Regulation of Fuels and Fuel Additives: Renewable Fuel Standard ...

capability for all of the small refiner’s refineries of 155,000 barrels per calendar year
(bpcd). These size requirements were established in prior rulemakings and were the
result of our analysis of small refiner impacts. We do not believe that there are more than
three gasoline refineries owned by small refiners that meet these criteria and that
currently exceed the 75,000 bpcd crude oil processing capability defined by the Act. We
request comment on whether a refiner who has a refinery which exceeds the 75,000 bpcd
criteria should be eligible to apply for a small refiner exemption under the RFS program.
EPA believes it has this discretion in determining an appropriate lead-time for the startup
of this program, as well as discretion to determine the regulated refiners, blenders and
importers, “as appropriate.”
We are also proposing to allow foreign refiners to apply for a small refinery or
small refiner exemption under the RFS program. This would apply to foreign refiners
that apply for refineries under the 75,000 bpcd criteria or foreign refiners that apply for
small refiner status. Under the anti-dumping, MSAT and gasoline sulfur rules, foreign
refiners are allowed to comply with certain regulations separately from any importer.
Additional requirements applicable to such foreign refiners are included in these rules to
ensure that enforcement of the regulations at the foreign refinery would not be
compromised. We are proposing similar enforcement-related requirements that would
apply to foreign refiners that apply for a small refinery or small refiner exemption. Under
the existing fuels regulations, few foreign refiners have chosen to undertake these
additional requirements, and almost all gasoline produced at foreign refineries is included
in the importers’ compliance determinations. We invite comment on the value of
extending the small refinery and small refiner exemptions to foreign refiners under the
RFS program.
Under the proposed rule, applications for a small refinery exemption must be
received by EPA by September 1, 2007 for the exemption to be effective in 2007 and
subsequent calendar years. The application must include documentation that the small
refinery’s average aggregate daily crude oil throughput for calendar year 2004 did not
exceed 75,000 barrels. As long as the refinery met the criteria in 2004, it would have the
exemption through 2010 regardless of changes in crude throughput or ownership. A
small refinery exemption would be effective 60 days after receipt of the application by
EPA unless EPA notifies the applicant that the application was not approved or that
additional documentation is required. We are proposing to base eligibility on 2004 data
rather than on 2005 data, since it was the first full year prior to passage of the Energy
Act. In addition, some refineries’ production may have been affected by Hurricane
Katrina in 2005. We request comment on whether multiple-year average should be the
basis for eligibility.
As discussed above, refiners that do not qualify for a small refinery exemption
under the 75,000 bpcd criteria, but nevertheless meet the criteria of a small refiner may
apply for small refiner status under the RFS rule. The application must be received by
EPA by September 1, 2007 for the exemption to be effective in 2007 and subsequent
calendar years. Like the exemption for small refineries, small refiner status would be
determined based on documentation submitted in the application which demonstrates that
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