[Federal Register Volume 59, Number 144 (Thursday, July 28, 1994)]
[Unknown Section]
[Page ]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-18452]
[Federal Register: July 28, 1994]
_______________________________________________________________________
Part VII
Environmental Protection Agency
_______________________________________________________________________
40 CFR Parts 261 and 266
_______________________________________________________________________
Identification and Listing of Hazardous Waste; Final Rule
ENVIRONMENTAL PROTECTION AGENCY
40 CFR Parts 261 and 266
[EPA-530-Z-94-009; SWH-FRL-5022-4]
Identification and Listing of Hazardous Waste; Amendments to
Definition of Solid Waste
AGENCY: Environmental Protection Agency.
ACTION: Final rule.
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SUMMARY: The Environmental Protection Agency is today excluding from
the RCRA regulatory definition of solid waste certain in-process
recycled secondary materials utilized by the petroleum refining
industry. Specifically, today's rule states that oil recovered from
petroleum refinery wastewaters and from other sources, both on-site and
off-site, is excluded from the regulatory definition of solid waste if
it is subsequently inserted (along with normal process streams) into
the petroleum refining process prior to crude distillation or catalytic
cracking.
EFFECTIVE DATE: This final rule is effective on July 28, 1994.
ADDRESSES: The official record for this rulemaking is identified as
Docket Number F-94-SWF-FFFFF and is located in the EPA RCRA docket,
Room 2616, 401 M Street SW., Washington, DC 20460. The docket is open
from 9:00 to 4:00, Monday through Friday, except for Federal holidays.
The public must make an appointment to review docket materials by
calling (202) 260-9327. The public may copy a maximum of 100 pages from
any one regulatory docket at no cost. Additional copies cost $.15 per
page.
FOR FURTHER INFORMATION CONTACT: General questions about the regulatory
requirements under RCRA should be directed to the RCRA/Superfund
Hotline, Office of Solid Waste, U.S. Environmental Protection Agency,
401 M Street SW., Washington, DC 20460; Telephone: toll-free at (800)
424-9346, or locally at (703) 412-9810. For the hearing impaired, the
number is (800) 553-7672 (toll-free) or (703) 412-3323 (local). For
information on specific aspects of today's notice, contact Ross
Elliott, Office of Solid Waste (5304), U.S. Environmental Protection
Agency, 401 M Street SW., Washington, DC 20460, (202) 260-8551.
SUPPLEMENTARY INFORMATION:
Outline of Today's Rule
I. Authority
II. Background
A. Statutory Definition of Solid Waste
B. Prior Litigation
C. January 8, 1988 Proposal
D. Description of Petroleum Exploration, Development &
Production, and the Petroleum Refining Process
E. Petroleum Refining Wastewater Treatment
F. Recovered Oil and Recovered Oil Systems
G. Status of Wastewater Streams, Wastewater Treatment Units,
Recovered Oil, and Recovered Oil Systems Under Current RCRA Rules
III. Summary of Today's Final Rule
IV. Scope of Today's Final Rule
A. Limiting Scope to Recovered Oil from Petroleum Refining,
Exploration and Production
B. Rationale for Excluding Recovered Oil and Not Wastewater from
Being a Solid Waste
C. Rationale for Excluding Recovered Oil from Off-Site Sources
V. Rationale for Conditioning the Exclusion on Recovered Oil Not
Being Placed on the Land and Not Being Accumulated Speculatively
VI. Rationale for Not Excluding Recovered Oil that is Inserted into
the Petroleum Refining Process After Crude Distillation or Catalytic
Cracking (i.e., into Petroleum Coker)
VII. Rationale for Not Excluding Other Oil-Bearing Hazardous
Materials
VIII. Demonstration that Recovered Oil Meets Conditions of Exclusion
IX. Examples of How Today's Rule Operates
X. Relationship to Other Programs
A. Clean Air Act (Benzene NESHAP)
B. Clean Water Act
C. RCRA
1. RCRA Air Emission Standards
2. Used Oil
D. Enforcement; Effect of Today's Final Rule on RCRA 3007, 3013,
7002 and 7003 Authorities
XI. State Authority
A. Applicability of Rules in Authorized States
B. Effect on State Authorization
XII. Regulatory Requirements
A. Regulatory Impact Analysis Pursuant to Executive Order No.
12866
B. Regulatory Flexibility Act
C. Paperwork Reduction Act
I. Authority
These regulations are issued under the authority of Sections 2002
and 3001 et seq. of the Solid Waste Disposal Act, as amended by the
Resource Conservation and Recovery Act, as amended by the Hazardous and
Solid Waste Amendments of 1984, 42 U.S.C. 6912 and 6921 et seq.
II. Background
A. Statutory Definition of Solid Waste
The statutory definition of solid waste, RCRA Section 1004 (27), is
the starting point for determining RCRA Subtitle C jurisdiction. This
is because the term ``hazardous waste'' is a subset of ``solid waste.''
RCRA Sections 1004 (5) and 1004 (27). The statutory definition of solid
waste indicates that ``garbage, refuse, sludge * * * and other
discarded material'' are solid wastes. The critical issue is when
secondary materials (see definition at 50 FR at 616 n. 4, Jan. 4, 1985)
that are going to be recycled can be solid wastes. Today's rulemaking
addresses this question for certain operations commonly occurring in
the petroleum refining and related industries.
The reader should note that EPA is conducting an assessment of the
RCRA Definition of Solid Waste, as described in the EPA report, RCRA
Implementation Study Update.1 This ongoing effort may result in
proposed regulatory changes to the definition set forth in 40 CFR 261.2
and related requirements. Today's action, however, is fairly narrow,
applying to situations where certain oil-bearing secondary materials
are used or reused within the petroleum refining process. EPA will
continue its broad policy review of the Definition of Solid Waste, but
deemed unnecessary any delay in issuing today's rule.
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\1\RCRA Implementation Study Update: The Definition of Solid
Waste, U.S. EPA, July 1992, #EPA530-R-92-021.
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B. Prior Litigation
In its decision in American Mining Congress v. EPA, 824 F. 2d1177
(D.C. Cir. 1987) (AMC I), a divided panel of the District of Columbia
Circuit held that the Agency's rules defining the statutory term
``solid waste,'' RCRA Section 1004 (27), exceeded the Agency's
statutory authority to the extent that the rules asserted RCRA
authority over ``materials that are recycled and reused in an ongoing
manufacturing or industrial process.'' Id. at 1186 (emphasis original).
Because ``these materials have not yet become part of the waste
disposal problem'', id., they are not yet ``discarded'' within the
meaning of Section 1004 (27) and so cannot be considered to be ``solid
wastes.'' Subsequent judicial decisions confirm that the holding in AMC
I is limited to situations involving ``materials that are `destined for
immediate reuse in another phase of the industry's ongoing production
process' and that `have not yet become part of the waste disposal
problem.''' American Mining Congress v. EPA, 907 F. 2d 1179, 1186 (D.C.
Cir. 1990 (AMC II) (emphasis original); American Petroleum Inst. v.
EPA, 906 F. 2d 729, 740-41 (D.C. Cir. 1990) (API); Shell Oil v. EPA,
950 F. 2d 741, 755-56 (D.C. Cir. 1991); Chemical Waste Management v.
EPA, 976 F. 2d 2, 14 (D.C. Cir. 1992), cert. denied 113 S.Ct. 1961
(1993).
C. January 8, 1988 Proposal
On January 8, 1988, EPA proposed rules to implement the AMC I
opinion. Of particular significance to today's action, EPA proposed
certain amendments relating to the scope of the regulatory definition
of solid waste as applied to operations occurring within the petroleum
refining industry. In particular, the Agency proposed to exclude from
the regulatory definition of solid waste secondary materials associated
with ``on-going fuel production activities in the petroleum refining
industry. These activities involve situations where crude oil is
refined, and oil-bearing residues from that refining process are
returned for further refining as part of one continuous and on-going
process.'' 53 FR at 525 (Jan. 8, 1988). The Agency specifically
proposed to exclude oil-bearing residues from the refining process when
those residues are generated on-site and inserted into that on-site
petroleum refining process or coker, provided that these residues are
not managed in such a way as to be ``characterized by elements of
discard'' such as placement in a disposal unit like a surface
impoundment. Id. EPA is not taking any action today with respect to the
portions of the January 8, 1988 proposal dealing with non-petroleum
materials. These issues are being addressed by other on-going Agency
activities (see above, Section II.A.). The Agency is, as described
below, taking final action with respect to the petroleum materials.
