 42 680 .................... 91 71
537 .................... 76 45 609 .................... 68 50 681 .................... 90 71
538 .................... 76 30 610 .................... 77 43 682 .................... 90 71
539 .................... 80 14 611 .................... 58 4 683 .................... 92 71
540 .................... 71 18 612 .................... 22 37 684 .................... 91 71
541 .................... 71 14 613 .................... 57 69 685 .................... 93 71
542 .................... 71 11 614 .................... 68 38 686 .................... 93 68
543 .................... 65 2 615 .................... 73 2 687 .................... 98 68
544 .................... 31 26 616 .................... 40 14 688 .................... 98 67
545 .................... 24 72 617 .................... 42 38 689 .................... 100 69
546 .................... 64 70 618 .................... 64 69 690 .................... 99 68
547 .................... 77 62 619 .................... 64 74 691 .................... 100 71
548 .................... 80 68 620 .................... 67 73 692 .................... 99 68
549 .................... 83 53 621 .................... 65 73 693 .................... 100 69
550 .................... 83 50 622 .................... 68 73 694 .................... 102 72
551 .................... 83 50 623 .................... 65 49 695 .................... 101 69
552 .................... 85 43 624 .................... 81 0 696 .................... 100 69
553 .................... 86 45 625 .................... 37 25 697 .................... 102 71
554 .................... 89 35 626 .................... 24 69 698 .................... 102 71
555 .................... 82 61 627 .................... 68 71 699 .................... 102 69
556 .................... 87 50 628 .................... 70 71 700 .................... 102 71
557 .................... 85 55 629 .................... 76 70 701 .................... 102 68
558 .................... 89 49 630 .................... 71 72 702 .................... 100 69
559 .................... 87 70 631 .................... 73 69 703 .................... 102 70
560 .................... 91 39 632 .................... 76 70 704 .................... 102 68
561 .................... 72 3 633 .................... 77 72 705 .................... 102 70
562 .................... 43 25 634 .................... 77 72 706 .................... 102 72
563 .................... 30 60 635 .................... 77 72 707 .................... 102 68
564 .................... 40 45 636 .................... 77 70 708 .................... 102 69
565 .................... 37 32 637 .................... 76 71 709 .................... 100 68
566 .................... 37 32 638 .................... 76 71 710 .................... 102 71
567 .................... 43 70 639 .................... 77 71 711 .................... 101 64
568 .................... 70 54 640 .................... 77 71 712 .................... 102 69
569 .................... 77 47 641 .................... 78 70 713 .................... 102 69
570 .................... 79 66 642 .................... 77 70 714 .................... 101 69
571 .................... 85 53 643 .................... 77 71 715 .................... 102 64

716 .................... 102 69 788 .................... 105 66 860 .................... 49 8

717 .................... 102 68 789 .................... 105 62 861 .................... 51 7
718 .................... 102 70 790 .................... 105 66 862 .................... 51 20
719 .................... 102 69 791 .................... 89 41 863 .................... 78 52
720 .................... 102 70 792 .................... 52 5 864 .................... 80 38
721 .................... 102 70 793 .................... 48 5 865 .................... 81 33
722 .................... 102 62 794 .................... 48 7 866 .................... 83 29
723 .................... 104 38 795 .................... 48 5 867 .................... 83 22
724 .................... 104 15 796 .................... 48 6 868 .................... 83 16
725 .................... 102 24 797 .................... 48 4 869 .................... 83 12
726 .................... 102 45 798 .................... 52 6 870 .................... 83 9
727 .................... 102 47 799 .................... 51 5 871 .................... 83 8
728 .................... 104 40 800 .................... 51 6 872 .................... 83 7
729 .................... 101 52 801 .................... 51 6 873 .................... 83 6
730 .................... 103 32 802 .................... 52 5 874 .................... 83 6
731 .................... 102 50 803 .................... 52 5 875 .................... 83 6
732 .................... 103 30 804 .................... 57 44 876 .................... 83 6
733 .................... 103 44 805 .................... 98 90 877 .................... 83 6
734 .................... 102 40 806 .................... 105 94 878 .................... 59 4
735 .................... 103 43 807 .................... 105 100 879 .................... 50 5
736 .................... 103 41 808 .................... 105 98 880 .................... 51 5
737 .................... 102 46 809 .................... 105 95 881 .................... 51 5
738 .................... 103 39 810 .................... 105 96 882 .................... 51 5
739 .................... 102 41 811 .................... 105 92 883 .................... 50 5
740 .................... 103 41 812 .................... 104 97 884 .................... 50 5
741 .................... 102 38 813 .................... 100 85 885 .................... 50 5
742 .................... 103 39 814 .................... 94 74 886 .................... 50 5
743 .................... 102 46 815 .................... 87 62 887 .................... 50 5
744 .................... 104 46 816 .................... 81 50 888 .................... 51 5
745 .................... 103 49 817 .................... 81 46 889 .................... 51 5
746 .................... 102 45 818 .................... 80 39 890 .................... 51 5
747 .................... 103 42 819 .................... 80 32 891 .................... 63 50
748 .................... 103 46 820 .................... 81 28 892 .................... 81 34
749 .................... 103 38 821 .................... 80 26 893 .................... 81 25
750 .................... 102 48 822 .................... 80 23 894 .................... 81 29
751 .................... 103 35 823 .................... 80 23 895 .................... 81 23
752 .................... 102 48 824 .................... 80 20 896 .................... 80 24
753 .................... 103 49 825 .................... 81 19 897 .................... 81 24
754 .................... 102 48 826 .................... 80 18 898 .................... 81 28
755 .................... 102 46 827 .................... 81 17 899 .................... 81 27
756 .................... 103 47 828 .................... 80 20 900 .................... 81 22
757 .................... 102 49 829 .................... 81 24 901 .................... 81 19
758 .................... 102 42 830 .................... 81 21 902 .................... 81 17
759 .................... 102 52 831 .................... 80 26 903 .................... 81 17
760 .................... 102 57 832 .................... 80 24 904 .................... 81 17
761 .................... 102 55 833 .................... 80 23 905 .................... 81 15
762 .................... 102 61 834 .................... 80 22 906 .................... 80 15
763 .................... 102 61 835 .................... 81 21 907 .................... 80 28
764 .................... 102 58 836 .................... 81 24 908 .................... 81 22
765 .................... 103 58 837 .................... 81 24 909 .................... 81 24
766 .................... 102 59 838 .................... 81 22 910 .................... 81 19
767 .................... 102 54 839 .................... 81 22 911 .................... 81 21
768 .................... 102 63 840 .................... 81 21 912 .................... 81 20
769 .................... 102 61 841 .................... 81 31 913 .................... 83 26
770 .................... 103 55 842 .................... 81 27 914 .................... 80 63
771 .................... 102 60 843 .................... 80 26 915 .................... 80 59
772 .................... 102 72 844 .................... 80 26 916 .................... 83 100
773 .................... 103 56 845 .................... 81 25 917 .................... 81 73
774 .................... 102 55 846 .................... 80 21 918 .................... 83 53
775 .................... 102 67 847 .................... 81 20 919 .................... 80 76
776 .................... 103 56 848 .................... 83 21 920 .................... 81 61
777 .................... 84 42 849 .................... 83 15 921 .................... 80 50
778 .................... 48 7 850 .................... 83 12 922 .................... 81 37
779 .................... 48 6 851 .................... 83 9 923 .................... 82 49
780 .................... 48 6 852 .................... 83 8 924 .................... 83 37
781 .................... 48 7 853 .................... 83 7 925 .................... 83 25
782 .................... 48 6 854 .................... 83 6 926 .................... 83 17
783 .................... 48 7 855 .................... 83 6 927 .................... 83 13
784 .................... 67 21 856 .................... 83 6 928 .................... 83 10
785 .................... 105 59 857 .................... 83 6 929 .................... 83 8
786 .................... 105 96 858 .................... 83 6 930 .................... 83 7
787 .................... 105 74 859 .................... 76 5 931 .................... 83 7

932 .................... 83 6 1004 .................. 81 29 1076 .................. 103 11

933 .................... 83 6 1005 .................. 81 28 1077 .................. 103 19
934 .................... 83 6 1006 .................. 81 24 1078 .................. 103 7
935 .................... 71 5 1007 .................. 81 19 1079 .................. 103 13
936 .................... 49 24 1008 .................. 81 16 1080 .................. 103 10
937 .................... 69 64 1009 .................. 80 16 1081 .................. 102 13
938 .................... 81 50 1010 .................. 83 23 1082 .................. 101 29
939 .................... 81 43 1011 .................. 83 17 1083 .................. 102 25
940 .................... 81 42 1012 .................. 83 13 1084 .................. 102 20
941 .................... 81 31 1013 .................. 83 27 1085 .................. 96 60
942 .................... 81 30 1014 .................. 81 58 1086 .................. 99 38
943 .................... 81 35 1015 .................. 81 60 1087 .................. 102 24
944 .................... 81 28 1016 .................. 81 46 1088 .................. 100 31
945 .................... 81 27 1017 .................. 80 41 1089 .................. 100 28
946 .................... 80 27 1018 .................. 80 36 1090 .................. 98 3
947 .................... 81 31 1019 .................. 81 26 1091 .................. 102 26
948 .................... 81 41 1020 .................. 86 18 1092 .................. 95 64
949 .................... 81 41 1021 .................. 82 35 1093 .................. 102 23
950 .................... 81 37 1022 .................. 79 53 1094 .................. 102 25
951 .................... 81 43 1023 .................. 82 30 1095 .................. 98 42
952 .................... 81 34 1024 .................. 83 29 1096 .................. 93 68
953 .................... 81 31 1025 .................. 83 32 1097 .................. 101 25
954 .................... 81 26 1026 .................. 83 28 1098 .................. 95 64
955 .................... 81 23 1027 .................. 76 60 1099 .................. 101 35
956 .................... 81 27 1028 .................. 79 51 1100 .................. 94 59
957 .................... 81 38 1029 .................. 86 26 1101 .................. 97 37
958 .................... 81 40 1030 .................. 82 34 1102 .................. 97 60
959 .................... 81 39 1031 .................. 84 25 1103 .................. 93 98
960 .................... 81 27 1032 .................. 86 23 1104 .................. 98 53
961 .................... 81 33 1033 .................. 85 22 1105 .................. 103 13
962 .................... 80 28 1034 .................. 83 26 1106 .................. 103 11
963 .................... 81 34 1035 .................. 83 25 1107 .................. 103 11
964 .................... 83 72 1036 .................. 83 37 1108 .................. 103 13
965 .................... 81 49 1037 .................. 84 14 1109 .................. 103 10
966 .................... 81 51 1038 .................. 83 39 1110 .................. 103 10
967 .................... 80 55 1039 .................. 76 70 1111 .................. 103 11
968 .................... 81 48 1040 .................. 78 81 1112 .................. 103 10
969 .................... 81 36 1041 .................. 75 71 1113 .................. 103 10
970 .................... 81 39 1042 .................. 86 47 1114 .................. 102 18
971 .................... 81 38 1043 .................. 83 35 1115 .................. 102 31
972 .................... 80 41 1044 .................. 81 43 1116 .................. 101 24
973 .................... 81 30 1045 .................. 81 41 1117 .................. 102 19
974 .................... 81 23 1046 .................. 79 46 1118 .................. 103 10
975 .................... 81 19 1047 .................. 80 44 1119 .................. 102 12
976 .................... 81 25 1048 .................. 84 20 1120 .................. 99 56
977 .................... 81 29 1049 .................. 79 31 1121 .................. 96 59
978 .................... 83 47 1050 .................. 87 29 1122 .................. 74 28
979 .................... 81 90 1051 .................. 82 49 1123 .................. 66 62
980 .................... 81 75 1052 .................. 84 21 1124 .................. 74 29
981 .................... 80 60 1053 .................. 82 56 1125 .................. 64 74
982 .................... 81 48 1054 .................. 81 30 1126 .................. 69 40
983 .................... 81 41 1055 .................. 85 21 1127 .................. 76 2
984 .................... 81 30 1056 .................. 86 16 1128 .................. 72 29
985 .................... 80 24 1057 .................. 79 52 1129 .................. 66 65
986 .................... 81 20 1058 .................. 78 60 1130 .................. 54 69
987 .................... 81 21 1059 .................. 74 55 1131 .................. 69 56
988 .................... 81 29 1060 .................. 78 84 1132 .................. 69 40
989 .................... 81 29 1061 .................. 80 54 1133 .................. 73 54
990 .................... 81 27 1062 .................. 80 35 1134 .................. 63 92
991 .................... 81 23 1063 .................. 82 24 1135 .................. 61 67
992 .................... 81 25 1064 .................. 83 43 1136 .................. 72 42
993 .................... 81 26 1065 .................. 79 49 1137 .................. 78 2
994 .................... 81 22 1066 .................. 83 50 1138 .................. 76 34
995 .................... 81 20 1067 .................. 86 12 1139 .................. 67 80
996 .................... 81 17 1068 .................. 64 14 1140 .................. 70 67
997 .................... 81 23 1069 .................. 24 14 1141 .................. 53 70
998 .................... 83 65 1070 .................. 49 21 1142 .................. 72 65
999 .................... 81 54 1071 .................. 77 48 1143 .................. 60 57
1000 .................. 81 50 1072 .................. 103 11 1144 .................. 74 29
1001 .................. 81 41 1073 .................. 98 48 1145 .................. 69 31
1002 .................. 81 35 1074 .................. 101 34 1146 .................. 76 1
1003 .................. 81 37 1075 .................. 99 39 1147 .................. 74 22
Normalized Normalized Normalized Normalized § 1048.801 What definitions apply to this

