[Federal Register Volume 60, Number 54 (Tuesday, March 21, 1995)]
[Notices]
[Pages 14936-14937]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 95-6924]
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ENVIRONMENTAL PROTECTION AGENCY
[FRL-5175-7]
Acid Rain Provisions
AGENCY: Environmental Protection Agency.
ACTION: Notice.
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SUMMARY: EPA announces extension of the April 1, 1994 and April 1, 1995
deadlines for small diesel refineries to request allowances under the
Acid Rain Program. These deadlines are extended to May 15, 1995. This
extension is warranted by confusion regarding small diesel refinery
eligibility for allowance allocations.
[[Page 14937]] FOR FURTHER INFORMATION CONTACT: Kathy Barylski, EPA
Acid Rain Division (6204J), 401 M Street., SW., Washington DC 20460;
telephone (202) 233-9074.
SUPPLEMENTARY INFORMATION:
1. Background
Title IV of the Clean Air Act Amendments of 1990 (CAAA) established
the Acid Rain Program to reduce acid rain in the United States. The
Acid Rain Program will achieve a 50 percent reduction in sulfur dioxide
(SO2) emissions from utility units. The SO2 reduction program
is a flexible market-based approach to environmental management. As
part of this approach, EPA allocates ``allowances'' to affected utility
units. Each allowance is a limited authorization to emit up to one ton
of SO2. At the end of each calendar year, each unit must hold
allowances in an amount equal to or greater than its SO2 emissions
for the year. Allowances may be bought, sold, or transferred between
utilities and other interested parties.
Section 410(h) of the Clean Air Act provides allowances for small
diesel refineries that produce diesel fuel that meets the requirements
of section 211(i) (that ``desulfurize'' diesel fuel) during the period
from October 1, 1993 through December 31, 1999. Section 410(h) limits
the annual allocations to small diesel refineries to 35,000, as
compared to the 8.95 million allowances for Phase II utilities. Also,
each eligible small diesel refinery is limited to 1500 allowances per
year. Small diesel refineries are not otherwise affected by the Acid
Rain Program and do not need the allowances to comply with any
provision of the Clean Air Act. Thus, the allowances serve as a
financial benefit to small diesel refineries desulfurizing diesel fuel.
2. Clarification of Eligibility
The preamble to both the proposed (56 FR 29940, July 7, 1992) and
final rules (57 FR 15645, March 23, 1993) concerning the allocation of
acid rain allowances to small refineries stated that only small diesel
refineries that desulfurized both on-road and off-road diesel fuels
would be eligible for allowances. However, the text of the rule allowed
all small refineries desulfurizing diesel fuel eligible to receive
allowances. 40 CFR 73.90.
The purpose of today's notice is to remedy any confusion caused by
the language in both preambles and to provide all eligible small
refiners with an opportunity to participate in the allowance program.
This notice clarifies that small refineries do not have to desulfurize
all diesel fuel to be eligible for allowances and supersedes the
preamble language.
Contrary to assertions EPA made in the preamble to the final rule,
nothing in section 410(h) clearly requires a small refiner to
desulfurize all of its on-road diesel fuel as well as all of its off-
road diesel fuel to obtain allowances. In particular, the declaration
in the preamble that the section 410(h)(6) certification provision is
``insistent'' on both on-road and off-road diesel fuel being
desulfurized ignores alternative interpretations of the certification
language that would simply read it to require that allowances could be
claimed only for the fuel that meets the section 211(i) standard.
Rather than reading the certification to impose a substantive
requirement not expressed elsewhere in section 410(h), the better
reading of the subsection as a whole is that allowances may be claimed
for all motor diesel fuel meeting section 211(i) that is produced at
the small refinery. This interpretation is consistent with the statute
and the text of the regulation and has been EPA policy in applying the
regulation to the requests for allowances for 1993 fuel
desulfurization.
EPA will consider a small diesel refinery eligible for allocation
of allowances based solely on the requirements in the definition of
``small diesel refinery'' at 40 CFR 72.2. A small diesel refinery does
not have to certify that it desulfurizes both on-road and off-road
diesel fuel.
3. Extension of 1994 and 1995 Filing Deadlines
EPA acknowledges that the preamble to the final rule, when compared
to the rule itself, created confusion as to the criteria for
eligibility. In implementing this program, EPA has followed the
statutory criteria, as implemented at 40 CFR 73.90 and 72.2.
After EPA provided notice of the allowances allocated to small
diesel refineries in 1994 (59 FR 34811, July 7, 1994), several small
refineries notified EPA that some refineries that had not desulfurized
100 percent of their diesel throughput were allocated allowances. The
commenting refineries argued that these refineries, based on the
criteria stated in the preamble to the rule, should not be eligible for
allowances. The small refineries that notified EPA sought to be deemed
eligible for allowances, in addition to the group listed in the Federal
Register notice.
In order to be fair to all small diesel refineries, EPA is
extending the April 1, 1994 deadline until May 15, 1995. Refineries
that did not apply for certification of eligibility or request
allowances for 1993 desulfurization because they thought they were not
eligible should apply for certification of eligibility and request
allocations no later than May 15, 1995. All refineries that wish to be
allocated allowances for 1994 desulfurization must request allocations
no later than May 15, 1995. For each year in the future, the date for
requests remains April 1.
Dated: March 15, 1995.
Mary D. Nichols,
Assistant Administrator for Air and Radiation.
[FR Doc. 95-6924 Filed 3-20-95; 8:45 am]
BILLING CODE 6560-50-P