D. Description of Petroleum Exploration, Development & Production, and
the Petroleum Refining Process
The presence of petroleum in geologic formations is confirmed by
the drilling of exploratory wells. Once located, the development of a
petroleum reservoir includes the drilling of additional wells to
extract the oil or gas, and well completion and stimulation techniques
designed to increase the recovery of oil or gas from that reservoir.
Petroleum production generally includes all the activities associated
with the recovery of petroleum from the geologic formation. These
production activities involve the operation and maintenance of the
producing well, and the handling and separation of the recovered crude
oil, natural gas, natural gas liquids, and water. The separation of
water/crude oil emulsions is performed in tanks by gravity settling, or
heat may be added to separate emulsions. Crude oil is then transported
via pipeline, vehicle or vessel to stock tanks and ultimately to the
refinery.
Petroleum refining involves several manufacturing operations and
processes, including crude desalting, atmospheric and vacuum
distillation, hydrotreating, catalytic cracking, thermal processing and
residual upgrading, light hydrocarbon processing, hydrocracking,
catalytic reforming, extraction, isomerization, lubricating oil
processing, sulfur removal and recovery, and product blending and
inventory. Products manufactured from petroleum refining include
hydrogen, fuel gas, sulfur, liquified petroleum gas, butane, aromatic
feedstocks, leaded and unleaded motor gasolines, jet fuel, kerosene,
diesel, heating oil, fuel oil, and asphalt. See generally, 55 FR at
46359 (Nov. 2, 1990); and EPA's Development Document for the effluent
guidelines for the petroleum refining industry.2
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\2\Section III of Development Document for Effluent Limitations
Guidelines, New Source Performance Standards and Pretreatment
Standards for the Petroleum Refining Point Source Category, U.S.
EPA, October 1982, National Technical Information Service #PB838-
172569.
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E. Petroleum Refining Wastewater Treatment
Petroleum refining operations generate large amounts of wastewater
that require treatment in order to reduce or remove wastewater
pollutants so as to produce effluent that meets discharge requirements
of the Clean Water Act. Principal sources of wastewater are refinery
process units (where wastewater comes in direct contact with oil), as
well as oily cooling waters from cooling towers and heat exchangers.
Storm water, which may be subject to minor oil contamination from leaks
or spills, is also a type of wastewater at a petroleum refinery.3
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\3\Id., and see Manual on Disposal of Refinery Wastes: Volume on
Liquid Wastes, American Petroleum Institute, 1969, pp. 3-4 to 3-5.
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Wastewater treatment systems at petroleum refineries generally
consist of: (1) a drainage and collection system to collect and carry
wastewaters to treatment units; (2) a primary treatment system to
separate oil/water/solids, and (3) a secondary treatment system,
normally involving biological treatment, to remove soluble
biodegradable wastewater pollutants. Some refineries have tertiary
treatment systems as well, consisting of water polishing steps before
discharge. Secondary and tertiary treatment is frequently conducted
using surface impoundments. Primary treatment, i.e. the initial
separation of water, oil, and solids, normally occurs in tanks.
F. Recovered Oil and Recovered Oil Systems
Today's rule deals primarily with the status under RCRA Subtitle C
of recovered oil which is returned to the petroleum refining process.
``Recovered oil'' is a generic term that applies to secondary materials
consisting primarily of oil such as oil separator skimmings from plant
wastewaters, slop oil and emulsions, oil skimmed from ballast water
tanks, and oil from refinery process units (e.g., off-specification
process streams). As explained in detail below, today's rule excludes
from the definition of solid waste recovered oil from petroleum
exploration and production, petroleum refining, and transportation
incident to either of these activities, when the recovered oil is
reinserted into a petroleum refining process. The exclusion does not
apply to recovered oil generated from petroleum operations downstream
of refining such as marketing or retail sales--because this oil is
already excluded for the most part, as discussed below --, or from non-
petroleum industry operations.
This rule also does not exclude hazardous sludges (such as wastes
K048, K051, or F037) or other similar wastes from regulation.
Distinguishing between these wastes and recovered oil is sometimes
difficult. Factors EPA will consider in making this distinction include
water content, solids content, and potentially, metals content. See
generally 50 FR at 49170 n. 16 (Nov. 29, 1985). EPA repeats, however,
that the salient characteristic of recovered oil is the obvious one:
that it consist primarily of oil.
Used oil also is not a type of recovered oil, and hence remains
subject to the applicable regulations for used oil. See generally 59 FR
10550 (March 4, 1994). The only exception is when de minimis quantities
of used oil are incidentally captured by refinery wastewater treatment
systems. This could occur, for example, when small leaks, spills, or
drippings of used oil from machinery, pumps, or other refinery
equipment during normal operations are lost to the wastewater treatment
system. In these instances, the used oil present in de minimis
quantities in wastewater is not subject to the used oil standards. See
generally 57 FR at 41566 (Sept. 10, 1992).
The objective of a recovered oil system is to gather and recycle
oil generated throughout the refinery, or (to a lesser extent)
generated from off-site sources.4 Recovered oil operations almost
always occur in tanks, usually a series of tanks that successively
purify the oil to the point where it is sufficiently clean and
dewatered to be inserted into the petroleum refining process. 53 FR at
525. Some oil is collected directly from process units and sent by
means of pipes or vacuum trucks to the refinery's dedicated oil tanks.
Occasionally this recovered oil is of sufficient purity that it can be
inserted directly into the refining process with little or no treatment
in the recovered oil system.
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\4\See RCRA Docket No. F-87-SWRP-FFFFF, submission by the
American Petroleum Institute on ``Recovered Refinery Oil System'',
April 16, 1993.
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Recovered oil from plant wastewater operations is most often a
water-in-oil emulsion, which is sent first to tanks where gravity
separates much of it into oil, emulsion, and water layers. The
intermediate layer of emulsions then may be sent to other tanks where
it will undergo further emulsion-breaking treatment (e.g., mechanical
centrifuging, heating, or chemical additives). At the end of each
stage, the separated water is returned to the refinery oil/water
separators, while the oil is either further treated or, if sufficiently
dewatered, is returned to one or more refinery process units. These may
include crude oil distillation or catalytic cracking units.5
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\5\Id.
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G. Status of Wastewater Streams, Wastewater Treatment Units, Recovered
Oil, and Recovered Oil Systems Under Current RCRA Rules
Under present RCRA regulations, petroleum refinery wastewaters
upstream of a wastewater discharge that is subject to regulation under
Sections 307(b) or 402 of the Clean Water Act, are solid wastes. See 40
CFR 261.4(a)(1) and (2). Such petroleum refinery wastewaters are
hazardous if they exhibit a characteristic of hazardous waste, or are
listed hazardous wastes (although there are presently no specific
hazardous waste listings for petroleum refining industry wastewaters).
Petroleum refining wastewater storage and treatment operations generate
a number of listed hazardous wastes. In particular, sludges from
primary treatment operations are listed under the generic F037 and F038
listings. Sludges from Dissolved Air Flotation (DAF) wastewater
treatment units and API separators (particular types of primary
wastewater treatment devices) are listed as wastes K048 and K051,
respectively. Slop oil systems generate listed wastes as well: slop oil
emulsion solids are listed as K049. Also, EPA is studying additional
petroleum refining wastes as part of a listing determination required
by RCRA 3001 (e)(2).