Time(s) speed torque Time(s) speed torque part?
(percent) (percent) (percent) (percent) * * * * *
Critical emission-related component
1148 .................. 72 52 1220 .................. 0 0 means any of the following components:
1149 .................. 62 96 1221 .................. 0 0
1150 .................. 54 72
(1) Electronic control units,
1222 .................. 0 0
1151 .................. 72 28 1223 .................. 0 0 aftertreatment devices, fuel-metering
1152 .................. 72 35 1224 .................. 0 0 components, EGR-system components,
1153 .................. 64 68 1225 .................. 0 0 crankcase-ventilation valves, all
1154 .................. 74 27 1226 .................. 0 0 components related to charge-air
1155 .................. 76 14 1227 .................. 0 0 compression and cooling, and all
1156 .................. 69 38 1228 .................. 0 0 sensors and actuators associated with
1157 .................. 66 59 1229 .................. 0 0 any of these components.
1158 .................. 64 99 1230 .................. 0 0 (2) Any other component whose
1159 .................. 51 86 1231 .................. 0 0 primary purpose is to reduce emissions.
1160 .................. 70 53 1232 .................. 0 0
1161 .................. 72 36 1233 .................. 0 0 * * * * *
1162 .................. 71 47 1234 .................. 0 0
1163 .................. 70 42 1235 .................. 0 0 PART 1051—CONTROL OF EMISSIONS
1164 .................. 67 34 1236 .................. 0 0 FROM RECREATIONAL ENGINES AND
1165 .................. 74 2 1237 .................. 0 0 VEHICLES
1166 .................. 75 21 1238 .................. 0 0
1167 .................. 74 15 ■ 92. The authority citation for part 1051
1168 .................. 75 13 continues to read as follows:
1169 .................. 76 10 PART 1048—CONTROL OF EMISSIONS Authority: 42 U.S.C. 7401–7671(q).
1170 .................. 75 13 FROM NEW, LARGE NONROAD
1171 .................. 75 10 SPARK-IGNITION ENGINES ■ 93. Section 1051.125 is amended by
1172 .................. 75 7 revising paragraph (a) introductory text
1173 .................. 75 13 ■ 89. The authority citation for part 1048 and paragraph (d) to read as follows:
1174 .................. 76 8 continues to read as follows:
1175 .................. 76 7 § 1051.125 What maintenance instructions
Authority: 42 U.S.C. 7401–7671(q). must I give to buyers?
1176 .................. 67 45
1177 .................. 75 13 ■ 90. Section 1048.125 is amended by (a) Critical emission-related
1178 .................. 75 12 revising paragraph (a) introductory text maintenance. Critical emission-related
1179 .................. 73 21 and paragraph (d) to read as follows: maintenance includes any adjustment,
1180 .................. 68 46 cleaning, repair, or replacement of
1181 .................. 74 8 § 1048.125 What maintenance instructions
1182 .................. 76 11 must I give to buyers? critical emission-related components.
1183 .................. 76 14 This may also include additional
(a) Critical emission-related
1184 .................. 74 11 emission-related maintenance that you
maintenance. Critical emission-related
1185 .................. 74 18 determine is critical if we approve it in
maintenance includes any adjustment,
1186 .................. 73 22 advance. You may schedule critical
cleaning, repair, or replacement of
1187 .................. 74 20 emission-related maintenance on these
1188 .................. 74 19 critical emission-related components.
components if you meet the following
1189 .................. 70 22 This may also include additional
conditions:
1190 .................. 71 23 emission-related maintenance that you
1191 .................. 73 19 determine is critical if we approve it in * * * * *
1192 .................. 73 19 advance. You may schedule critical (d) Noncritical emission-related
1193 .................. 72 20 emission-related maintenance on these maintenance. You may schedule any
1194 .................. 64 60 components if you meet the following amount of emission-related inspection Ä
1195 .................. 70 39 conditions: or maintenance that is not covered by Ä
1196 .................. 66 56 paragraph (a) of this section, as long as Ä
1197 .................. 68 64 * * * * * you state in the owners manual that Ä
1198 .................. 30 68 (d) Noncritical emission-related
these steps are not necessary to keep the Ä
1199 .................. 70 38 maintenance. You may schedule any
emission-related warranty valid. If Ä
1200 .................. 66 47 amount of emission-related inspection Ä
operators fail to do this maintenance, Ä
1201 .................. 76 14 or maintenance that is not covered by Ä
1202 .................. 74 18 this does not allow you to disqualify Ä
paragraph (a) of this section, as long as Ä
1203 .................. 69 46 those engines from in-use testing or Ä
you state in the owners manual that Ä
1204 .................. 68 62 deny a warranty claim. Do not take Ä
these steps are not necessary to keep the Ä
1205 .................. 68 62 these inspection or maintenance steps Ä
emission-related warranty valid. If Ä
1206 .................. 68 62 during service accumulation on your Ä
1207 .................. 68 62 operators fail to do this maintenance, Ä
emission-data engines.Ä
1208 .................. 68 62 this does not allow you to disqualify Ä
those engines from in-use testing or Ä * * * * *Ä
1209 .................. 68 62
■ 94. Section 1051.801 is amended by Ä
1210 .................. 54 50 deny a warranty claim. Do not take Ä
1211 .................. 41 37 these inspection or maintenance steps Ä adding a definition for ‘‘Critical Ä
1212 .................. 27 25 during service accumulation on your Ä emission-related component’’ in Ä
1213 .................. 14 12 emission-data engines.Ä alphabetical order to read as follows:Ä
1214 .................. 0 0
1215 .................. 0 0 * * * * *Ä § 1051.801 What definitions apply to this
1216 .................. 0 0 ■ 91. Section 1048.801 is amended by Ä part?
1217 .................. 0 0 adding a definition for ‘‘Critical Ä * * * * *
1218 .................. 0 0 emission-related component’’ in Ä Critical emission-related component
1219 .................. 0 0 alphabetical order to read as follows:Ä means any of the following components:
(1) Electronic control units, (1) Large nonroad spark-ignition procedure until we approve them, either
aftertreatment devices, fuel-metering engines we regulate under 40 CFR part by: telling you directly that you may use
components, EGR-system components, 1048. this procedure; or issuing guidance to
crankcase-ventilation valves, all (2) Vehicles that we regulate under 40 all manufacturers, which allows you to
components related to charge-air CFR part 1051 (i.e., recreational SI use the alternate procedure without
compression and cooling, and all vehicles) that are regulated based on additional approval. You may use the
sensors and actuators associated with engine testing. See 40 CFR part 1051 to statistical procedures specified in 40
any of these components. determine which vehicles may be CFR 86.1306–07(d) to demonstrate
(2) Any other component whose certified based on engine test data. equivalence, except that you test for
primary purpose is to reduce emissions. (3) Land-based nonroad compression- equal variances by performing the F-test
* * * * * ignition engines we regulate under 40 as follows, instead of the method
CFR part 1039. specified in § 86.1306–07(d)(5)(iv)(C):
PART 1065—TEST PROCEDURES AND * * * * *
EQUIPMENT (i) Form the F ratio: F = (Asd/Rsd) 2.
revising paragraph (c)(3) to read as Where:
■ 95. The authority citation for part 1065
follows: Asd = the standard deviation of
continues to read as follows:
measurements with the alternate system.
Authority: 42 U.S.C. 7401–7671(q). § 1065.10 Other test procedures. Rsd = the standard deviation of
■ 96. Section 1065.1 is amended by * * * * * measurements with the reference system.
revising paragraph (a) and removing and (c) * * * (ii) F must be less than the critical t value,
reserving paragraph (b)(6) to read as (3) You may ask to use alternate Fcrit, at a 90% confidence interval for
follows: procedures that produce measurements ‘‘n-1’’ degrees of freedom.
equivalent to those from the specified (iii) The following table lists 90%
§ 1065.1 Applicability. procedures. If you send us a written confidence-interval Fcrit values for n–1
(a) This part describes the procedures request showing your procedures are degrees of freedom. Note that nA
that apply to testing that we require for equivalent, and we agree that they are represents the number of alternate
the following engines or for equipment equivalent, we will allow you to use system samples, while nR represents the
using the following engines: them. You may not use an alternate number of reference system samples:
nR-1 nA-1 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
6 ........ ......... 3.055 3.014 2.983 2.958 2.937 2.92 2.905 2.892 2.881 2.871 2.863 2.855 2.848 2.842 2.836
7 ........ ......... 2.827 2.785 2.752 2.725 2.703 2.684 2.668 2.654 2.643 2.632 2.623 2.615 2.607 2.601 2.595
8 ........ ......... 2.668 2.624 2.589 2.561 2.538 2.519 2.502 2.488 2.475 2.464 2.455 2.446 2.438 2.431 2.425
9 ........ ......... 2.551 2.505 2.469 2.440 2.416 2.396 2.379 2.364 2.351 2.340 2.329 2.320 2.312 2.305 2.298
10 ...... ......... 2.461 2.414 2.377 2.347 2.323 2.302 2.284 2.269 2.255 2.244 2.233 2.224 2.215 2.208 2.201
11 ...... ......... 2.389 2.342 2.304 2.274 2.248 2.227 2.209 2.193 2.179 2.167 2.156 2.147 2.138 2.13 2.123
12 ...... ......... 2.331 2.283 2.245 2.214 2.188 2.166 2.147 2.131 2.117 2.105 2.094 2.084 2.075 2.067 2.06
13 ...... ......... 2.283 2.234 2.195 2.164 2.138 2.116 2.097 2.080 2.066 2.053 2.042 2.032 2.023 2.014 2.007
14 ...... ......... 2.243 2.193 2.154 2.122 2.095 2.073 2.054 2.037 2.022 2.010 1.998 1.988 1.978 1.97 1.962
15 ...... ......... 2.208 2.158 2.119 2.086 2.059 2.037 2.017 2.000 1.985 1.972 1.961 1.950 1.941 1.932 1.924
16 ...... ......... 2.178 2.128 2.088 2.055 2.028 2.005 1.985 1.968 1.953 1.940 1.928 1.917 1.908 1.899 1.891
17 ...... ......... 2.152 2.102 2.061 2.028 2.001 1.978 1.958 1.940 1.925 1.912 1.900 1.889 1.879 1.87 1.862
18 ...... ......... 2.130 2.079 2.038 2.005 1.977 1.954 1.933 1.916 1.900 1.887 1.875 1.864 1.854 1.845 1.837
19 ...... ......... 2.109 2.058 2.017 1.984 1.956 1.932 1.912 1.894 1.878 1.865 1.852 1.841 1.831 1.822 1.814
20 ...... ......... 2.091 2.040 1.999 1.965 1.937 1.913 1.892 1.875 1.859 1.845 1.833 1.821 1.811 1.802 1.794
* * * * * (b) Raw-gas sampling during steady- § 1065.205 Test fuel specifications for
state tests as specified in 40 CFR 89.412 distillate diesel fuel.
■ 98. In § 1065.115, text is added to read
as follows: through 89.418. (a)(1) There are three grades of #2
(c) Partial-flow sampling for diesel fuel specified for use as a test
§ 1065.115 Exhaust gas sampling system;
measuring gaseous emission fuel. See the standard-setting part to
compression-ignition engines. determine which grade to use. If the
constituents during steady-state tests as
standard-setting part does not specify
Use one of the following systems and specified in 40 CFR 89.112(c).
which grade to use, use good
procedures to measure emissions from ■ 99. In § 1065.205, text is added to read engineering judgment to select the grade
compression-ignition engines: as follows: that represents the fuel on which the
(a) Full-flow dilution sampling as engines will operate in use. The three
specified in 40 CFR 86.1310. grades are specified as follows:
ASTM test Ultra low

