EPA is proposing - Petroleum Equipment Institute

final RFS2 program requirements by December 19, 2008. As a result, we are proposingthat the RFS2 regulatory program go into effect on January 1, 2010.In order to successfully implement the RFS2 program, parties that generate RINs,own and/or transfer them, or use them for compliance purposes will need to re-registerunder the RFS2 provisions and modify their information technology (IT) systems toaccommodate the changes we are proposing today. As described more fully in SectionIII, these changes would include redefining the D code within the RIN, adding a processfor verifying that feedstocks meet the renewable biomass definition, and calculatingcompliance with four standards instead of one. Regulated parties will need to establishnew contractual relationships to cover the different types of renewable fuel requiredunder RFS2. Parties that produce MVNRLM diesel but not gasoline will be newlyobligated parties and may be establishing IT systems for the RFS program for the firsttime. For RFS1, regulated parties had four months between promulgation of the finalrulemaking on May 1, 2007 and the start of the program on September 1, 2007.However, this was for a new program that had not existed before. For the RFS2 program,most regulated parties will already be familiar with the general requirements for RINgeneration, transfer, and use, and the attendant recordkeeping and reporting requirements.We believe that with proper attention to the implementation requirements by regulatedparties, the RFS2 program can be implemented on January 1, 2010 following release ofthe final rule.Although we are proposing that the RFS2 regulatory program begin on January 1,2010, we seek comment on whether a start date later than January 1, 2010 would benecessary. Alternative effective dates for the RFS2 program include January 1, 2011 anda date after January 1, 2010 but before January 1, 2011. We are requesting comment onall issues related to such an alternative effective date, including the need for such adelayed start, treatment of diesel producers and importers, whether the standards foradvanced biofuel, cellulosic biofuel and biomass-based diesel should apply to the entire2010 production or just the production that would occur after the RFS2 effective date,and the extent to which RFS1 RINs should be valid to show compliance with RFS2standards. Further discussion of alternative effective dates for RFS2 can be found inSection III.E.1.d.6. Treatment of Required Volumes Preceding the RFS2 Effective DateWe are proposing that the RFS2 regulatory program begin on January 1, 2010.Under CAA section 211(o), the requirements for refiners, blenders, and importers (called“obligated parties”) as well as the requirements for producers of renewable fuel andothers, stem from the regulatory provisions adopted by EPA. In effect while EPAct andEISA both call for EPA to issue regulations that achieve certain results, the variousregulated parties are not subject to these requirements until EPA issues the regulationsestablishing their obligations. The changes brought about by EISA, such as the 4separate standards, the lifecycle GHG thresholds, changes to obligated parties, and therevised definition of renewable biomass do not become effective until today's proposal is28