In addition, petroleum refineries typically generate large volumes
of wastes that exhibit hazardous waste characteristics. Individual
wastewater streams upstream of wastewater treatment may exhibit the
Toxicity Characteristic, particularly for chromium, lead and benzene
(see 40 CFR 261.24), or the characteristics of corrosivity or
ignitability (40 CFR 261.21 and 261.22, respectively). These
wastewaters may also contain other hazardous constituents that are not
part of the Toxicity Characteristic. See Tables in Section V,
Development Document for Effluent Limitations Guidelines, New Source
Performance Standards and Pretreatment Standards for the Petroleum
Refining Point Source Category. Sludges generated from secondary or
tertiary wastewater treatment also may exhibit one or more hazardous
waste characteristics.
Tanks storing listed wastes which engage in primary wastewater
treatment operations are presently exempt from federal Subtitle C
regulation because they are wastewater treatment units (i.e. tanks). 40
CFR 264.1 (g)(6) and 265.1 (c)(10). Hazardous wastes removed from those
units are subject to regulation upon exiting the tanks. However,
recovered oil is exempt from Subtitle C regulation, as is any fuel
produced from such oil, under the current exemptions at Sec. 261.6
(a)(3)(iv)-(vii). The units engaged in recovered oil operations would
also be exempt under current regulations, to the extent that these
units are managing materials exempt under Sec. 261.6 (a)(3)(iv)-(vi).
III. Summary of Today's Final Rule
EPA is finalizing a revised version of the January 8, 1988 proposal
in today's notice. The final rule states in essence that recovered oil
from petroleum refinery operations, petroleum exploration and
production, and transportation incident thereto, is excluded from the
regulatory definition of solid waste if it is subsequently inserted
into the petroleum refining process prior to crude distillation or
catalytic cracking. The recovered oil thus need not be generated at the
site of the refining process--a potentially significant expansion of
the proposal. This exclusion applies, however, only if the oil is not
managed in land disposal units or accumulated speculatively before it
is inserted.
EPA expects that most of the recovered oil affected by this rule
will be generated from wastewater treatment operations. As explained
below, EPA is narrowing the proposal (which would have excluded
petroleum refining wastewaters containing oil that eventually gets
recycled) by finding that refinery operations upstream of recovered oil
systems involve wastewater treatment, not an on-going refining process.
Thus, petroleum refinery wastewaters undergoing treatment should not be
excluded from the definition of solid waste. In addition, even if these
wastewater treatment operations are characterized as also involving
recycling, the operations involve discarded residuals that can be part
of the waste disposal problem, and hence the wastewater treatment
operations need not be characterized as part of an ``ongoing production
process'' for purposes of excluding materials from the definition of
solid waste. Once oil is recovered, however, the Agency believes it
reasonable to exclude it from the definition of solid waste if the oil
is to be reused in the refining process (even though the oil may still
require a significant amount of further processing before it can
actually be so reused). This is because the recovered oil and its
management within refining operations can be viewed as part of the
petroleum refining process and not part of the waste disposal problem.
EPA is also slightly amending the regulatory exemption for
petroleum coke produced using oil-bearing refinery hazardous waste (see
Sec. 261.6 (a)(3)(vii), redesignated (a)(3)(vi) in today's rule). The
Agency is slightly broadening the current exemption so that it also
applies to coke produced by a single petroleum refining entity, but the
coker is located at a different facility from where the hazardous
wastes are generated.
As a matter of drafting, the principal change brought about by
today's rule takes the form of an exclusion from the regulatory
definition of solid waste. Specifically, paragraph (12) is being added
to the list of exclusions in Sec. 261.4 (a). In addition, EPA is
removing the regulatory exemption in Sec. 261.6(a)(3)(v) which is
superseded by today's exclusion, and redesignating the remaining
exemptions in Sec. 261.6(a)(3) (vi) and (vii) as Sec. 261.6(a)(3) (v)
and (vi), respectively, in order to maintain consecutive numbering. EPA
is also revising two other regulatory exemptions in Sec. 261.6(a)(3).
Finally, EPA is making conforming changes to Secs. 261.3(c)(2)(ii)(B)
and 266.100(b)(3), both as a result of today's rulemaking, and to
reflect conforming changes that EPA inadvertently omitted during
promulgation of the used oil final rule (57 FR 41566 (September 10,
1992)).
IV. Scope of Today's Final Rule
A. Limiting Scope to Recovered Oil From Petroleum Refining, Exploration
and Production
As noted above, today's rule excludes recovered oil generated from
petroleum exploration, production and refining activities, and from the
transportation incident thereto, from being a solid waste when the
recovered oil is inserted into a designated point in a petroleum
refining process. This section of the preamble discusses why EPA is
crafting the exclusion in this manner. More specifically, we discuss
why the exclusion does not cover oil recovered in operations downstream
from petroleum refining, and why the exclusion does not apply to
recovered oil from industries other than petroleum refining,
exploration, or production.
EPA is not excluding recovered oil from operations downstream of
refining, such as marketing or retail sales, because such oil is
already excluded from regulation (so long as it is not disposed of).
Under existing section 261.33, unused commercial chemical products that
are recycled in most manners are not solid wastes when they are
recycled. This principle applies to unused fuels that are recycled by
being returned to fuel-production processes. (See also RCRA section
3004 (q)(l), establishing a similar principle.) Thus, for example, if a
bulk oil storage terminal has a spill of product and is able to capture
the spill and return it to a refinery or other legitimate fuel
production operation, the spilled product is not a solid waste. (As
noted at 55 FR 22671 (June 1, 1990) however, mere assertion of an
intent to recycle a commercial product spill does not convert the spill
into a non-waste. There must be objective indicia that recycling is
reasonable, and that it will occur in a timely manner.)
For different reasons, EPA is not extending the exclusion to
recovered oil from non-petroleum industries. First, such an exclusion
is beyond the scope of the proposed rule. It is also beyond the scope
of the judicial decisions construing the definition of solid waste.
These decisions indicate that when one industry sends its residual
materials to another industry for recycling, the initial industry can
be considered to have discarded them. API v. EPA, 906 F. 2d at 741-42;
Ilco v. EPA, 996 F. 2d 1126 (11th Cir. 1993). EPA is also concerned
that when recovered oil originates with non-petroleum industries, the
likelihood increases that the oil can be contaminated with toxic
constituents that would not normally be found in petroleum industry
recovered oil. See generally, 56 FR at 48009 (Sept. 23, 1991); and see,
e.g., EPA's Development Document for effluent guidelines for the iron
and steel industry (skimmed oil from iron and steel industry contains
contaminants not found in petroleum recovered oil).6 Such oily
material consequently is more likely to differ from the feedstocks
customarily processed by refineries and thus need not be viewed as part
of that process, and may also pose risks that can be viewed as part of
the waste disposal problem. Finally, the Agency is studying this issue
under the aegis of the Solid Waste Definition Task Force and is not at
a point where it is in a position to make a final determination.7
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\6\Volumes I-V of Development Document for Effluent Limitations
Guidelines and Standards for the Iron and Steel Manufacturing Point
Source Category, U.S. EPA, May 1982, National Technical Information
Service #PB82-240-425, -433, -458, -466, and -474. See specifically
Volume III, pp. 395-398; Volume IV, pp. 107-129; Volume V, p. 227.
\7\EPA also notes that when Congress created certain exemptions
(not exclusions) from hazardous waste fuel labelling requirements to
accommodate certain petroleum industry practices involving recovered
oil, it limited the scope of those exemptions to fuels produced from
oily materials ``resulting from normal petroleum refining,
production and transportation practices'', RCRA section 3004 (r)(3).
This is similar to the scope of today's rule.
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B. Rationale for Excluding Recovered Oil and Not Wastewater from Being
a Solid Waste
EPA is also determining today that the oil that is skimmed from
plant wastewaters during wastewater treatment (normally during the
initial oil/water/solids separation step occurring during primary
wastewater treatment), as well as oil recovered from other sources, is
not a solid waste if it is going to be inserted into the refining
process prior to the point in the process where crude distillation or
catalytic cracking occurs. Thus, the recovered oil systems themselves
would not be waste management units. (These units may, however, contain
hazardous wastes, such as K049, which become subject to regulation when
removed from such units. See 40 CFR 261.4 (c), which says that
hazardous waste regulation does not begin for (among other things)
hazardous waste which is generated in an associated non-waste-
treatment-manufacturing unit until the waste is removed from the unit.)