Item Low sulfur High sulfur
method No.1 sulfur
(i) Cetane Number ............................................................ ........................... D 613 40–50 40–50 40–50

(ii) Cetane Index ............................................................... ........................... D 976 40–50 40–50 40–50
(iii) Distillation range:
(A) IBP ....................................................................... °C ..................... D 86 171–204 171–204 171–204
(B) 10 pct. point ......................................................... °C ..................... D 86 204–238 204–238 204–238
(C) 50 pct. point ......................................................... °C ..................... D 86 243–282 243–282 243–282
(D) 90 pct. point ......................................................... °C ..................... D 86 293–332 293–332 293–332
ASTM test Ultra low

Item Low sulfur High sulfur
method No.1 sulfur
(E) EP ........................................................................ °C ..................... D 86 321–366 321–366 321–366

(iv) Gravity ......................................................................... °API .................. D 287 32–37 32–37 32–37
(v) Total sulfur ................................................................... ppm .................. D 2622 7–15 300–500 2000–4000
(vi) Hydrocarbon composition:
Aromatics, minimum. (Remainder shall be paraffins, pct ..................... D 5186 10 10 10
naphthenes, and olefins).
(vii) Flashpoint, min ........................................................... °C ..................... D 93 54 54 54
(viii) Viscosity .................................................................... centistokes ........ D 445 2.0–3.2 2.0–3.2 2.0–3.2
1 All ASTM standards are incorporated by reference in § 1065.1010.
(2) [Reserved] (b) Run the test engine, with all § 1065.530 Test cycle validation criteria.
(b) There are no specifications for #1 emission-control systems operating, * * * * *
diesel fuel. See § 1065.201(d) if your long enough to stabilize emission levels. (b) * * *
engines are designed to operate only on (1) For SI engines, if you accumulate (3) * * *
#1 diesel fuel. 50 hours of operation, you may consider (iii) For a valid test, make sure the
■ 100. In § 1065.310, text is added to
emission levels stable without feedback cycle’s integrated brake
read as follows: kilowatt-hour is within 5 percent of the
measurement.
§ 1065.310 CVS calibration. (2) For CI engines, if you accumulate reference cycle’s integrated brake
Use the procedures of 40 CFR 125 hours of operation, you may kilowatt-hour. Also, ensure that the
86.1319–90 to calibrate the CVS. consider emission levels stable without slope, intercept, standard error, and
■ 101. Section 1065.405 is amended by measurement. coefficient of determination meet the
revising paragraph (b) to read as follows: criteria in the following tables (you may
* * * * * delete individual points from the
§ 1065.405 Preparing and servicing a test ■ 102. Section 1065.530 is amended by regression analyses, consistent with
engine. revising paragraph (b)(3)(iii) and adding paragraph (e) of this section and good
* * * * * paragraphs (d) and (e) to read as follows: engineering judgment):
TABLE 1 OF § 1065.530.—S TATISTICAL CRITERIA FOR VALIDATING TEST CYCLES FOR SPARK-IGNITION ENGINES
Speed Torque Power
1. Slope of the regression line (m) ...... 0.950 to 1.030 ............... 0.830 to 1.030 ................................... 0.880 to 1.030.
2. Y intercept of the regression line (b) |b| ≤ 50 rpm ................... |b| ≤ 5.0 percent of maximum torque |b| ≤ 3.0 percent of maximum torque
from power map. from power map.
3. Standard error of the estimate of Y 100 rpm ......................... 15 percent of maximum torque from 10 percent of maximum power from
on X (SE). power map. power map.
4. Coefficient of determination (r 2) ...... r 2 ≥ 0.970 ...................... r 2 ≥ 0.880 .......................................... r 2 ≥ 0.900.
TABLE 2 OF § 1065.530.—S TATISTICAL CRITERIA FOR VALIDATING TEST CYCLES FOR COMPRESSION-IGNITION ENGINES
Speed Torque Power
1. Slope of the regression line (m) ...... 0.950 to 1.030 ............... 0.830 to 1.030 (hot); 0.77 to 1.03 0.890 to 1.030 (hot); 0.870 to 1.030
(cold). (cold).
2. Y intercept of the regression line (b) |b| ≤ 50 rpm ................... |b| ≤ 20 Nm or |b| ≤ 2.0 percent of |b| ≤ 4.0 kW or |b| ≤ 3.0 percent of
maximum torque from power map, maximum torque from power map,
whichever is greater. whichever is greater.
3. Standard error of the estimate of Y 100 rpm ......................... 13 percent of maximum torque from 8 percent of maximum power from
on X (SE). power map. power map.
4. Coefficient of determination (r 2) ...... r 2 ≥ 0.970 ...................... r 2 ≥ 0.880 (hot); r 2 ≥ 0.850 (cold); ... r 2 ≥ 0.910 (hot); r 2 ≥ 0.850 (cold).
* * * * * (2) Feedback speed and power during approaching maximum demand, if all
(d) Transient testing with constant- idle-speed oscillations, if all the the following are true:
speed engines. For constant-speed following are true: (i) Operator demand (i.e., throttle) is
engines with installed governor (i) Reference command is 0% speed at its maximum.
operating over a transient duty cycle, and 0% torque.
the test cycle validation criteria in this (ii) Either feedback speed is less than
(ii) Operator demand (i.e., throttle) is reference speed or feedback torque is
section apply to engine-torque values
at its minimum. less than reference torque, but both are
but not engine-speed values.
(e) Omissions. You may omit the (iii) Absolute value of feedback torque not less than their respective reference
following points from duty cycle is less than the sum of the reference values.
statistics calculations: torque plus 2% of the maximum (4) Feedback power and either speed
(1) Feedback torque and power during mapped torque. or torque for a given point, when
motoring reference commands when (3) Feedback power and either speed approaching minimum demand, if all
operator demand is at its minimum. or torque for a given point when the following are true:
(i) Operator demand (i.e., throttle) is comparable to those of dynamometer it must demonstrate that the alternate
at its minimum. testing. Measurement systems that system passes a two-sided, paired t-test.
(ii) Either feedback speed is greater conform to the provisions of If the test is unpaired, it must
than 105% of reference speed or §§ 1065.915 through 1065.950 are demonstrate that the alternate system
feedback torque is greater than 105% of deemed to be in compliance with the passes a two-sided, unpaired t-test. The
reference torque, but both are not greater accuracy and precision requirements of average of these tests for the reference
than these values. paragraph of this section. If you use system must return results less than or
■ 103. Section 1065.615 is amended by other field testing measurement systems equal to the applicable emissions
revising paragraphs (c), (d), and (e) to you need to have documentation standard. The t-test is performed as
read as follows: indicating that it is comparable to a follows, where ‘‘n’’ equals the number
§ 1065.615 Bag sample calculations. dynamometer system. of tests:
(a) The two systems must be (1) Calculate the average of the in-use
* * * * * calibrated independently to NIST
(c) Calculate total brake work (kW-hr) system results; this is Iavg.
traceable standards or equivalent
done during the emissions sampling national standards for this comparison.
(2) Calculate the average of the results
period of each segment or mode and of the system to which the in-use system
We may approve the use of other
then weight it by the applicable test was Referenced; this is Ravg.
standards. Calculations of emissions
cycle weighting factors. (3) Calculate the ‘‘n-1’’ standard
(d) Calculate emissions in g/kW-hr by results for this test should be consistent
with the field testing data reduction deviations for the in-use and reference
dividing the total weighted mass averages; these are Isd and Rsd
emission rate (g/test) by the total cycle- scheme for both the in-use equipment
and the dynamometer equipment, and respectively. Form the F ratio: F = (Isd/
weighted brake work for the test. Rsd) 2. F must be less than the critical
(e) Apply deterioration factors or each complete test cycle will be
considered one ‘‘summing interval’’, Si F value, Fcrit at a 95% confidence
other adjustment factors to the brake- interval for ‘‘n-1’’ degrees of freedom.
specific emission rate in paragraph (d) as defined in the field-testing data
reduction scheme. Table 1 of this section lists 95%
of this section, as specified in the
(b) While other statistical analyses confidence interval Fcrit values for n-1
standard-setting part.
■ 104. Section 1065.620 is added to may be acceptable, we recommend that degrees of freedom. Note that nA
subpart G to read as follows: the comparison be based on a minimum represents the number of alternate
of seven (7) repeats of colocated and system samples, while nR represents the
§ 1065.620 Continuous sample analysis simultaneous tests. Perform this number of reference system samples.
and calculations. comparison over the applicable steady- (4) For an unpaired comparison,
Use the sample analysis procedures state and transient test cycles using an calculate the t-value:
and calculations of 40 CFR part 86, engine that is fully warmed up such that tunpaired = (Iavg ¥ Ravg)/((Isd2 +Rsd2)/n)1⁄2
subpart N, for continuous samples. its coolant temperature is
■ 105. Section 1065.701 is added to thermostatically controlled. If there is (5) For a paired comparison, calculate
subpart H to read as follows: no applicable transient test cycle, use the ‘‘n-1’’ standard deviation (squared)
§ 1065.701 Particulate measurements. the applicable steady-state cycle. of the differences, di, between the paired
Anyone who intends to submit an results, where ‘‘i’’ represents the ith test
Use the particulate sampling system
alternative comparison is encouraged to of n number of tests:
and procedures specified in 40 CFR part
86, subpart N, to measure particulate first contact EPA Office of SD2 = (Sdi2 ¥ ((Sdi)2/n))/(n-1)
emissions from compression-ignition Transportation and Air Quality,
Assessment and Standards Division to (6) For a paired comparison, calculate
nonroad engines.
■ 106. Section 1065.910 is revised to discuss the applicant’s intended the t-value:
read as follows: statistical analysis. The Division may tpaired = (Iavg ¥ Ravg)/(SD2/n)1⁄2
provide further guidance specific to the
§ 1065.910 Measurement accuracy and appropriate statistical analysis for the (d) The absolute value of t must be
precision. respective application. less than the critical t value, tcrit at a
Measurement systems used for field (c) The following statistical tests are 95% confidence interval for ‘‘n-1’’
testing have accuracy and precision suggested. If the comparison is paired, degrees of freedom.
TABLE 1 OF § 1065.910—95% C ONFIDENCE INTERVAL CRITICAL F VALUES FOR F-TEST

nR–1 nI–1 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20
6 ........ ......... 4.284 4.207 4.147 4.099 4.06 4.027 4 3.976 3.956 3.938 3.922 3.908 3.896 3.884 3.874
7 ........ ......... 3.866 3.787 3.726 3.677 3.637 3.603 3.575 3.55 3.529 3.511 3.494 3.48 3.467 3.455 3.445
8 ........ ......... 3.581 3.5 3.438 3.388 3.347 3.313 3.284 3.259 3.237 3.218 3.202 3.187 3.173 3.161 3.15
9 ........ ......... 3.374 3.293 3.23 3.179 3.137 3.102 3.073 3.048 3.025 3.006 2.989 2.974 2.96 2.948 2.936
10 ...... ......... 3.217 3.135 3.072 3.02 2.978 2.943 2.913 2.887 2.865 2.845 2.828 2.812 2.798 2.785 2.774
11 ...... ......... 3.095 3.012 2.948 2.896 2.854 2.818 2.788 2.761 2.739 2.719 2.701 2.685 2.671 2.658 2.646
12 ...... ......... 2.996 2.913 2.849 2.796 2.753 2.717 2.687 2.66 2.637 2.617 2.599 2.583 2.568 2.555 2.544
13 ...... ......... 2.915 2.832 2.767 2.714 2.671 2.635 2.604 2.577 2.554 2.533 2.515 2.499 2.484 2.471 2.459
14 ...... ......... 2.848 2.764 2.699 2.646 2.602 2.565 2.534 2.507 2.484 2.463 2.445 2.428 2.413 2.4 2.388
15 ...... ......... 2.79 2.707 2.641 2.588 2.544 2.507 2.475 2.448 2.424 2.403 2.385 2.368 2.353 2.34 2.328
16 ...... ......... 2.741 2.657 2.591 2.538 2.494 2.456 2.425 2.397 2.373 2.352 2.333 2.317 2.302 2.288 2.276
17 ...... ......... 2.699 2.614 2.548 2.494 2.45 2.413 2.381 2.353 2.329 2.308 2.289 2.272 2.257 2.243 2.23
18 ...... ......... 2.661 2.577 2.51 2.456 2.412 2.374 2.342 2.314 2.29 2.269 2.25 2.233 2.217 2.203 2.191
19 ...... ......... 2.628 2.544 2.477 2.423 2.378 2.34 2.308 2.28 2.256 2.234 2.215 2.198 2.182 2.168 2.155
20 ...... ......... 2.599 2.514 2.447 2.393 2.348 2.31 2.278 2.25 2.225 2.203 2.184 2.167 2.151 2.137 2.124
TABLE 2 OF § 1065.910.—95% C ON TABLE 2 OF § 1065.910.—95% C ON mechanically or electronically signals

