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May 20, 2020
EPA proposes streamlined gasoline regulations

The EPA is proposing a major reorganization of its Clean Air Act (CAA) Fuels and Fuels Additive regulations (40 CFR Part 80). In the proposed revisions, the Agency says it seeks to adopt a holistic” approach that consolidates many different and overlapping regulations in Part 80 into a new Part 1090. The revisions “will better reflect how fuels, fuel additives, and regulated blendstocks are produced, distributed, and sold in today’s marketplace” and thereby reduce the burden the regulated community faces in complying with Part 80, says the EPA.

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Perhaps the major action under the proposal would be elimination of many of the regulatory differences between conventional gasoline (CG) and reformulated gasoline (RFG); the intent here is to minimize restrictions on commingling these two fuel types.

The proposed revisions potentially affect a wide range of industry sectors, including petroleum refineries and importers, manufacturers of gasoline additives, petroleum products pipelines, bulk petroleum storage, and natural gas production and distribution. The EPA estimates that the proposal would lower the annualized administrative cost savings to industry by $32.9 million. Other savings associated with improving the fungibility of fuel (i.e., by removing the distinctions between CG and RFG) and providing greater flexibility could potentially be even more significant but are more difficult to quantify, adds the EPA.

The Agency emphasizes that the action does not change the stringency of the existing fuel quality standards, although changes to certain provisions “may slightly, indirectly affect in-use fuel quality.”

Part 80

The Part 80 regulations establish standards for fuel parameters that directly or indirectly affect vehicle, engine, and equipment emissions, air quality, and public health. The standards address fuel additives and regulated blendstocks that are components of the fuels regulated under the part. Part 80 also specifies requirements for any person who engages in activities associated with the production, distribution, storage, and sale of fuels, fuel additives, and regulated blendstocks, such as collecting and testing samples for regulated parameters, reporting information to the EPA to demonstrate compliance with fuel quality requirements, and performing other compliance measures to implement the standards.

The EPA began planning the Part 80 revisions in 2018 when it held discussions with industry and other stakeholders. The Agency found that the compliance obligations imposed by Part 80 could be significantly improved by deleting expired provisions, consolidating and eliminating redundant provisions, and removing unnecessary and out-of-date requirements. The public was invited to comment on several discussion drafts of the regulatory changes that were released before publication of the current proposal.

Three objectives

According to the EPA, the following three considerations are paramount in the proposal.

  • Simplification of the RFG standards by removing restrictions that now create a distinction between CG and RFG, even though there is little, if any, difference between these two types of fuel. The RFG program was created by the EPA in the 1990s to ensure provision of cleaner-burning gasoline to the most polluted metropolitan areas of the country. Since that time, additional fuel quality standards and market changes have resulted in CG’s meeting or exceeding most of the performance requirements for RFG. The CAA still requires the use of RFG in certain nonattainment areas.
  • The standards for volatility, benzene, and sulfur would be treated similarly for RFG and CG. This would allow streamlining and consolidation of the compliance and enforcement provisions of the various Part 80 fuel quality programs into a single fuel quality program. Consolidation will improve consistency, remove duplication, and ultimately reduce the compliance burden for parties and the EPA. For example, the proposal would unify the various gasoline reporting requirements into a single, unified annual reporting requirement.
  • A streamlined fuel quality program would improve oversight of the EPA’s fuel quality programs. The Agency says it hopes to accomplish this by updating and improving the third-party oversight provisions already in use under Part 80. The proposal would consolidate the existing three in-use survey programs into a single national in-use fuel quality survey. This proposed program would help ensure that all fuels nationwide continue to meet EPA fuel quality standards when dispensed into vehicles and engines, not just at the refinery gate.

Slight changes

As noted, the EPA is not proposing to revise the fuel quality standards themselves, but the Agency says that consolidation, as proposed, “may slightly, indirectly affect in-use fuel quality.”

“For example, proposed changes to how parties record and report test results that fall below the test method’s lower limits of detection might cause parties to have to report slightly higher sulfur and benzene levels in gasoline, effectively improving in-use fuel quality by slightly decreasing the sulfur national annual average,” states the EPA.

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