The petroleum industry argued in its public comments to the January
8, 1988 proposal that plant wastewaters containing oil are not solid
wastes either. Rather, they characterize the primary wastewater
treatment operations in which oil is skimmed from plant waters as still
being part of the refining process. Thus, the argument goes, any step
at a refinery that involves some recovery of oil for further use is
still part of the ongoing refining process and cannot involve solid
waste under the holding of AMC I.
EPA disagrees with respect to primary wastewater treatment
operations. These operations do not involve secondary materials that
are ``recycled and reused in an ongoing manufacturing or industrial
process'', AMC I, 824 F. 2d at 1186 (emphasis original); see also AMC
II, 907 F. 2d at 1186 (AMC I concerns only ``materials that are
`destined for immediate reuse in another phase of the industry's
ongoing production process''') (emphasis original). Primary wastewater
treatment operations exist to treat plant wastewater. The percentage of
oil in plant wastewaters that form the influent to primary wastewater
treatment is minuscule, on the order of .0001 % to .000001 % (i.e. from
1 to 100 parts per million oil). See Tables in Section V, Development
Document for Effluent Limitations Guidelines, New Source Performance
Standards and Pretreatment Standards for the Petroleum Refining Point
Source Category. While some oil may be recovered from this wastewater
(an activity the Agency certainly encourages, and indeed requires to
prevent the oil's discharge to surface waters and POTWs), the amounts
are not significant in the context of a refinery's overall production
activities. Clearly, wastewater treatment is the main purpose of the
systems in question, and any oil recovery is of secondary import.
Refinery wastewater is not a ``secondary material immediately
reused within an industrial process''. Chemical Waste Management v.
EPA, 976 F. 2d at 14. Primary wastewater treatment is the first step in
the wastewater treatment process that purifies the discarded
wastewaters from the refining process so that those discarded waters
can ultimately be discharged to navigable waters pursuant to Clean
Water Act requirements. That a small amount of oil is removed from
these wastewaters in the course of treatment does not make wastewater
treatment a petroleum refining operation. Put another way, the fact
that a small amount of oil may be recovered from large volumes of the
discarded plant wastewaters does not require EPA to consider those
operations to involve non-discarded materials, and hence to exclude all
of the materials going to primary wastewater treatment operations from
the definition of solid waste. AMC II, 907 F.2d at 1186-7
(``discarded'' is an ambiguous term that EPA may interpret in a
reasonable manner, and EPA's interpretation that recoverable materials
managed in wastewater treatment operations containing surface
impoundments were discarded solid wastes was reasonable).
On the other hand, recovered oil systems can be legitimately viewed
as part of the petroleum refining process. The input to the recovered
oil systems is primarily oil skimmed from wastewater treatment
operations as well as oil recovered from other sources, not discarded
refining process wastewaters. Recovered oil systems do not exist to
remove contaminants from wastewater. Rather, their purpose is to
restore recovered oil to sufficient purity so that it can be reused as
a feedstock material in the refining process. This is a natural point
to characterize activities as being part of the refining process.
It is thus EPA's view that until oil is recovered from refinery
process wastewaters, the wastewaters are discarded materials and hence
solid wastes potentially subject to regulation under RCRA.8
(Wastewaters remaining after oil has been recovered are still solid
wastes, and are typically returned to an upstream point in the
refinery's wastewater treatment system.) The oil recovered from such
wastewaters is not a solid waste, however (assuming it is reinserted
into the refining process). This reading is not only in accord with
common sense, as explained above, but also is in accord with RCRA's
goals and purposes. AMC II, 907 F. 2d at 1186-87; API, 906 F. 2d at
740-41. As these cases make clear, EPA may ordinarily consider
secondary materials that have ``become part of the waste disposal
problem'' to be discarded. API, 906 F. 2d at 741; AMC II, 907 F. 2d at
1186. That is the case here. Discarded plant wastewaters up to and
including the primary wastewater treatment step, can contain high
loadings of hazardous constituents that may pose environmental harm if
released. It is estimated that an average of 34% of the benzene (a
human carcinogen) entering a petroleum refinery's wastewater treatment
system is emitted to air from the wastewater collection portion of the
system; when primary wastewater treatment (i.e., a non-enclosed oil-
water separator) is included in this calculation, the amount of benzene
emitted relative to the influent concentration rises to 47%.9
Primary wastewater treatment also is sometimes conducted in land-based
or in-ground units, which can (and have) resulted in environmental
contamination.10 This further indicates that these operations can
be part of the waste management problem.
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\8\On a similar note, the Agency is aware of activities at
petroleum management facilities where free-phase hydrocarbon (from
spills, etc.) is removed from the water table as part of groundwater
remediation (see 56 FR at 13406 (Apr. 2, 1991)). These hydrocarbon
recovery operations can recover materials ranging from mostly water
to mostly oil; only recovered materials that are primarily oil, and
that can be inserted into a refinery's recovered oil system without
pretreatment (or can be inserted directly into the refining process
itself), would be considered ``recovered oil'' eligible for today's
exclusion. The management of petroleum-contaminated groundwater in
separation and treatment units is clearly solid waste (and
potentially hazardous waste) management, essentially wastewater
treatment.
\9\The Agency addressed benzene emissions from waste operations
in a final rule published January 7, 1993 (58 FR 3072) using risk-
based standards for benzene. See also EPA, Final NESHAP Standards
for Waste Operations: Basis for Impact Calculations, February 16,
1990. This document is available in the Benzene Waste Operations
NESHAP docket.
\1\0``Background Document to Support Listing of Primary Oil/
Water Separation Sludges from the Petroleum Refining Industry,''
U.S. EPA, December 22, 1989, pp. 6, 10-12.
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In addition, petroleum refineries frequently generate individual
wastewater streams that exhibit characteristics of hazardous waste,
which streams are mixed together so that the characteristic is removed.
(The characteristic can be removed either before or during primary
treatment.) These aggregated wastewater streams may still contain high
volumes of hazardous constituents, however, because aggregation (i.e.
dilution) and primary treatment do not significantly remove or destroy
all hazardous constituents. See Tables in Section V, Development
Document for Effluent Limitations Guidelines, New Source Performance
Standards and Pretreatment Standards for the Petroleum Refining Point
Source Category. The aggregated wastewaters are then managed in surface
impoundments, where biological treatment occurs. The D.C. Circuit has
made clear, in Chemical Waste Management v. EPA, that in such
circumstances the decharacterized wastewaters cannot be managed in
surface impoundments unless they have first been treated to meet the
treatment requirements of RCRA Section 3004(m) (requiring treatment
that substantially removes or destroys hazardous constituents so that
threats to human health and the environment are minimized), or unless
treatment equivalent to Section 3004(m) treatment occurs before the
wastewaters are discharged. Id. at 7, 20-24.\11\ The court indeed
repeatedly referred to these treatment standards as the core of RCRA's
hazardous waste management scheme. Id. at 23, 24.
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\1\1EPA is still working to interpret the scope of the
``equivalence'' requirement in the Chemical Waste Management
opinion, and the language in the text should not be taken as
representing the Agency's resolution of the issue. It is clear,
however, that the opinion imposes obligations on facilities that use
impoundments to manage wastewaters that are decharacterized by means
other than full-scale section 3004 (m) treatment.
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EPA's interpretation that the influent into primary wastewater
treatment consists of discarded wastes, not in-process petroleum, is
fully in accord with these core principles of RCRA. Decharacterized
wastewaters that are going to be managed in surface impoundments would
nevertheless receive Section 3004 (m) treatment before their ultimate
discharge, as required by the Chemical Waste Management opinion. Under
industry's preferred reading, however, the decharacterized wastewaters
would not be solid wastes at all until all oil recovery has been
completed, even if held in impoundments. At that point, the wastewaters
would no longer exhibit a characteristic (because they have been
diluted through aggregation), and thus would not be prohibited wastes
subject to Section 3004 (m) treatment. The ``core principles of RCRA''
would thus be avoided. EPA considers its interpretation of
``discarded,'' that assures proper treatment of characteristically
hazardous petroleum refinery wastewaters that are going to be managed
in surface impoundments, to be more reasonable.12
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\1\2EPA views the facts here as similar to those in the AMC II
case. In particular, both situations involve wastewater treatment
operations, where plant wastewaters could ultimately be managed in
surface impoundments.