FIDENCE INTERVAL CRITICAL T VAL FIDENCE INTERVAL CRITICAL T VAL an input that demands engine output.
UES FOR T-TEST UES FOR T-TEST—Continued Input may be an accelerator pedal or
signal, a throttle-control lever or signal,
n-1 tcrit n-1 a fuel lever or signal, a speed lever or
tcrit
signal, or a governor setpoint or signal.
6 ................................................ 2.45 20 .............................................. 2.09 Output means engine power, P, which
7 ................................................ 2.36 is the product of engine speed, ’’, and
8 ................................................ 2.31 ■ 107. Section 1065.1001 is amended by engine torque, T.
9 ................................................ 2.26 adding the definition for ‘‘Operator
10 .............................................. 2.23 * * * * *
demand’’ in alphabetical order to read as
11 .............................................. 2.20 ■ 108. Section 1065.1010 is amended by
follows:
12 .............................................. 2.18 revising the entry for ASTM D 86–01 and
13 .............................................. 2.16 § 1065.1001 Definitions. by adding the following entries to Table
14 .............................................. 2.14
* * * * * 1 in alphanumeric order to read as
15 .............................................. 2.13
16 .............................................. 2.12 Operator demand means an engine follows:
17 .............................................. 2.11 operator’s input to control engine
§ 1065.1010 Reference materials.
18 .............................................. 2.10 output. The operator may be a person,
19 .............................................. 2.09 a governor, or other controller that (a) * * *
TABLE 1 OF § 1065.1010.—ASTM M ATERIALS

Part 1065
Document number and name
reference
ASTM D 86–01, Standard Test Method for Distillation of Petroleum Products at Atmospheric Pressure ............................. 1065.205, 1065.210
* * * * * * *
ASTM D 93–02a, Standard Test Methods for Flash Point by Pensky-Martens Closed Cup Tester ...................................... 1065.205
ASTM D 287–92, (Reapproved 2000), Standard Test Method for API Gravity of Crude Petroleum and Petroleum Prod
ucts (Hydrometer Method) ................................................................................................................................................... 1065.205
* * * * * * *
ASTM D 445–03, Standard Test Method for Kinematic Viscosity of Transparent and Opaque Liquids (and the Calcula
tion of Dynamic Viscosity) .................................................................................................................................................... 1065.205
ASTM D 613–03b, Standard Test Method for Cetane Number of Diesel Fuel Oil ................................................................. 1065.205
ASTM D 976–91 (Reapproved 2000), Standard Test Methods for Calculated Cetane Index of Distillate Fuels .................. 1065.205
* * * * * * *
ASTM D 2622–03, Standard Test Method for Sulfur in Petroleum Products by Wavelength Dispersive X-ray Fluores
cence Spectrometry ............................................................................................................................................................. 1065.205
* * * * * * *
ASTM D 5186–03, Standard Test Method for Determination of the Aromatic Content and Polynuclear Aromatic Content
of Diesel Fuels and Aviation Turbine Fuels By Supercritical Fluid Chromatography ......................................................... 1065.205
* * * * * (2) Recreational SI engines and (e)(1) The provisions of §§ 1068.30,