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EPA acknowledges that it initially proposed to exclude all such
wastewaters from the definition of solid waste. 53 FR 525-526. However,
the Agency's reasoning was based in part on the same mistaken view of
the scope of AMC I that was later rejected by the API court. 906 F. 2d
at 740-41. (EPA even relied in part on the overbroad ``indigenous''
concept, 53 FR 525, 526, that was remanded in API. 906 F. 2d at 739,
742.) The Agency is obviously not bound by its proposal, and subsequent
case law makes clear that the Agency has more interpretive discretion
than it imagined in 1988. The interpretation adopted in today's rule is
reasonable and in accord with statutory goals and purposes.
Nor is today's action inconsistent with AMC I's statements
regarding the scope of petroleum refining activities that are outside
the scope of Subtitle C. That opinion indicated that in petroleum
refining operations ``(a)ny hydrocarbons that are not usable in a
particular form or state are returned to an appropriate stage in the
refining process so they can eventually be used. Likewise, the
hydrocarbons and materials which escape from a refinery's production
vessels are gathered and, by a complex retrieval system, returned to
appropriate parts of the refining process.'' 824 F. 2d at 1181. Today's
rule does not assert RCRA jurisdiction over any refining operations
that process hydrocarbons into products, nor over hydrocarbons that are
lost from process vessels and are gathered for return to refining.
Rather, the Agency is stating that up to and including primary
wastewater treatment, plant wastewaters are just that, and their
management is potentially subject to Subtitle C controls. Oil that is
recovered from wastewater, however, is no longer a solid waste, and
recovered oil systems that do engage in retrieval of hydrocarbons for
eventual refining are not subject to RCRA controls.13
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\1\3The Agency also views its action as consistent with its
rulemaking involving residues from coke by-product operations that
are returned to the coking process, or related processes. 57 FR
27880 (June 22, 1992). The Agency stated that such materials were
not solid wastes provided they were not land disposed before
reinsertion. See 40 CFR 261.4(a)(10). However, unlike the petroleum
wastewaters containing small amounts of oil at issue here, the coke
byproduct residues were found to be very similar to the raw material
being replaced, and required no further purification to be usable.
They could be inserted more or less directly into the coking or
related tar-refining processes. Such residues are conceptually
analogous to the purified oil coming from a petroleum slop oil
facility.
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C. Rationale for Excluding Recovered Oil From Off-Site Sources
Today's final rule, in defining the scope of recovered oil subject
to the exclusion, excludes recovered oil from both off-site and on-site
sources. EPA believes that recovered oil from petroleum refining,
exploration and production, and transportation incident thereto,
whether generated from these off-site or on-site sources, is
essentially the same raw material (i.e., ``oil'') as that which is
normally and routinely transported to, and inserted into, petroleum
refining processes. Therefore, recovered oil from off-site sources
should also be excluded when it is going to be recycled in this
manner.14 Examples of off-site sources of recovered oil include
oil recovered from other petroleum refineries, and from oil and gas
drilling operations.15
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\1\4Certain wastes from petroleum exploration, development and
production are currently exempt from Subtitle C regulation under
Sec. 261.4(b)(5). There may be a degree of overlap between the
materials excluded by today's action, and materials currently exempt
under Sec. 261.4(b)(5). See 53 FR at 25446 (July 6, 1988), 58 FR
15284 (Mar. 22, 1993), and Report to Congress, Management of Wastes
from the Exploration, Development, and Production of Crude Oil,
Natural Gas, and Geothermal Energy, Volumes 1-3 and Executive
Summaries, December 1987, EPA/530-SW-88-003, for descriptions and
clarifications of exempt and non-exempt wastes from oil and gas
exploration, development, and production.
\1\5As noted above, recovered oil does not include ``used oil''
(as defined in 40 CFR 279.1) brought to a refinery from off-site
sources. (De minimis quantities of used oil that are incidentally
captured by refinery wastewater treatment systems and subsequently
recovered with other oil are not considered used oil.) See 57 FR
41566 (September 10, 1992) and 59 FR 1994 (March 4, 1994) for
discussion on the scope of the definition of used oil. See also
Section X.C.2 ``Used Oil'' later in this preamble.
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This exclusion is somewhat broader than that proposed in the
January 8, 1988 notice, which would have limited the exclusion to
materials generated on-site. 53 FR 525. However, the 1988 proposal
would not have been limited to recovered oil, but rather would have
included all oil-bearing secondary materials, so that the Agency was
particularly concerned with limiting the exclusion's scope because such
materials as listed sludges, tank bottoms and contaminated media could
be excluded. Id. In addition, if the exclusion was to cover oil-bearing
hazardous secondary materials, EPA was concerned that RCRA Section
3004(r)(2) would be rendered meaningless. Id. These concerns are no
longer present when the exclusion is limited to recovered oil.
The main reason for extending the exclusion to recovered oil
generated at locations other than a refinery (when such oil is
ultimately returned to a refinery) is that the oil is essentially the
same (in terms of physical composition and potential risk) as recovered
oil generated on-site. (The only significant difference is that
recovered oil generated off-site is transported--in the same manner as
crude oil. EPA does not regard this distinction as significant enough
to warrant different regulatory status for off-site recovered oil.) The
Agency thus is responding to comments received from industry, urging
the Agency to extend the scope of the exclusion to certain off-site
activities. However, these commenters argued further that refineries
comprise but one segment of a large, integrated industry, extending
from the production field, through the pipeline, to the refinery, to
the marketing terminal, to tank trucks, and, ultimately, to the
customer. EPA does not necessarily accept this argument, which is
unnecessary to justify today's rule. Again, EPA will continue its
broader policy review of the Definition of Solid Waste. EPA notes as
well that the action in today's rule is not precedential for other
industries. Determining what activities are a part of on-going
production activities and not part of the waste disposal problem
necessarily entails fact-specific evaluation. The Agency's conclusions
regarding secondary materials generated by particular industries thus
need not be germane to the regulatory status of secondary materials
generated by other industries.
V. Rationale for Conditioning the Exclusion on Recovered Oil Not Being
Placed on the Land and Not Being Accumulated Speculatively
This rule does not exclude land-based hazardous waste management
units from which oil may be recovered. Thus, if recovered oil, or
material containing oil, is placed in land-based units such as surface
impoundments or land treatment units, those units remain subject to
Subtitle C requirements (provided the material being placed is
hazardous under RCRA). The Agency considers material placed in such
units to be discarded, and hence solid wastes. See also AMC I, 824 F.
2d at n.20. These are classic disposal practices (see RCRA Section
1002(b)(7)), and placement of oily materials in such units (whether for
storage, treatment, or disposal) is inconsistent with the use of the
material as a valued product. In addition, the D.C. Circuit held in AMC
II that materials destined for recycling were still solid wastes if
held in surface impoundments before being recycled (907 F. 2d at 1186).
The final condition for the exclusion to apply is that recovered
oil not be accumulated speculatively (as defined in Sec. 261.1(c)(8))
before it is recycled back into a petroleum refining process. This is a
standard condition that the Agency applies to otherwise excluded
secondary materials (see, e.g., Sec. 261.2(e)(2)(iii)) to prevent the
materials being held for prolonged periods without being recycled, with
attendant increased environmental risk. See 50 FR at 634-635, 658-661
(Jan. 4, 1985). No commenter seriously questioned applying this
condition. Thus, recovered oil that would otherwise be excluded that is
accumulated speculatively is considered to be discarded and hence a
solid waste.
VI. Rationale for Not Excluding Recovered Oil That Is Inserted Into the
Petroleum Refining Process After Crude Distillation or Catalytic
Cracking (i.e., Into a Petroleum Coker)
Today's final rule is narrower in scope than the January 8, 1988
notice in that the Agency is not finalizing the proposed exclusion of
recovered oil that is converted to petroleum coke. EPA is deferring the
exclusion at this time because EPA lacks data assuring that hazardous
constituents from petroleum refining do not end up in the product in
quantities that, when such product is utilized as a fuel, could be
harmful to human health and the environment. EPA is also concerned that
toxic constituents, such as heavy metals, can be discarded by simple
incorporation into the coke product. In effect, the product would be
used as a disposal medium for toxic constituents, and so could be part
of the ``waste disposal problem.'' The Agency also lacks sufficient
data to show whether oil recovered from refinery wastewater treatment
systems contains toxic metals that are not present in the normal feed
to a petroleum coker. Such metals could end up in the coke product.
In contrast, the Agency is excluding recovered oil inserted at or
before a point in the refining process designed to remove toxic metal
and organic contaminants, i.e., prior to crude distillation or
catalytic cracking. See 50 FR 28725 (July 15, 1985) and 50 FR 49169
(November 29, 1985). As explained there, the distillation process
splits the feedstock into fractions based on the differing boiling
points of feedstock components. Data submitted by API at that time
indicated that most metals concentrate in the heavier petroleum
fractions, thereby increasing the probability of contaminant removal
from many fuel fractions produced using distillation (and other
contaminant-removing processes). See 50 FR 49170.
Although the proposed exclusion of recovered oil that is converted
to petroleum coke is not being finalized in today's rule, for different
reasons EPA is slightly amending the regulatory exemption at
Sec. 261.6(a)(3)(vii) (redesignated Sec. 261.6(a)(3)(vi) in today's
rule) for petroleum coke produced using oil-bearing refinery hazardous
waste. The exemption states that such coke is subject to regulation
only if it exhibits a characteristic of hazardous waste. (The exemption
recites the provisions of RCRA section 3004(q)(2)(A).) The purpose of
the statute, and the exemption, is to allow petroleum companies to
recycle their oily refinery waste to their petroleum coker, without
automatically subjecting the coke output to the rules applicable to
hazardous waste fuels. (Such automatic effect could occur without the
exemption, if listed wastes are being reinserted into the coker,
because of the derived-from rule.) S. Rept. No. 298, 98th Cong. 1st
Sess. 39 (1983).
Both the statutory and current regulatory exemption, however, are
worded so as to apply only to situations where petroleum coke is
produced from hazardous wastes ``at the same facility at which such
wastes were generated * * *''. EPA believes that this limitation is
unnecessarily narrow, and does not foreclose a regulatory expansion. In
particular, so long as a petroleum refinery is coking its own wastes,
it should not matter whether the coker is located at the site where
wastes are generated or at a different facility. Since the generator
and coker operator remain the same entity (or ``person'', as defined in
Sec. 260.10) there is sufficient guarantee that hazardous wastes of
unknown or uncertain composition will not be used in the coking
process, which is the evident concern behind the limitation in the
statute. Cf. 50 FR at 28725 (July 15, 1985); 50 FR 49170 (Nov. 29,
1985). Since the hazardous wastes would remain regulated under RCRA
when they are generated, transported, and stored prior to recycling,
id., potential concerns regarding tracking are also addressed. EPA also
sees no difference in the composition of coke produced partially from
on-site and off-site hazardous wastes when the coke is produced by the
same entity. Consequently, the Agency is slightly broadening the
current regulatory exemption so that it applies to coke produced by a
single petroleum refining entity, even if the coker is located at a
different facility from where the hazardous wastes are generated.
Finally, the coking process itself continues to be exempt from RCRA
regulation as a recycling unit, provided this recycling is legitimate.
Section 261.6(c)(1) (``The recycling process itself is exempt from
regulation except as provided in Sec. 261.6(d).''). Today's rule does
not affect this provision.
VII. Rationale for Not Excluding Other Oil-Bearing Hazardous Materials
Just as EPA is not excluding oil-bearing wastewaters from the
definition of solid waste, it is not excluding other similar types of
oil-bearing materials, such as hazardous wastewater treatment sludges.
These materials are not composed primarily of oil; they are unlike raw
materials normally used in the petroleum refining process; and the
units in which they are managed--API separators, DAF units, land
treatment units and surface impoundments--are not parts of the refining
process, but rather function as waste holding and treatment units. In
addition, there have been many damage incidents associated with
management of such materials as toxic sludges from wastewater
treatment, confirming that these materials are part of the waste
disposal problem, rather than part of an on-going manufacturing
operation. (See, for example, the Listing Background Documents for
Hazardous Wastes K048-052 and F037-038.) For these reasons, the Agency
continues to classify these materials as discarded, within the meaning
of RCRA Section 1004 (27). Recovered oil that is obtained from such
wastes, however, is excluded from the definition of solid waste under
today's final rule (assuming the rule's conditions are satisfied).
The Agency is also aware of various types of units designed to
treat wastes K048-K052 and F037-F038, in order to reduce the volume and
toxicity of these wastes, as well as to recover oil. See, e.g., 57 FR
37198 (August 18, 1992). EPA does not view these units as part of the
manufacturing (i.e., refining) process, because such units are not part
of a continuing series of unit operations that crack/distill/
fractionate crude oil. The input to these units are materials such as
wastewater treatment sludges, that contain relatively small amounts of
oil. A different determination frustrates the Congressional objective
that hazardous waste be treated properly. These types of units are the
basis for treatment standards under the land disposal restrictions for
K048-K052 and F037-F038. If the sludges treated in these units are no
longer hazardous waste, they would not need to be treated by
application of BDAT so as to minimize the threats they pose. Cf. API,
906 F. 2d at 741-742. Thus, excluding such sludges from jurisdiction
until properly treated could contribute to the waste disposal problem
that Congress sought to remedy. Finally, although EPA is not excluding
these types of oil-bearing materials (such as hazardous wastewater
treatment sludges), the units in which the recovery of oil is occurring
may still be a type of recycling unit, and therefore may be exempt from
RCRA permitting requirements under 40 CFR 261.6(c)(1).
VIII. Demonstration That Recovered Oil Meets Conditions of Exclusion
Under Sec. 261.2(f), persons claiming that recovered oil is
excluded from the definition of solid waste bear the burden of proof in
enforcement actions to demonstrate that they qualify for the exclusion.
This would normally require some type of demonstration that the
recovered oil is going to be and actually is used in a petroleum
refining operation prior to crude distillation or catalytic cracking.
For on-site sources, this documentation could be entries in the
operating records of the facility showing where the oil is recovered
and where it re-enters the refining process. For off-site sources, this
demonstration is especially important. Adequate documentation could
entail bona fide contractual agreements with other facilities to take
the recovered oil, shipping or delivery records to the receiving
facility, or other similar records. These records are important to show
enforcement personnel that the conditions of the exclusion have been
met. Without this documentation, the burden of proof will ordinarily
not be satisfied because enforcement personnel will have no way of
verifying that the recovered oil actually was used in the refining
process and the assumption can be made that the oil was not reused, and
was instead sent off-site or managed on-site as a hazardous waste.
IX. Examples of How Today's Rule Operates
Example 1
Petroleum refinery A generates wastewater. As part of primary
wastewater treatment, it skims oil from the wastewater. This
operation occurs in wastewater treatment tanks. The skimmed oil is
then gathered and inserted directly into crude oil storage units for
insertion into the refining process.
The refinery process wastewater is still considered to be a
solid waste, notwithstanding that some oil is skimmed from it. The
wastewater treatment tanks used for treating the wastewater are
exempt from subtitle C regulation. Section 264.1(g)(6),
265.1(c)(10). The skimmed oil is recovered oil that is excluded from
being a solid waste under today's regulation because it originates
from petroleum refining, it is not land disposed before being
recycled, and it is returned to the designated part of the petroleum
refining process. (This answer assumes that the recovered oil is not
being accumulated speculatively.)
Example 2
Same facts as Example 1, except that the skimmed oil requires
processing in the plant's slop oil system. This process involves
demulsifying and separation via chemical addition, thermal
treatment, and gravity separation.