vehicles that we regulate under 40 CFR 1068.310, and 1068.320 apply for
PART 1068—GENERAL COMPLIANCE part 1051 (such as snowmobiles and off- stationary spark-ignition engines built
PROVISIONS FOR NONROAD highway motorcycles). on or after January 1, 2004, and for
PROGRAMS (3) Land-based nonroad diesel engines stationary compression-ignition engines
that we regulate under 40 CFR part built on or after January 1, 2006.
■ 109. The authority citation for part 86
1039. (2) The provisions of §§ 1068.30 and
continues to read as follows:
(b) * * * 1068.235 apply for the types of engines
Authority: 42 U.S.C. 7401–7671(q). (5) Land-based nonroad diesel engines listed in paragraph (a) of this section
■ 110. Section 1068.1 is amended by that we regulate under 40 CFR part 89. beginning January 1, 2004, where they
revising paragraphs (a), (b)(5), and (d) * * * * * are used solely for competition.
and adding paragraph (e) to read as (d) Paragraph (a)(1) of this section ■ 111. Section 1068.5 is amended by
follows: identifies the parts of the CFR that revising paragraphs (a) and (e) to read as
define emission standards and other follows:
§ 1068.1 Does this part apply to me? requirements for particular types of
(a) The provisions of this part apply engines and vehicles. This part 1068 § 1068.5 How must manufacturers apply
to everyone with respect to the refers to each of these other parts good engineering judgment?
following engines and to equipment generically as the ‘‘standard-setting (a) You must use good engineering
using the following engines (including part.’’ For example, 40 CFR part 1051 is judgment for decisions related to any
owners, operators, parts manufacturers, always the standard-setting part for requirements under this chapter. This
and persons performing maintenance). snowmobiles. Follow the provisions of includes your applications for
(1) Large nonroad spark-ignition the standard-setting part if they are certification, any testing you do to show
engines we regulate under 40 CFR part different than any of the provisions in that your certification, production-line,
1048. this part. and in-use engines comply with
requirements that apply to them, and exhausted to the environment. Exhaust- purpose by both propelling itself and
how you select, categorize, determine, gas recirculation (EGR) is not performing another function (such as
and apply these requirements. aftertreatment. garden tractors, off-highway mobile
* * * * * * * * * * cranes and bulldozers); or
(e) If you disagree with our Certificate holder means a (ii) In or on a piece of equipment that
conclusions, you may file a request for manufacturer (including importers) with is intended to be propelled while
a hearing with the Designated Officer as a currently valid certificate of performing its function (such as
described in subpart G of this part. In conformity for at least one engine family lawnmowers and string trimmers); or
your request, specify your objections, in a given model year. (iii) That, by itself or in or on a piece
include data or supporting analysis, and * * * * * of equipment, is portable or
get your authorized representative’s Emission-related defect means a transportable, meaning designed to be
signature. If we agree that your request defect in design, materials, or and capable of being carried or moved
raises a substantial factual issue, we will workmanship (in an emission-control from one location to another. Indicia of
hold the hearing according to subpart F device or vehicle component or system) transportability include, but are not
of this part. that affects an emission-related limited to, wheels, skids, carrying
■ 112. Section 1068.10 is amended by component, parameter, or specification handles, dolly, trailer, or platform.
revising the section heading to read as that is identified in Appendix I or (2) An internal combustion engine is
follows: Appendix II of this part. Using an not a nonroad engine if:
incorrect emission-related component is (i) The engine is used to propel a
§ 1068.10 What provisions apply to
confidential information? an emission-related defect. motor vehicle, an aircraft, or equipment
* * * * * used solely for competition, or is subject
■ 113. Section 1068.25 is amended by to standards promulgated under section
revising paragraph (b) to read as follows: Engine-based means having emission
standards in units of grams of pollutant 202 of the Act (42 U.S.C. 7521); or
§ 1068.25 What information must I give to per kilowatt-hour, and which apply to (ii) The engine is regulated by a
EPA? the engine. Emission standards are federal New Source Performance
* * * * * either engine-based or equipment-based. Standard promulgated under section
(b) You must establish and maintain Engine manufacturer means the 111 of the Act (42 U.S.C. 7411); or
records, perform tests, make reports and manufacturer that is subject to the (iii) The engine otherwise included in
provide additional information that we certification requirements of the paragraph (1)(iii) of this definition
may reasonably require under section standard-setting part. For vehicles and remains or will remain at a location for
208 of the Act (42 U.S.C. 7542). This equipment subject to this part and more than 12 consecutive months or a
also applies to engines we exempt from regulated under vehicle-based or shorter period of time for an engine
emission standards or prohibited acts. equipment-based standards, the term located at a seasonal source. A location
■ 114. A new § 1068.27 is added to read engine manufacturer in this part is any single site at a building, structure,
as follows: includes vehicle and equipment facility, or installation. Any engine (or
manufacturers. engines) that replaces an engine at a
§ 1068.27 May EPA conduct testing with location and that is intended to perform
my production engines? Equipment-based means having
emission standards that apply to the the same or similar function as the
If we request it, you must make a engine replaced will be included in
equipment in which an engine is used,
reasonable number of production-line calculating the consecutive time period.
without regard to how the emissions are
engines available for a reasonable time Ä An engine located at a seasonal source
measured. Where equipment-based
so we can test or inspect them for Ä is an engine that remains at a seasonal
standards apply, we require that the
compliance with the requirements of Ä source during the full annual operating
equipment be certified, rather than just
this chapter.Ä period of the seasonal source. A
the engine. Emission standards are
either engine-based or equipment-based. seasonal source is a stationary source
revising the definitions for ‘‘Act’’, Ä that remains in a single location on a
‘‘Certificate holder’’, ‘‘Emission-related Ä Equipment manufacturer means any
company manufacturing a piece of permanent basis (i.e., at least two years)
defect’’, ‘‘Engine-based’’, ‘‘Engine Ä and that operates at that single location
manufacturer’’, ‘‘Equipment-based’’, Ä equipment (such as a vehicle).
Manufacturer has the meaning given approximately three months (or more)
‘‘Equipment manufacturer’’, Ä each year. This paragraph (2)(iii) does
in section 216(1) of the Act (42 U.S.C.
‘‘Manufacturer’’, ‘‘Nonroad engine’’, Ä not apply to an engine after the engine
7550(1)). In general, this term includes
‘‘Operating hours’’, and ‘‘Ultimate Ä is removed from the location.
any person who manufactures an engine
purchaser’’, and ‘‘U.S.-directed Ä
or vehicle for sale in the United States Operating hours means:
production volume’’ and adding Ä
or otherwise introduces a new engine or (1) For engine storage areas or
definitions for ‘‘Aftertreatment’’ and in Ä
vehicle into commerce in the United facilities, times during which people
alphabetical order to read as follows:Ä
States. This includes importers that other than custodians and security
§ 1068.30 What definitions apply to this import new engines or new equipment personnel are at work near, and can
part? into the United States for resale. It also access, a storage area or facility.
* * * * * includes secondary engine (2) For other areas or facilities, times
Act means the Clean Air Act, as manufacturers, as described in during which an assembly line operates
amended, 42 U.S.C. 7401–7671q. § 1068.255. or any of the following activities occurs:
Aftertreatment means relating to a * * * * * (i) Testing, maintenance, or service
catalytic converter, particulate filter, or Nonroad engine means: accumulation.
any other system, component, or (1) Except as discussed in paragraph (ii) Production or compilation of
technology mounted downstream of the (2) of this definition, a nonroad engine records.
exhaust valve (or exhaust port) whose is any internal combustion engine: (iii) Certification testing.
design function is to reduce emissions (i) In or on a piece of equipment that (iv) Translation of designs from the
in the engine exhaust before it is is self-propelled or serves a dual test stage to the production stage.
(v) Engine manufacture or assembly. with these requirements to make and time requirements of paragraph (2)(iii)
* * * * * maintain required records (including of the nonroad engine definition in
Ultimate purchaser means the first those described in § 1068.501). You may § 1068.30. We may assess a civil penalty
person who in good faith purchases a not deny us access to your records or up to $31,500 for each day you are in
new nonroad engine or new piece of the ability to copy your records if we violation.
equipment for purposes other than have the authority to see or copy them. (4) Competition engines. For an
resale. Also, you must give us the required uncertified engine or piece of
reports or information without delay. equipment that is excluded or exempted
* * * * *
U.S.-directed production volume Failure to comply with the requirements from any requirements of this chapter
of this paragraph is prohibited. We may because it is to be used solely for
means the number of engine units,
assess a civil penalty up to $31,500 for competition, you may not use it in a
subject to the requirements of this part,
each day you are in violation. manner that is inconsistent with use
produced by a manufacturer for which (3) Testing and access to facilities.
the manufacturer has a reasonable solely for competition. We may assess a
You may not keep us from entering your civil penalty up to $31,500 for each day
assurance that sale was or will be made facility to test engines or inspect if we
to ultimate purchasers in the United you are in violation.
are authorized to do so. Also, you must (5) Importation. You may not import
States. perform the tests we require (or have the an uncertified engine or piece of
* * * * *Ä tests done for you). Failure to perform equipment if it is defined to be new in
■ 116. Section 1068.101 is amended by Ä this testing is prohibited. We may assess the standard-setting part and it is built
revising paragraphs (a) and (b) to read as Ä a civil penalty up to $31,500 for each after emission standards start to apply
follows:Ä day you are in violation. in the United States. We may assess a
(b) The following prohibitions apply civil penalty up to $31,500 for each day
§ 1068.101 What general actions does this
regulation prohibit? to everyone with respect to the engines you are in violation. Note the following:
to which this part applies: (i) The definition of new is broad for
* * * * * (1) Tampering. You may not remove imported engines; uncertified engines
(a) The following prohibitions and or disable a device or element of design and equipment (including used engines
requirements apply to manufacturers of that may affect an engine’s emission and equipment) are generally
new engines and manufacturers of levels. This restriction applies before considered to be new when imported.
equipment containing these engines, and after the engine is placed in service. (ii) Engines that were originally
except as described in subparts C and D Section 1068.120 describes how this manufactured before applicable EPA
of this part: applies to rebuilding engines. For a standards were in effect are generally
(1) Introduction into commerce. You manufacturer or dealer, we may assess not subject to emission standards.
may not sell, offer for sale, or introduce a civil penalty up to $31,500 for each (6) Warranty. You must meet your
or deliver into commerce in the United engine in violation. For anyone else, we obligation to honor your emission-
States or import into the United States may assess a civil penalty up to $3,150 related warranty under § 1068.115 and
any new engine or equipment after for each engine in violation. This to fulfill any applicable responsibilities
emission standards take effect for that prohibition does not apply in any of the to recall engines under § 1068.505. Ä
engine or equipment, unless it has a following situations: Failure to meet these obligations is Ä
valid certificate of conformity for its (i) You need to repair an engine and prohibited. We may assess a civil Ä
model year and the required label or tag. you restore it to proper functioning penalty up to $31,500 for each engine in Ä
You also may not take any of the actions when the repair is complete. violation.Ä
listed in the previous sentence with (ii) You need to modify an engine to
respect to any equipment containing an * * * * *Ä
respond to a temporary emergency and ■ 117. Section 1068.105 is amended by Ä
engine subject to this part’s provisions, you restore it to proper functioning as revising paragraph (c) and adding Ä
unless the engine has a valid and soon as possible. introductory text to read as follows:Ä
appropriate certificate of conformity and (iii) You modify a new engine that
the required engine label or tag. For another manufacturer has already § 1068.105 What other provisions apply to
purposes of this paragraph (a)(1), an certified to meet emission standards and me specifically if I manufacture equipment
appropriate certificate of conformity is recertify it under your own engine needing certified engines?
one that applies for the same model year family. In this case you must tell the This section describes general
as the model year of the equipment original manufacturer not to include the provisions that apply to equipment
(except as allowed by § 1068.105(a)), modified engines in the original engine manufacturers. See the standard-setting
covers the appropriate category of family. part for any requirements that apply for
engines (such as locomotive or CI (2) Defeat devices. You may not certain applications.
marine), and conforms to all knowingly manufacture, sell, offer to * * * * *
requirements specified for equipment in sell, or install, an engine part if it (c) Attaching a duplicate label. If you
the standard-setting part. The bypasses, impairs, defeats, or disables obscure the engine’s label, you must do
requirements of this paragraph (a)(1) the engine’s control the emissions of four things to avoid violating
also cover new engines you produce to any pollutant. We may assess a civil § 1068.101(a)(1):
replace an older engine in a piece of penalty up to $3,150 for each part in (1) Send a request for duplicate labels
equipment, unless the engine qualifies violation. in writing with your company’s
for the replacement-engine exemption (3) Stationary engines. For an engine letterhead to the engine manufacturer.
in § 1068.240. We may assess a civil that is excluded from any requirements Include the following information in
penalty up to $31,500 for each engine in of this chapter because it is a stationary your request:
violation. engine, you may not move it or install (i) Identify the type of equipment and
(2) Reporting and recordkeeping. This it in any mobile equipment, except as the specific engine and equipment
chapter requires you to record certain allowed by the provisions of this models needing duplicate labels.
types of information to show that you chapter. You may not circumvent or (ii) Identify the engine family (from
meet our standards. You must comply attempt to circumvent the residence- the original engine label).
(iii) State the reason that you need a owners may make warranty claims according to the original manufacturer’s Ä
duplicate label for each equipment against the manufacturer for emission- recommended practice. In particular, Ä
model. related parts, as described in § 1068.115. replace oxygen sensors, replace the Ä
(iii) Identify the number of duplicate The warranty period begins when the catalyst if there is evidence of Ä
labels you will need. engine is first placed into service. See malfunction, clean gaseous fuel system Ä
(2) Permanently attach the duplicate the standard-setting part for specific components, and replace fuel injectors Ä
label to your equipment by securing it requirements. It is a violation of the Act (if applicable), unless you have a Ä
to a part needed for normal operation for anyone to disable emission controls; reasonable technical basis for believing Ä
and not normally requiring replacement. see § 1068.101(b)(1) and the standard- any of these components do not need Ä
Make sure an average person can easily setting part. replacement.Ä
read it. ■ 119. Section 1068.120 is amended by
* * * * *Ä
(3) Destroy any unused duplicate revising paragraphs (b)(2), (c), (d), (f), ■ 120. Section 1068.125 is amended by Ä
labels if you find that you will not need and (h) to read as follows: revising paragraphs (a)(1)(iv), (b)(3), and Ä
them. (e)(2) to read as follows:Ä
(4) Keep the following records for at § 1068.120 What requirements must I
follow to rebuild engines?
least eight years after the end of the § 1068.125 What happens if I violate the
model year identified on the engine * * * * * regulations?
label: (b) * * *
(2) Unscheduled maintenance that (a) * * *
(i) Keep a copy of your written (1) * * *
request. occurs commonly within the useful life
period. For example, replacing a water (iv) Your history of compliance with
(ii) Keep drawings or descriptions that Title II of the Act (42 U.S.C. 7401–7590).
show how you apply the duplicate pump is not rebuilding an engine.
(c) For maintenance or service that is * * * * *
labels to your equipment.
not rebuilding, you may not make (b) * * *
(iii) Maintain a count of those
changes that might increase emissions (3) We will not pursue an
duplicate labels you use and those you
of any pollutant, but you do not need to administrative penalty for a particular
destroy.
keep any records. violation if either of the following two
* * * * *Ä (d) If you rebuild an engine or engine conditions is true:
system, you must have a reasonable (i) We are separately prosecuting the
revising paragraphs (b), (c), (d), and (e) Ä technical basis for knowing that the violation under this subpart.
to read as follows:Ä rebuilt engine’s emission-control system (ii) We have issued a final order for
§ 1068.110 What other provisions apply to performs as well as, or better than, it a violation, no longer subject to judicial
engines in service? performs in its certified configuration. review, for which you have already paid
* * * * * Identify the model year of the resulting a penalty.
(b) Certifying aftermarket parts. As engine configuration. You have a * * * * *
the manufacturer or rebuilder of an reasonable basis if you meet two main (e) * * *
aftermarket engine part, you may—but conditions: (2) In addition, if you do not pay the
are not required to—certify according to (1) Install parts—new, used, or full amount of a penalty on time, you
§ 85.2114 of this chapter that using the rebuilt—so a person familiar with must then pay more to cover interest,
part will not cause engines to fail to engine design and function would enforcement expenses (including
meet emission standards. Whether you reasonably believe that the engine with attorney’s fees and costs for collection),
certify or not, you must keep any those parts will control emissions of all and a quarterly nonpayment penalty for
information showing how your parts or pollutants at least to the same degree as each quarter you do not pay. The
service affect emissions. with the original parts. For example, it quarterly nonpayment penalty is 10
(c) Compliance with standards. We would be reasonable to believe that percent of your total penalties plus any
may test engines and equipment to parts performing the same function as unpaid nonpayment penalties from
investigate compliance with emission the original parts (and to the same previous quarters.
standards and other requirements. We degree) would control emissions to the ■ 121. Section 1068.201 is amended by
may also require the manufacturer to do same degree as the original parts. revising the introductory text and
this testing. (2) Adjust parameters or change paragraph (i) to read as follows:
(d) Defeat devices. We may test design elements only according to the
engines and equipment to investigate original engine manufacturer’s § 1068.201 Does EPA exempt or exclude
instructions. Or, if you differ from these any engines from the prohibited acts?
potential defeat devices. We may also
require the manufacturer to do this instructions, you must have data or We may exempt new engines from
testing. If we choose to investigate one some other technical basis to show you some or all of the prohibited acts or
of your designs, we may require you to should not expect in-use emissions to requirements of this part under
show us that it does not have a defeat increase. provisions described in this subpart. We