Same answer as in Example 1. It should also be noted that water
and solids from the slop oil system can be wastes, and if hazardous,
can be subject to Subtitle C regulation once they are removed from
the slop oil tank.
Example 3
Same facts as Example 1, except that the source of the recovered
oil is a petrochemical plant wastewater treatment system.
The oil is not excluded from being a solid waste under today's
rule because it does not come from petroleum refining, exploration
or production operations.
Example 4
Facility B recovers oil from spills at exploration and
production operations. The oil is trucked to a tank, where
separation occurs. The separated oil is put into a pipeline for
ultimate insertion into crude oil storage units at a petroleum
refinery.
The oil recovered from the spills is excluded from being a solid
waste. It is a type of recovered oil, and is excluded because it
originates from exploration and production activities, is not land
disposed or accumulated speculatively, and is inserted into a
refining process.
Example 5
Facility C is a bulk petroleum storage facility. Oil spilled
from its product storage tanks is too contaminated to be directly
used as product. The oil is sent back to a refinery where it is
placed in a slop oil system and returned to the refining process.
The spilled oil is excluded from being a solid waste, not under
today's rule, but under Sec. 261.33 (and Sec. 261.2 Table 1) because
it is a commercial chemical product that is being recycled rather
than abandoned. (EPA interprets this principle to apply to
commercial chemical products that exhibit characteristics as well as
those listed in Sec. 261.33. 50 FR 14219 (April 11, 1985).) (This
answer assumes that the oil is recovered promptly and that the
spills do not create permanent land disposal units. See 55 FR 22671
(June 1, 1990).)
All of these answers assume that legitimate recycling is
occurring. See discussion of sham recycling criteria in many prior
Agency notices, such as 53 FR 522 (Jan. 8, 1988) and 56 FR 7143,
7185 (Feb. 21, 1991).
X. Relationship to Other Programs
A. Clean Air Act (Benzene NESHAP)
On January 7, 1993 (58 FR 3072) EPA promulgated under Section 112
of the Clean Air Act (42 U.S.C. 7412) final amendments to the benzene
waste operations national emission standards for hazardous air
pollutants (NESHAP) (V FF at 40 CFR part 61). Sources affected by V FF
include chemical manufacturing plants, by-product recovery plants,
petroleum refineries, and facilities at which waste management units
are used to treat, store, or dispose of waste generated by chemical
manufacturing plants, by-product recovery plants, or petroleum
refineries.
B. Clean Water Act
Today's rule does not affect petroleum facilities' obligations
under the Clean Water Act, and is consistent with the Agency's prior
descriptions of primary wastewater treatment activities at petroleum
refineries as involving wastewater treatment, not recycling of in-
process material.
C. RCRA
1. RCRA Air Emission Standards
EPA has issued regulations that implement portions of RCRA Section
3004(n), which provision requires EPA to issue rules regulating air
emissions resulting from facilities that treat, store, or dispose of
hazardous wastes. 40 CFR parts 264 and 265 Subparts AA and BB. These
rules control organic emissions from vents and equipment leaks from
units managing hazardous wastes, which units either are already subject
to RCRA Subtitle C permitting requirements, or are recycling units
located at facilities which has other units already subject to Subtitle
C permitting requirements.
Today's rule does not affect any units that are subject to
regulation under subparts AA or BB. This is because the units that are
affected by today's rule are not presently subject to Subtitle C
regulation, either because they are wastewater treatment tanks exempt
from regulation under Secs. 264.1(g)(6) and 265.1(c)(10), because they
are recycling units not covered by the Subpart AA or BB regulations
(i.e., are not ``distillation, fractionation, thin-film evaporation,
solvent extraction, or air or steam stripping operation'', see
Secs. 264.1030(b), 264.1050(b), 265.1030(b), and 265.1050(b)) and
otherwise exempt from regulation under Sec. 261.6(c)(1), or because
they manage materials exempt from regulation under Sec. 261.6(a)(3)
(iv), (v) and (vi).
2. Used Oil
Today's rule does not affect petroleum facilities' obligations
under the Used Oil Rule. See generally, 57 FR 41566 (September 10,
1992) and 59 FR 1994 (March 4, 1994). Today's rule excludes from RCRA
Subtitle C requirements only recovered oil as described. Whether or not
recovered oil excluded under today's rule is subject to the used oil
management standards depends on whether or not the recovered oil does
or does not also meet the definition of used oil. Id. The Agency
recently issued a final used oil rule on March 4, 1994 (see 59 FR
10550) which affects the definition of used oil and deals with issues
similar to those in today's rule. According to this final used oil
rule, de minimis quantities of used oil that are incidentally captured
by a refinery's wastewater treatment system and subsequently recovered
along with other oil in a refinery's recovered oil system are not
regulated as used oil. 59 FR 10550 (March 4, 1994).
D. Enforcement; Effect of Today's Final Rule on RCRA 3007, 3013, 7002
and 7003 Authorities
EPA's action today affects only the final regulatory definition of
solid waste. It does not interpret the scope of the term ``solid
waste'' for purposes of the non-regulatory authorities in RCRA Sections
3007, 3013, 7002 and 7003. See 40 CFR Sec. 261.1(b). Thus, for purposes
of those authorities, the Agency (or citizens in the case of citizen
suits under Section 7002(a)(1)(B)) would have the benefit of the full
jurisdictional reach of the statutory definition of solid waste. See
Comite Pro Rescate de la Salud v. Puerto Rico Aqueduct and Sewer
Authority, 888 F. 2d 180, 185 (1st Cir. 1989), cert. denied, 494 U.S.
1029 (1990) (upholding reasonableness of applying narrower definition
for regulatory purposes than for purposes of imminent and substantial
endangerment authority); Connecticut Coastal Fishermen's Association v.
Remington Arms Company, 989 F. 2d 1305 (2d Cir. 1993) (noting potential
appropriateness of applying narrower regulatory definition of solid
waste for determining scope of Subtitle C regulation, but applying
broader statutory definition in non-regulatory contexts such as RCRA
Sections 7002 and 7003).
XI. State Authority
A. Applicability of Rules in Authorized States
Under Section 3006 of RCRA, EPA may authorize qualified States to
administer and enforce the RCRA program within the State. (See 40 CFR
Part 271 for the standards and requirements for authorization.)
Following authorization, authorized States have primary enforcement
responsibility, although EPA retains enforcement authority under
Sections 3008, 7003 and 3013 of RCRA.
Prior to the Hazardous and Solid Waste Amendments of 1984
(``HSWA''), a State with final authorization administered its hazardous
waste program entirely in lieu of EPA administering the Federal program
in that State. The Federal requirements no longer applied in the
authorized State, and EPA could not issue permits for any facilities in
the State which the State was authorized to permit. When new, more
stringent Federal requirements were promulgated or enacted, the State
was obliged to enact equivalent authority within specified time frames.
New Federal requirements did not take effect in an authorized State
until the State adopted the requirements as State law.
In contrast, under Section 3006(g) of RCRA, 42 U.S.C. 6926(g), new
requirements and prohibitions imposed by HSWA take effect in authorized
States at the same time that they take effect in nonauthorized States.
EPA is directed to carry out those requirements and prohibitions in
authorized States, including the issuance of permits, until the State
is granted authorization to do so. While States must still adopt HSWA-
related provisions as State law to retain final authorization, the HSWA
applies in authorized States in the interim.
Today's amendments are not imposed pursuant to HSWA. The rule
changes, therefore, will become effective immediately only in those
States without interim or final authorization, not in authorized
States. The effect of the rule changes on authorized State programs is
discussed next.
B. Effect on Authorized State Programs
Today's rule will not be effective in authorized States since the
requirements are not being imposed pursuant to HSWA. Thus, the
requirements will be applicable only in those States that do not have
interim or final authorization. In authorized States, the requirements
will not be applicable until the State revises its program to adopt
equivalent requirements under State laws.