device. To do this, you may have to * * * * * may exempt an engine already placed in
share with us information regarding test (f) If the rebuilt engine replaces service in the United States from the
programs, engineering evaluations, another certified engine in a piece of prohibition in § 1068.101(b)(1) if the
design specifications, calibrations, on- equipment, you must rebuild it to a exemption for engines used solely for
board computer algorithms, and design certified configuration of the same competition applies (see § 1068.235). In
strategies. It is a violation of the Act for model year as, or a later model year addition, see § 1068.1 and the standard-
anyone to make, install or use defeat than, the engine you are replacing. setting parts to determine if other
devices. See § 1068.101(b)(2) and the * * * * * engines are excluded from some or all
standard-setting part. (h) When you rebuild an engine, of the regulations in this chapter.
(e) Warranty and maintenance. check, clean, adjust, repair, or replace * * * * *
Owners are responsible for properly all emission-related components (listed (i) If you want to take an action with
maintaining their engines; however, in Appendix I of this part) as needed respect to an exempted or excluded
engine that is prohibited by the Ä (b) A nonconforming display engine you loan, lease, sell, or give one of these
exemption or exclusion, such as selling Ä will be exempted if it is used only for engines to someone else, you must tell
it, you need to certify the engine. We Ä displays in the interest of a business or the new owner (or operator, if
will issue a certificate of conformity if Ä the general public. This exemption does applicable) in writing that it may be
you send us an application for Ä not apply to engines displayed for used only for competition.
certification showing that you meet all Ä private use, private collections, or any ■ 128. Section 1068.240 is revised to
the applicable requirements from the Ä other purpose we determine is read as follows:
standard-setting part. Also, in some Ä inappropriate for a display exemption.
§ 1068.240 What are the provisions for
cases, we may allow manufacturers to Ä * * * * * exempting new replacement engines?
modify the engine as needed to make it Ä (e) * * * (a) You are eligible for the exemption
identical to engines already covered by Ä (3) Engine displacement, engine for new replacement engines only if you
a certificate. We would base such an Ä family identification (as applicable), and are a certificate holder.
approval on our review of any Ä model year of the engine or whom to (b) The prohibitions in
appropriate documentation. These Ä contact for further information. § 1068.101(a)(1) do not apply to an
engines must have emission control Ä * * * * *Ä engine if all the following conditions
information labels that accurately Ä ■ 125. Section 1068.225 is amended by Ä apply:
describe their status.Ä adding paragraph (d) to read as follows:Ä (1) You produce a new engine to
■ 122. Section 1068.210 is amended by Ä replace an engine already placed in
revising paragraphs (d)(5)(iv) and Ä § 1068.225 What are the provisions for service in a piece of equipment.
(e)(3)(iv) to read as follows:Ä exempting engines for national security? (2) The engine being replaced was
* * * * * manufactured before the emission
exempting test engines? (d) Add a legible label, written in standards that would otherwise apply to
block letters in English, to each engine the new engine took effect.
* * * * * exempted under this section. The label (3) You determine that you do not
(d) * * *
(5) * * * must be permanently secured to a produce an engine certified to meet
(iv) Ownership and control of the readily visible part of the engine needed current requirements that has the
engines involved in the test. for normal operation and not normally appropriate physical or performance
(e) * * * requiring replacement, such as the characteristics to repower the
(3) * * * engine block. This label must include at equipment. If the engine being replaced
(iv) The statement ‘‘THIS ENGINE IS least the following items: was made by a different company, you
EXEMPT UNDER 40 CFR 1068.210 OR (1) The label heading ‘‘EMISSION must make this determination also for
1068.215 FROM EMISSION CONTROL INFORMATION’’. engines produced by this other
STANDARDS AND RELATED (2) Your corporate name and company.
REQUIREMENTS.’’. trademark. (4) You or your agent takes possession
* * * * *Ä (3) Engine displacement, engine of the old engine or confirms that the
■ 123. Section 1068.215 is amended by Ä family identification (as applicable), and engine has been destroyed.
revising paragraphs (b), (c)(3)(iii), and Ä model year of the engine or whom to (5) You make the replacement engine
(c)(3)(iv) to read as follows:Ä contact for further information. in a configuration identical in all
(4) The statement ‘‘THIS ENGINE material respects to the engine being
§ 1068.215 What are the provisions for HAS AN EXEMPTION FOR NATIONAL replaced (or that of another certified
exempting manufacturer-owned engines? SECURITY UNDER 40 CFR 1068.225.’’. engine of the same or later model year).
* * * * * ■ 126. Section 1068.230 is amended by This requirement applies only if the old
(b) An engine may be exempt without revising paragraph (c) to read as follows: engine was certified to emission
a request if it is a nonconforming engine standards less stringent than those in
under your ownership and control and § 1068.230 What are the provisions for effect when you produce the
exempting engines for export?
you operate it to develop products, replacement engine.
assess production methods, or promote * * * * * (c) If the engine being replaced was
your engines in the marketplace. You (c) Label each exempted engine and not certified to any emission standards
may not loan, lease, sell, or use the shipping container with a label or tag under this chapter, add a permanent
engine to generate revenue, either by showing the engine is not certified for label with your corporate name and
itself or in a piece of equipment. sale or use in the United States. These trademark and the following language:
(c) * * * labels need not be permanently attached
THIS ENGINE DOES NOT COMPLY WITH
(3) * * * to the engines. The label must include U.S. EPA NONROAD EMISSION
(iii) Engine displacement, engine at least the statement ‘‘THIS ENGINE IS REQUIREMENTS. SELLING OR
family identification (as applicable), and SOLELY FOR EXPORT AND IS INSTALLING THIS ENGINE FOR ANY
model year of the engine or whom to THEREFORE EXEMPT UNDER 40 CFR PURPOSE OTHER THAN TO REPLACE A
contact for further information. 1068.230 FROM U.S. EMISSION NONROAD ENGINE BUILT BEFORE
(iv) The statement ‘‘THIS ENGINE IS STANDARDS AND RELATED JANUARY 1, [Insert appropriate year
EXEMPT UNDER 40 CFR 1068.210 OR REQUIREMENTS.’’. reflecting when the earliest tier of standards
began to apply to engines of that size and
1068.215 FROM EMISSION ■ 127. Section 1068.235 is amended by
type] MAY BE A VIOLATION OF FEDERAL
STANDARDS AND RELATED revising paragraph (c) to read as follows: LAW SUBJECT TO CIVIL PENALTY.
REQUIREMENTS.’’.
■ 124. Section 1068.220 is amended by § 1068.235 What are the provisions for (d) If the engine being replaced was
revising paragraphs (b) and (e)(3) to read exempting engines used solely for certified to emission standards less
competition? stringent than those in effect when you
as follows:
* * * * * produce the replacement engine, add a
§ 1068.220 What are the provisions for (c) If you modify an engine under permanent label with your corporate
exempting display engines? paragraph (b) of this section, you must name and trademark and the following
* * * * * destroy the original emission label. If language:
THIS ENGINE DOES NOT COMPLY WITH § 1068.255 What are the provisions for each engine they purchase from you,
U.S. EPA NONROAD EMISSION exempting engines for hardship for your distributors, or your dealers under
REQUIREMENTS. SELLING OR equipment manufacturers and secondary this section.
INSTALLING THIS ENGINE FOR ANY engine manufacturers?
PURPOSE OTHER THAN TO REPLACE A (ii) If you sell more than 50 engines
* * * * * per model year under this section, you
NONROAD ENGINE BUILT BEFORE
JANUARY 1, [Insert appropriate year
(c) Secondary engine manufacturers. must annually audit four equipment
reflecting when the next tier of emission As a secondary engine manufacturer, manufacturers to whom you sell engines
standards began to apply] MAY BE A you may ask for approval to produce under this section. To select individual
VIOLATION OF FEDERAL LAW SUBJECT exempted engines under this section for equipment manufacturers, divide all the
TO CIVIL PENALTY. up to 12 months. We may require you affected equipment manufacturers into
(e) The provisions of this section may to certify your engines to compliance quartiles based on the number of
not be used to circumvent emission levels above the emission standards that engines they buy from you; select a
standards that apply to new engines apply. For example, the in the case of single equipment manufacturer from
under the standard-setting part. multiple tiers of emission standards, we each quartile each model year. Vary the
■ 129. Section 1068.245 is amended by may require you to meet the standards equipment manufacturers you audit
revising paragraphs (a) introductory text from the previous tier. from year to year, though you may
and (e) to read as follows: * * * * *Ä repeat an audit in a later model year if
■ 132. A new § 1068.260 is added to Ä you find or suspect that a particular
§ 1068.245 What temporary provisions
address hardship due to unusual
subpart C to read as follows:Ä equipment manufacturer is not properly
circumstances? installing aftertreatment devices. If you
(a) After considering the temporarily exempting engines for sell engines to fewer than 16 equipment
circumstances, we may permit you to delegated final assembly? manufacturers under the provisions of
introduce into commerce engines or this section, you may instead set up a
(a) Shipping an engine separately
equipment that do not comply with plan to audit each equipment
from an aftertreatment component that
emission-related requirements for a manufacturer on average once every
you have specified as part of its certified
limited time if all the following four model years. Audits must involve
configuration will not be a violation of
conditions apply: the assembling companies’ facilities,
the prohibitions in § 1068.101(a)(1), if
procedures, and production records to
* * * * * you do all the following:
(e) We may include reasonable (1) Apply for and receive a certificate monitor their compliance with your
additional conditions on an approval of conformity for the engine and its instructions, must include investigation
granted under this section, including emission-control system before of some assembled engines, and must
provisions to recover or otherwise shipment. confirm that the number of
address the lost environmental benefit (2) Provide installation instructions in aftertreatment devices shipped were
or paying fees to offset any economic enough detail to ensure that the engine sufficient for the number of engines
gain resulting from the exemption. For will be in its certified configuration if produced. Where an equipment
example, in the case of multiple tiers of someone follows these instructions. manufacturer is not located in the
emission standards, we may require that (3) Have a contractual agreement with United States, you may conduct the
you meet the standards from the an equipment manufacturer obligating audit at a distribution or port facility in
previous tier. the equipment manufacturer to the United States. You must keep
complete the final assembly of the records of these audits and provide a
* * * * *Ä report describing any uninstalled or
■ 130. Section 1068.250 is amended by Ä engine so it is in its certified
configuration when installed in the improperly installed aftertreatment
revising paragraphs (d)(2), (d)(4), and (j) Ä
equipment. This agreement must also components to us within 90 days of the
to read as follows:Ä
obligate the equipment manufacturer to audit.
§ 1068.250 What are the provisions for provide the affidavits and cooperate (iii) If you sell up to 50 engines per
extending compliance deadlines for small- with the audits required under model year under this section, you must
volume manufacturers under hardship? conduct audits as described in
paragraph (a)(6) of this section.
* * * * * (4) Include the cost of all paragraph (a)(6)(ii) of this section or
(d) * * * aftertreatment components in the cost of propose an alternative plan for ensuring
(2) Describe your current and the engine. that equipment manufacturers properly
projected financial status, with and (5) Ship the aftertreatment install aftertreatment devices.
without the burden of complying fully components directly to the equipment (7) Describe the following things in
with the applicable regulations in this manufacturer, or arrange for separate your application for certification:
chapter. shipment by the component (i) How you plan to use the provisions
* * * * * manufacturer directly to the equipment of this section.
(4) Identify the engineering and manufacturer. (ii) A detailed plan for auditing
technical steps you have taken or those (6) Take appropriate additional steps equipment manufacturers, as described
you plan to take to comply with to ensure that all engines will be in their in paragraph (a)(6) of this section.
regulations in this chapter. certified configuration when installed (iii) All other steps you plan to take
* * * * * by the equipment manufacturer. At a under paragraph (a)(6) of this section.
(j) We will approve extensions of up minimum do the following: (8) Keep records to document how
to one model year. We may review and (i) Obtain annual affidavits from every many engines you produce under this
revise an extension as reasonable under equipment manufacturer to whom you, exemption. Also, keep records to
the circumstances. your distributors, or your dealers sell document your contractual agreements
* * * * *Ä engines under this section. The under paragraph (a)(3) of this section.
■ 131. Section 1068.255 is amended by Ä affidavits must list the part numbers of Keep all these records for five years after
revising paragraph (c) introductory text Ä the aftertreatment devices that the end of the model year and make
to read as follows:Ä equipment manufacturers install on them available to us upon request.
(9) Make sure the engine has the § 1068.305 How do I get an exemption or imports under § 1039.301(b) under the
emission control information label we exclusion for imported engines? following conditions:
require under the standard-setting part. (a) Complete the appropriate EPA (a) National security exemption. You
Apply an additional temporary label or declaration form before importing any may import an engine under the
tag in a way that makes it unlikely that nonconforming engine. These forms are national security exemption in
the engine will be installed in available on the Internet at http:// § 1068.225, but only if it is properly
equipment other than in its certified www.epa.gov/OTAQ/imports/ or by labeled.
configuration. The label or tag must phone at 202–564–9660. * * * * *
identify the engine as incomplete and * * * * * (f) * * *
include a clear statement that failing to (e) Meet the requirements specified (1) * * *
install the aftertreatment device, or for the appropriate exemption in this (iii) Land-based nonroad diesel
otherwise bring the engine into its part or the standard-setting part, engines (see part 1039 of this chapter).
certified configuration, is a violation of including any labeling requirements * * * * *Ä
federal law subject to civil penalty. that apply. ■ 136. Section 1068.320 is amended by Ä
■ 134. Section 1068.310 is revised to
revising the section heading and Ä
(b) An engine you produce under this
read as follows: paragraphs (a) introductory text and (b) Ä
section becomes new when it is fully
to read as follows:Ä
assembled, except for aftertreatment
§ 1068.310 What are the exclusions for
devices, for the first time. Use this date imported engines? § 1068.320 How must I label an imported
to determine the engine’s model year. engine with an exclusion or a permanent
If you show us that your engines exemption?
(c) Once the equipment manufacturer qualify under one of the paragraphs of
takes possession of an engine exempted (a) For engines imported under
this section, we will approve your § 1068.310(a) or (b), you must place a
under this section, the exemption request to import such excluded
expires and the engine is subject to all permanent label or tag on each engine.
engines. You must have our approval to If no specific label requirements in the
the prohibitions in 40 CFR 1068.101. import an engine under paragraph (a) of standard-setting part apply for these
(d) You must notify us within 15 days this section. You may, but are not engines, you must meet the following
if you find from an audit or another required to request our approval to requirements:
source that an equipment manufacturer import the engines under paragraph (b)
or (c) of this section. The following * * * * *
has failed to meet its obligations under (b) On the engine label or tag, do the
this section. engines are excluded:
following:
(e) We may suspend, revoke, or void (a) Engines used solely for (1) Include the heading ‘‘EMISSION
an exemption under this section, as competition. Engines that you CONTROL INFORMATION’’.
follows: demonstrate will be used solely for (2) Include your full corporate name
competition are excluded from the and trademark.
(1) We may suspend or revoke your restrictions on imports in § 1068.301(b), (3) State the engine displacement (in
exemption for the entire engine family but only if they are properly labeled. liters) and rated power. If the engine’s
if we determine that any of the engines See the standard-setting part for rated power is not established, state the
are not in their certified configuration provisions related to this demonstration. approximate power rating accurately
after installation in the equipment, or if Section 1068.101(b)(4) prohibits anyone enough to allow a determination of
you fail to comply with the from using these excluded engines for which standards would otherwise
requirements of this section. If we purposes other than competition. apply.
suspend or revoke the exemption for (b) Stationary engines. The definition (4) State: ‘‘THIS ENGINE IS EXEMPT
any of your engine families under this of nonroad engine in 40 CFR 1068.30 FROM THE REQUIREMENTS OF
paragraph (d), this exemption will not does not include certain engines used in [identify the part referenced in 40 CFR
apply for future certificates unless you stationary applications. Such engines 1068.1(a) that would otherwise apply],
demonstrate that the factors causing the are not subject to the restrictions on AS PROVIDED IN [identify the
nonconformity do not apply to the other imports in § 1068.301(b), but only if paragraph authorizing the exemption
engine families. We may suspend or they are properly labeled. Section (for example, ‘‘40 CFR 1068.315(a)’’)].
revoke the exemption for shipments to 1068.101 restricts the use of stationary INSTALLING THIS ENGINE IN ANY
a single facility where final assembly engines for non-stationary purposes. DIFFERENT APPLICATION MAY BE A
occurs. (c) Other engines. The standard- VIOLATION OF FEDERAL LAW
(2) We may void your exemption for setting parts may exclude engines used SUBJECT TO CIVIL PENALTY.’’.
the entire engine family if you in certain applications. For example, * * * * *Ä
intentionally submit false or incomplete engines used in aircraft and very small ■ 137. Section 1068.325 is amended by Ä
information or fail to keep and provide engines used in hobby vehicles are revising the introductory text and Ä
to EPA the records required by this generally excluded. Engines used in paragraphs (a) and (b) and adding Ä
section. underground mining are excluded if paragraph (f) to read as follows:Ä
(f) You are liable for the in-use they are regulated by the Mine Safety
and Health Administration. § 1068.325 What are the temporary
compliance of any engine that is exempt exemptions for imported engines?
under this section. It is also a violation If we approve a temporary exemption
of § 1068.101(b)(1) for any person to revising the introductory text and
paragraph (a) and adding paragraph from the restrictions on importing an
complete assembly of the exempted engine under § 1039.301(b), you may
engine without complying fully with the (f)(1)(iii) to read as follows:
import it under the conditions in this
installation instructions. § 1068.315 What are the permanent section. We may ask the U.S. Customs
■ 133. Section 1068.305 is amended by exemptions for imported engines? Service to require a specific bond
revising paragraphs (a) and (e) to read as We may approve a permanent amount to make sure you comply with
follows: exemption from the restrictions on the requirements of this subpart. You
may not sell or lease one of these (c) If we select one or more of your holidays. You may ask us to approve a
engines while it is in the United States. engine families for a selective lower service accumulation rate. Plan
You must eventually export the engine enforcement audit, we will send the test your service accumulation to allow
as we describe in this section unless you order to the person who signed the testing at the rate specified in paragraph
get a certificate of conformity for it or application for certification or we will (c) of this section. Select engine
it qualifies for one of the permanent deliver it in person. operation for accumulating operating
exemptions in § 1068.315. Section (d) If we do not select a testing hours on your test engines to represent
1068.330 specifies an additional facility, notify the Designated Officer normal in-use engine operation for the
temporary exemption allowing you to within one working day of receiving the engine family.
import certain engines you intend to sell test order where you will test your (e) Test engines in the same order you
or lease. engines. select them.
(a) Exemption for repairs or (e) You must do everything we require ■ 142. Section 1068.445 is amended by
alterations. You may temporarily import in the audit without delay. revising paragraph (a)(1) to read as
a nonconforming engine under bond ■ 140. Section 1068.410 is amended by follows:
solely to repair or alter it or the revising paragraphs (e)(1), (g), and (i) to
equipment in which it is installed. You read as follows: § 1068.445 When may EPA revoke my
certificate under this subpart and how may
may operate the engine and equipment § 1068.410 How must I select and prepare I sell these engines again?
in the United States only as necessary my engines?
to repair it, alter it, or ship it to or from (a) * * *
* * * * * (1) You do not meet the reporting
the service location. Export the engine
(e) * * * requirements under this subpart.
directly after servicing is complete. (1) We may adjust or require you to
(b) Testing exemption. You may * * * * *Ä
adjust idle speed outside the physically
temporarily import a nonconforming ■ 143. Section 1068.450 is amended by Ä
adjustable range as needed until the
engine under bond for testing if you revising paragraph (e) to read as follows:Ä
engine has stabilized emission levels
follow the requirements of § 1068.210.
(see paragraph (f) of this section). We § 1068.450 What records must I send to
You may operate the engine in the
may ask you for information needed to EPA?
United States only to allow testing. This
establish an alternate minimum idle * * * * *
exemption expires one year after you
speed. (e) We may post test results on
import the engine, unless we approve an
extension. The engine must be exported * * * * * publicly accessible databases and we
before the exemption expires. (g) Damage during shipment. If will send copies of your reports to
shipping an engine to a remote facility anyone from the public who asks for
* * * * * for testing under a selective enforcement them. We will not release information
(f) Delegated assembly exemption.
audit makes necessary an adjustment or about your sales or production volumes,
You may import a nonconforming
repair, you must wait until after the which is all we will consider
engine for final assembly, as described
initial emission test to do this work. We confidential.
in § 1068.260.
may waive this requirement if the test ■ 144. Section 1068.501 is revised to
would be impossible or unsafe, or if it read as follows:
revising paragraph (a) to read as follows:
would permanently damage the engine.
§ 1068.335 What are the penalties for Report to us, in your written report § 1068.501 How do I report engine
defects?
violations? under § 1068.450, all adjustments or
(a) All imported engines. Unless you repairs you make on test engines before This section addresses your
comply with the provisions of this each test. responsibility to investigate and report
subpart, importation of nonconforming * * * * * emission-related defects in design,
engines violates sections 203 and 213(d) (i) Retesting after invalid tests. You materials, or workmanship. The
of the Act (42 U.S.C. 7522 and 7547(d)). may retest an engine if you determine provisions of this section do not limit
You may then have to export the an emission test is invalid under the your liability under this part or the
engines, or pay civil penalties, or both. standard-setting part. Explain in your Clean Air Act. For example, selling an
The U.S. Customs Service may seize written report reasons for invalidating engine that does not conform to your
unlawfully imported engines. any test and the emission results from application for certification is a
all tests. If you retest an engine and, violation of § 1068.101(a)(1),
* * * * *
■ 139. Section 1068.401 is revised to within ten days after testing, ask to independent of the requirements of this
read as follows: substitute results of the new tests for the section.
original ones, we will answer within ten (a) General provisions. As an engine
§ 1068.401 What is a selective days after we receive your information. manufacturer, you must investigate in
enforcement audit? ■ 141. Section 1068.415 is amended by certain circumstances whether engines
(a) We may conduct or require you to revising paragraphs (d) and (e) to read as that have been introduced into
conduct emission tests on your follows: commerce in the United States have
production engines in a selective incorrect, improperly installed, or
enforcement audit. This requirement is § 1068.415 How do I test my engines? otherwise defective emission-related
independent of any requirement for you * * * * * components or systems. You must also
to routinely test production-line (d) Accumulate service on test send us reports as specified by this
engines. engines at a minimum rate of 6 hours section.
(b) If we send you a signed test order, per engine during each 24-hour period. (1) This section addresses defects for
you must follow its directions and the The first 24-hour period for service any of the following emission-related
provisions of this subpart. We may tell accumulation begins when you finish components, or systems containing the
you where to test the engines. This may preparing an engine for testing. The following components:
be where you produce the engines or minimum service accumulation rate (i) Electronic control units,
any other emission testing facility. does not apply on weekends or aftertreatment devices, fuel-metering
components, EGR-system components, (7) If we determine that emission- that there is no emission-related defect
crankcase-ventilation valves, all related defects result in a substantial or you obtain all the information
components related to charge-air number of properly maintained and specified for a defect report in
compression and cooling, and all used engines not conforming to the paragraph (d) of this section. Send us an
sensors associated with any of these regulations of this chapter during their updated defect report anytime you have
components. useful life, we may order you to conduct significant additional information.
(ii) Any other component whose a recall of your engines (see § 1068.505). (6) If a component with a possible
primary purpose is to reduce emissions. (8) Send all reports required by this defect is used in additional engine
(iii) Any other component whose section to the Designated Officer. families or model years, you must
failure might increase emissions of any (9) This section distinguishes between investigate whether the component may
pollutant without significantly defects and possible defects. A possible be defective when used in these
degrading engine performance. defect exists anytime there is an additional engine families or model
(2) The requirements of this section indication that an emission-related years, and include these results in any
relate to defects in any of the component or system might have a defect report you send under paragraph
components or systems identified in defect, as described in paragraph (b)(1) (c) of this section.
paragraph (a)(1) of this section if the of this section. (7) If your initial investigation
defects might affect any of the (b) Investigation of possible defects. concludes that the number of engines
parameters or specifications in Investigate possible defects as follows: with a defect is fewer than any of the
Appendix II of this part or might (1) If the number of engines that have thresholds specified in paragraph (f) of
otherwise affect an engine’s emissions a possible defect, as defined by this this section, but other information later
of any pollutant. paragraph (b)(1), exceeds a threshold becomes available that may show that
(3) For the purposes of this section, specified in paragraph (e) of this the number of engines with a defect
defects do not include damage to section, you must conduct an exceeds a threshold, then you must
emission-related components or systems investigation to determine if an resume your investigation. If you
(or maladjustment of parameters) caused emission-related component or system resume an investigation, you must
by owners improperly maintaining or is actually defective. You must classify include the information from the earlier
abusing their engines. an engine component or system as investigation to determine whether to
having a possible defect if any of the send a defect report.
(4) The requirements of this section
following sources of information shows (c) Reporting defects. You must send
do not apply to emission control
there is a significant possibility that a us a defect report in either of the
information labels. Note however, that
defect exists: following cases:
§ 1068.101(a)(1) prohibits the sale of
(i) A warranty claim is submitted for (1) Your investigation shows that the
engines without proper labels, which
the component, whether this is under number of engines with a defect exceeds
also applies to misprinted labels.
your emission-related warranty or any a threshold specified in paragraph (f) of
(5) You must track the information other warranty. this section. Send the defect report
specified in paragraph (b)(1) of this (ii) Your quality-assurance procedures within 21 days after the date you
section. You must assess this data at suggest that a defect may exist. identify this number of defective
least every three months to evaluate (iii) You receive any other engines. See paragraph (h) of this
whether you exceed the thresholds information for which good engineering section for reporting requirements that
specified in paragraphs (e) and (f) of this judgment would indicate the apply if the number of engines with a
section. Where thresholds are based on component or system may be defective, defect does not exceed any of the
a percentage of engines in the engine such as information from dealers, field- thresholds in paragraph (f) of this
family, use actual sales figures for the service personnel, hotline complaints, section.
whole model year when they become or engine diagnostic systems. (2) You know there are emission-
available. Use projected sales figures (2) If the number of shipped related defects for a component or
until the actual sales figures become replacement parts for any individual system in a number of engines that
available. You are not required to collect component is high enough that good exceeds a threshold specified in
additional information other than that engineering judgment would indicate a paragraph (f) of this section, regardless
specified in paragraph (b)(1) of this significant possibility that a defect of how you obtain this information.
section before reaching a threshold for exists, you must conduct an Send the defect report within 21 days
an investigation specified in paragraph investigation to determine if it is after you learn that the number of
(e) of this section. actually defective. Note that this defects exceeds a threshold.
(6) You may ask us to allow you to paragraph (b)(2) does not require data- (d) Contents of a defect report.
use alternate methods for tracking, tracking or recording provisions related Include the following information in a
investigating, reporting, and correcting to shipment of replacement parts. defect report:
emission-related defects. In your (3) Your investigation must be (1) Your corporate name and a person
request, explain and demonstrate why prompt, thorough, consider all relevant to contact regarding this defect.
you believe your alternate system will information, follow accepted scientific (2) A description of the defect,
be at least as effective in the aggregate and engineering principles, and be including a summary of any engineering
in tracking, identifying, investigating, designed to obtain all the information analyses and associated data, if
evaluating, reporting, and correcting specified in paragraph (d) of this available.
potential and actual emissions-related section. (3) A description of the engines that
defects as the requirements in this (4) Your investigation needs to have the defect, including engine
section. In this case, provide all consider possible defects that occur families, models, and range of
available data necessary to demonstrate only within the useful life period, or production dates.
why an alternate system is appropriate within five years after the end of the (4) An estimate of the number and
for your engines and how it will result model year, whichever is longer. percentage of each class or category of
in a system at least as effective as that (5) You must continue your affected engines that have the defect,
required under this section. investigation until you are able to show and an explanation of how you
determined this number. Describe any and engine family as much as possible. the status of the investigation. Send
statistical methods you used under If information is not identifiable by these status reports no later than June 30
paragraph (g)(6) of this section. model year or engine family, use good and December 31 of each year.
(5) An estimate of the defect’s impact engineering judgment to evaluate (2) If you find that the number of
on emissions, with an explanation of whether you exceed a threshold in components or systems with an
how you calculated this estimate and a paragraph (e) or (f) of this section. emission-related defect exceeds a
summary of any emission data Consider only your U.S.-directed threshold specified in paragraph (f) of
demonstrating the impact of the defect, production volume. this section, send us a report describing
if available. (2) Within an engine family, track your findings within 21 days after the
(6) A description of your plan for defects together for all components or date you reach this conclusion.
addressing the defect or an explanation systems that are the same in all material (3) If you find that the number of
of your reasons for not believing the respects. If multiple companies components or systems with an
defects must be addressed. separately supply a particular emission-related defect does not exceed
(e) Thresholds for conducting a defect component or system, treat each any of the thresholds specified in
investigation. You must begin a defect company’s component or system as paragraph (f) of this section, send us a
investigation based on the following unique. final report supporting this conclusion.
number of engines that may have the (3) If a possible defect is not attributed For example, you may exclude warranty
defect: to any specific part of the engine, claims that resulted from misdiagnosis
(1) For engines with maximum engine consider the complete engine a distinct and you may exclude defects caused by
power at or below 560 kW: component for evaluating whether you improper maintenance, improper use, or
(i) For engine families with annual exceed a threshold in paragraph (e) of misfueling. Send this report within 21
sales below 500 units: 50 or more this section. days after the date you reach this
engines. (4) If you correct defects before they conclusion.
(ii) For engine families with annual reach the ultimate purchaser as a result (i) Future production. If you identify
sales from 500 to 50,000 units: more of your quality-assurance procedures, a design or manufacturing defect that
than 10.0 percent of the total number of count these against the investigation prevents engines from meeting the
engines in the engine family. thresholds in paragraph (e) of this requirements of this part, you must
(iii) For engine families with annual section unless you routinely check correct the defect as soon as possible for
sales above 50,000 units: 5,000 or more every engine in the engine family. Do future production of engines in every
engines. not count any corrected defects as actual family affected by the defect. This
(2) For engines with maximum engine defects under paragraph (f) of this applies without regard to whether you
power greater than 560 kW: section. are required to conduct a defect
(i) For engine families with annual (5) Use aggregated data from all the investigation or submit a defect report
sales below 250 units: 25 or more different sources identified in paragraph under this section.
engines. (b)(1) of this section to determine ■ 145. Section 1068.505 is amended by
(ii) For engine families with annual whether you exceed a threshold in revising paragraphs (a) and (e) and
sales at or above 250 units: more than paragraphs (e) and (f) of this section. adding paragraph (f) to read as follows:
10.0 percent of the total number of (6) If information is readily available
to conclude that the possible defects § 1068.505 How does the recall program
engines in the engine family.
identified in paragraph (b)(1) of this work?
(f) Thresholds for filing a defect
report. You must send a defect report section are actual defects, count these (a) If we make a determination that a
based on the following number of toward the reporting thresholds in substantial number of properly
engines that have the defect: paragraph (f) of this section. maintained and used engines do not
(1) For engines with maximum engine (7) During an investigation, use conform to the regulations of this
power at or below 560 kW: appropriate statistical methods to chapter during their useful life, you
(i) For engine families with annual project defect rates for engines that you must submit a plan to remedy the
sales below 1,000 units: 20 or more are not otherwise able to evaluate. For nonconformity of your engines. We will
engines. example, if 75 percent of the notify you of our determination in
(ii) For engine families with annual components replaced under warranty writing. Our notice will identify the
sales from 1,000 to 50,000 units: more are available for evaluation, it would be class or category of engines affected and
than 2.0 percent of the total number of appropriate to extrapolate known describe how we reached our
engines in the engine family. information on failure rates to the conclusion. If this happens, you must
(iii) For engine families with annual components that are unavailable for meet the requirements and follow the
sales above 50,000 units: 1,000 or more evaluation. Take steps as necessary to instructions in this subpart. You must
engines. prevent bias in sampled data. Make remedy at your expense noncompliant
(2) For engines with maximum engine adjusted calculations to take into engines that have been properly
power greater than 560 kW: account any bias that may remain. maintained and used, as described in
(i) For engine families with annual (h) Investigation reports. Once you § 1068.510(a)(7). You may not transfer
sales below 150 units: 10 or more trigger an investigation threshold under this expense to a dealer or equipment
engines. paragraph (e) of this section, you must manufacturer through a franchise or
(ii) For engine families with annual report your progress and conclusions. In other agreement.
sales from 150 to 750 units: 15 or more your reports, include the information * * * * *
engines. specified in paragraph (d) of this (e) You may ask us to allow you to
(iii) For engine families with annual section, or explain why the information conduct your recall differently than
sales above 750 units: more than 2.0 is not relevant. Send us the following specified in this subpart, consistent
percent of the total number of engines reports: with section 207(c) of the Act (42 U.S.C.
in the engine family. (1) While you are investigating, send 7541(c)).
(g) How to count defects. (1) Track us mid-year and end-of-year reports to (f) You may do a voluntary recall
defects separately for each model year describe the methods you are using and under § 1068.535, unless we have made
the determination described in Ä ■ 147. Section 1068.530 is amended by revising the introductory text to read as
§ 1068.535(a).Ä revising the introductory text to read as follows:
■ 146. Section 1068.510 is amended by Ä follows:
revising paragraph (a)(7) to read as Ä Appendix I to Part 1068—Emission-
follows:Ä § 1068.530 What records must I keep? Related Components
§ 1068.510 How do I prepare and apply my We may review your records at any This appendix specifies emission-
remedial plan? time, so it is important that you keep related components that we refer to for
(a) * * * required information readily available. describing such things as emission-
(7) The proper maintenance or use Keep records associated with your recall related warranty or requirements related
you will specify, if any, as a condition campaign for three years after you send
to rebuilding engines.
to be eligible for repair under the the last report we require under
§ 1068.525(b). Organize and maintain [FR Doc. 04–11293 Filed 6–28–04; 8:45 am]
remedial plan. Describe how these
specifications meet the provisions of your records as described in this BILLING CODE 6560–50–P
paragraph (e) of this section. Describe section.