40 CFR 271.21(e)(2) requires that States that have final
authorization must modify their programs to reflect Federal program
changes and must subsequently submit the modifications to EPA for
approval. However, it should be noted that authorized States are only
required to modify their programs when EPA promulgates Federal
standards that are more stringent or broader in scope than the existing
Federal standards. Section 3009 of RCRA allows States to impose
standards more stringent than those in the Federal program. For those
Federal program changes that are less stringent or reduce the scope of
the Federal program, States are not required to modify their programs.
See 40 CFR 271.1(k). Today's amendments to Sec. 261.4 reduce the scope
of the existing Federal requirements. Therefore, authorized States will
not be required to modify their programs to adopt requirements
equivalent or substantially equivalent to the provisions proposed
today.
However, as noted above, States are required by Sec. 271.21 to
revise their programs to reflect Federal program changes. 51 FR 33722
(September 22, 1986). A number of States qualified for final
authorization prior to being required to adopt the redefinition of
solid waste rulemaking of January 4, 1985 (50 FR 614). Since the
January 4, 1985 rule is more stringent than the rule under which such
States were authorized, such States were required to revise their
programs in accordance with Part 271.21. Today's changes will not
preclude EPA's ability to authorize States which have subsequently
adopted the January 4, 1985 rule since it would reduce the scope of the
Federal requirements. However, certain aspects of the State's
regulation will be broader in scope than the Federal program and
therefore not part of the authorized State program. This means that
while they are enforceable under State law, they are not subject to
Federal enforcement.
40 CFR 271.21(e) provides for extensions of time at the discretion
of the Regional Administrator for States to adopt changes to their
regulations and/or statutes to conform to change in the Federal
program. The question arises, however, of whether States which have not
yet adopted the January 4 rule must adhere to EPA's published
compliance schedules for such adoption. Where States have delayed
rulemaking pending today's rulemaking clarifying the impact of the
court's decision, the EPA Regional Administrators may be flexible in
further extending the modification deadlines. EPA Regional
Administrators should take into account the States' regulatory and/or
legislative procedures in deciding what further extensions may be
warranted. However, any States which have delayed rulemaking should now
proceed to expeditiously adopt the January 4, 1985 rules as amended by
today's notice.
XII. Regulatory Requirements
A. Regulatory Impact Analysis Pursuant to Executive Order No. 12866
Under Executive Order No. 12866 [58 FR 51735 (October 4, 1993)],
the Agency must determine whether the regulatory action is
``significant'' and therefore subject to OMB review and the
requirements of the Executive Order. The Order defines ``significant
regulatory action'' as one that is likely to result in a rule that may:
(1) have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or tribal governments or
communities; (2) create serious inconsistency or otherwise interfere
with an action taken or planned by another agency; (3) materially alter
the budgetary impact of entitlements, grants, user fees, or loan
programs or the rights and obligations of recipients thereof; or (4)
raise novel legal or policy issues arising out of legal mandates, the
President's priorities, or the principles set forth in the Executive
Order.
It has been determined that this rule is not a ``significant
regulatory action'' under the terms of Executive Order 12866 and is
therefore not subject to OMB review.
B. Regulatory Flexibility Act
The Regulatory Flexibility Act of 1980 (Pub. L. 96-354), requires
Federal regulatory agencies to consider the impact of rulemaking on
``small entities.'' If a rulemaking will have a significant impact on a
substantial number of small entities, agencies must consider regulatory
alternatives that minimize economic impact.
Today's rulemaking does not have a significant impact on any small
entity. Rather, it excludes from the definition of solid waste certain
petroleum materials being recycled within the petroleum industry.
Accordingly, this deregulatory action will not add any economic burdens
to any affected entities, small or large, and a regulatory flexibility
analysis is not required. Therefore, the Administrator certifies
pursuant to 5 U.S.C. 601 et seq., that this rule will not have a
significant impact on a substantial number of small entities because
today's amendments reduce the scope of the Subtitle C regulatory
program.
C. Paperwork Reduction Act
Under the Paperwork Reduction Act, 44 U.S.C. 3501 et seq., EPA must
consider the paperwork burden imposed by any information collection
request in a proposed or final rule. This rule will not impose any new
information collection requirements.
List of Subjects
40 CFR Part 261
Environmental protection, Hazardous waste, Solid waste, Petroleum,
Recycling.
40 CFR Part 266
Environmental protection, Energy, Hazardous waste, Petroleum,
Recycling.
Dated: July 15, 1994.
Carol M. Browner,
Administrator.
For the reasons set out in the preamble, Chapter I of title 40 of
the Code of Federal Regulations is amended as follows:
PART 261--IDENTIFICATION AND LISTING OF HAZARDOUS WASTE
1. The authority citation for part 261 continues to read as
follows:
Authority: 42 U.S.C. 6905, 6912(a), 6921, 6922, and 6938.
2. In Sec. 261.3, paragraph (c)(2)(ii)(B) is revised to read as
follows:
Sec. 261.3 Definition of hazardous waste.
* * * * *
(c) * * *
(2) * * *
(ii) * * *
(B) Waste from burning any of the materials exempted from
regulation by Sec. 261.6(a)(3) (iv) through (vi).
* * * * *
3. A new paragraph (a)(12) is added to Sec. 261.4 to read as
follows:
Sec. 261.4 Exclusions.
* * * * *
(a) * * *
(12) Recovered oil from petroleum refining, exploration and
production, and from transportation incident thereto, which is to be
inserted into the petroleum refining process (SIC Code 2911) along with
normal process streams prior to crude distillation or catalytic
cracking. This exclusion applies to recovered oil stored or transported
prior to insertion, except that the oil must not be stored in a manner
involving placement on the land, and must not be accumulated
speculatively, before being so recycled. Recovered oil is oil that has
been reclaimed from secondary materials (such as wastewater) generated
from normal petroleum refining, exploration and production, and
transportation practices. Recovered oil includes oil that is recovered
from refinery wastewater collection and treatment systems, oil
recovered from oil and gas drilling operations, and oil recovered from
wastes removed from crude oil storage tanks. Recovered oil does not
include (among other things) oil-bearing hazardous wastes listed in 40
CFR part 261 D (e.g., K048-K052, F037, F038). However, oil recovered
from such wastes may be considered recovered oil. Recovered oil also
does not include used oil as defined in 40 CFR 279.1.
4. In Sec. 261.6, paragraph (a)(3)(v) is removed, paragraph
(a)(3)(vi) is redesignated as (a)(3)(v), and paragraph (a)(3)(vii) is
redesignated as (a)(3)(vi). Section 261.6 is further amended by
revising paragraphs (a)(3)(iv) and newly redesignated (a)(3)(vi) to
read as follows:
Sec. 261.6 Requirements for recyclable materials.
* * * * *
(a) * * *
(3) * * *
(iv) Fuels produced from the refining of oil-bearing hazardous
waste along with normal process streams at a petroleum refining
facility if such wastes result from normal petroleum refining,
production, and transportation practices (this exemption does not apply
to fuels produced from oil recovered from oil-bearing hazardous waste,
where such recovered oil is already excluded under Sec. 261.4(a)(12);
* * * * *
(vi) Petroleum coke produced from petroleum refinery hazardous
wastes containing oil by the same person who generated the waste,
unless the resulting coke product exceeds one or more of the
characteristics of hazardous waste in part 261, subpart C.
* * * * *
PART 266--STANDARDS FOR THE MANAGEMENT OF SPECIFIC HAZARDOUS WASTES
AND SPECIFIC TYPES OF HAZARDOUS WASTE MANAGEMENT FACILITIES
5. The authority cite for part 266 continues to read as follows:
Authority: 42 U.S.C. 6905, 6912(a), 6924, and 6934.
6. Section 266.100(b)(3) is revised to read as follows:
Sec. 266.100 Applicability.
* * * * *
(b) * * *
(3) Hazardous wastes that are exempt from regulation under
Secs. 261.4 and 261.6(a)(3) (iv) through (vi) of this chapter, and
hazardous wastes that are subject to the special requirements for
conditionally exempt small quantity generators under Sec. 261.5 of this
chapter; and
* * * * *
[FR Doc. 94-18452 Filed 7-27-94; 8:45 am]
BILLING CODE 6560-50-P