how the owners should show they meet * * * * *
your conditions. ■ 148. Appendix I to part 1068 is
* * * * * amended by removing paragraph IV and

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Tuesday,

June 29, 2004

Industry ............................................. 333618 3519 Manufacturers of new nonroad diesel engines.

Industry ............................................. 333131 3532 Manufacturers of mining machinery and equipment.

a North American Industry Classification System (NAICS).

b Standard Industrial Classification (SIC) system code.

Reporting, and PTDs

H. Liability and Penalty Provisions for

I. How Will Compliance With the Sulfur

the Use of Low Sulfur Fuel

C. Engine and Equipment Cost Impacts

The official public docket is the F. Test Cycles

collection of materials that is available G. Other Test Procedure Issues

for public viewing at the Air Docket in H. Engine Power

Electronic Access. You may access Q. Highway Engines

R. Changes That Affect Other Engine

electronically through the EPA Internet Categories

Lubricity and Other Fuel Properties? F. Executive Order 13175: Consultation

atmospheric haze. of the proposed Rule to Reduce Interstate Transport

TABLE II.A–1.—TIER 4 PM STANDARDS (G/BHP-HR) AND SCHEDULE

hp 750 (kW > 560) ................................................................................... See table II.A–4

TABLE II.A–2.—TIER 4 NOX AND NMHC STANDARDS AND SCHEDULE

175 ≤ hp ≤ 750 (130 ≤ kW ≤ 560) ........................................................... 0.30 0.14 50 50 50 100

hp > 750 (kW > 560) ............................................................................... See table II.A–4

TABLE II.A–4.—TIER 4 STANDARDS FOR ENGINES OVER 750 HP (G/BHP-HR)

PM NOX NMHC PM NOX NMHC

Engines used in:

United States Environmental Protection Agency,

25 ≤ hp < 75 .............. 2013–2016 a ................................ b 40 Not applicable ............................. 0.22

(130 ≤ kW ≤ 560) .........................................................................................................................................

TABLE III.B–1.—FLEXIBILITY PERIODS FOR THE TIER 4 STANDARDS

25 ≤ hp < 75 ........................................................................................................................... 2008–2014 Tier 2 standards.

manufacturer may include equipment identical to the percent-of-production be included in an equipment

TABLE III.B–2.—R EQUIREMENTS FOR ENGINES

way as domestic equipment enforcement tool in order to ensure that

TABLE III.E–1.—A DD-ON LEVELS USED IN DETERMINING IN-USE STANDARDS

TABLE III.F–2.—S UMMARY OF STEADY-STATE TEST REQUIREMENTS

81 These three steady-state test cycles are similar

TABLE III.F–2.—S UMMARY OF STEADY-STATE TEST REQUIREMENTS—Continued

175 ≤ hp ≤ 750 (130 ≤ kW ≤ 560) ........................... applies .................................. NA c ...................................... applies b

c Testing procedures not applicable to this class of engines.

discussions (including Appendix ‘‘A’’ text) in the

≤750 hp .............................................................. less than 500: 50 ............................................. less than 1,000: 20

TABLE III.M–1.—P ROGRAM FOR EARLY INTRODUCTION OF CLEAN ENGINES

Early ..................................... 25–75 hp ........................... 0.02 g/bhp-hr PM .......................................................... 1.5-to-1

TABLE III.Q–1.—R EGULATORY CHANGES

Applicability to alcohol-fueled engines ....................................................................................................................... §§ 1039.101, 1039.107.

TABLE III.Q–1.—R EGULATORY CHANGES—Continued

Hearings ..................................................................................................................................................................... 40 CFR 1068 Subpart G.

15 ppm LM ................. June 1, 2012 ............. June 1, 2014.

continued sale of otherwise off-

Non-Small Refiners–NR fuel ................................................ .......... 500 500 500 15 15 15 15 15 15

exists to add a third grade of diesel fuel in an

170 1.44 ppm is equal to two times the precision

value of 0.72 ppm for 15 ppm diesel and 19.36 is

parent company has 50 percent or greater

TABLE VI.A– 2.— VOLUME OF NRLM FUEL AFFECTED BY TODAY’S RULE

Nonroad Locomotive and Total

2008 ................................................................................................................................. 8,406 0 3,454 0 11,860 0

2007– 2010 ....................................................................................................................... 36 0 0 0

TABLE VI.A– 4.— AVERAGE REFINING COSTS BY REGION

500 ppm Cap 15 ppm Cap