[Federal Register Volume 85, Number 226 (Monday, November 23, 2020)]
[Notices]
[Pages 74772-74775]
[FR Doc No: 2020-25729]

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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-90437; File No. SR-CboeEDGX-2020-054]

Self-Regulatory Organizations; Cboe EDGX Exchange, Inc.; Notice
of Filing and Immediate Effectiveness of a Proposed Rule Change To
Amend Its Interpretations and Policies to Rule 21.20 in Connection With
Market Makers' Complex Orders, Quoting Obligations and Volume

November 17, 2020.
    Pursuant to Section 19(b)(1) of the Securities Exchange Act of 1934
(the ``Act''),\1\ and Rule 19b-4 thereunder,\2\ notice is hereby given
that on November 3, 2020, Cboe EDGX Exchange, Inc. (the ``Exchange'' or
``EDGX'') filed with the Securities and Exchange Commission (the
``Commission'') the proposed rule change as described in Items I, II,
and III below, which Items have been prepared by the Exchange. The
Exchange filed the proposal pursuant to Section 19(b)(3)(A)(iii) of the
Act \3\ and Rule 19b-4(f)(6) thereunder.\4\ The Commission is
publishing this notice to solicit comments on the proposed rule change
from interested persons.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ 15 U.S.C. 78s(b)(3)(A)(iii).
    \4\ 17 CFR 240.19b-4(f)(6).
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I. Self-Regulatory Organization's Statement of the Terms of Substance
of the Proposed Rule Change

    Cboe EDGX Exchange, Inc. (the ``Exchange'' or ``EDGX'') proposes to
amend its Interpretations and Policies to Rule 21.20 in connection with
Market Makers' complex orders, quoting obligations and volume. The text
of the proposed rule change is provided in Exhibit 5.
    The text of the proposed rule change is also available on the
Exchange's website (http://markets.cboe.com/us/options/regulation/rule_filings/edgx/), at the Exchange's Office of the Secretary, and at
the Commission's Public Reference Room.

II. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

    In its filing with the Commission, the Exchange included statements
concerning the purpose of and basis for the proposed rule change and
discussed any comments it received on the proposed rule change. The
text of these statements may be examined at the places specified in
Item IV below. The

Exchange has prepared summaries, set forth in sections A, B, and C
below, of the most significant aspects of such statements.

A. Self-Regulatory Organization's Statement of the Purpose of, and
Statutory Basis for, the Proposed Rule Change

1. Purpose
    The Exchange proposes to adopt new Interpretation and Policy .02 to
Rule 21.20 which provides that complex strategies are included when
determining whether a Market Maker exceeds the 25% volume threshold in
its non-appointed classes pursuant to Rule 22.6(f).\5\ The Exchange
also proposes to make clarifying, nonsubstantive updates to
Interpretation and Policy .01 to Rule 21.20.
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    \5\ As a result of the proposed Interpretation and Policy, the
proposed rule change accordingly updates the subsequent
Interpretation and Policy numbering.
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    Rule 21.20 governs trading of complex orders on the Exchange and,
currently, Interpretation and Policy .01 to Rule 21.20 specifically
provides that Market Makers are not required to quote on the COB.
Complex strategies are not subject to any quoting requirements that are
applicable to Market Makers in the simple market for individual options
series or classes. Interpretation and Policy .01 to Rule 21.20 also
states that volume executed in complex strategies is not taken into
consideration when determining whether Market Makers are meeting
quoting obligations applicable to Market Makers in the simple market
for individual options. The proposed rule change updates Interpretation
and Policy .01 to Rule 21.20 in order to provide additional clarity and
consistency with the rules that provide for a Market-Maker's quoting
requirements and obligations. Specifically, pursuant to Rule 22.6, a
Market-Maker must satisfy quoting obligations in each of its appointed
classes. As such, the proposed [sic] updates Interpretation and Policy
.01 to Rule 21.20 to make it clear that a Market-Maker's orders in
complex strategies are not subject to a Market-Maker's quoting
requirements in its appointed classes nor are considered in determining
whether a Market-Maker has satisfied its quoting obligations in its
appointed classes. Also, the proposed rule change updates
Interpretation and Policy .01 to Rule 21.20 as it inadvertently refers
to volume executed rather than orders, as ``quoting'' obligations
relate to the submission of quotes and orders rather than executed
volume. More specifically, pursuant to Rule 22.6, a Market-Maker's bids
and offers entered in the simple market are considered in determining
whether a Market-Maker satisfies its quoting obligations, therefore,
the proposed rule change amends Interpretation and Policy .01 to Rule
21.20 to more appropriately reflect this. The proposed change also
updates the language in Interpretation and Policy .01 to read in plain
English.
    Current Rule 22.6(f) provides that a Market-Maker is considered an
order entry firm (``OEF'') \6\ under the Rules in all classes in which
the Market-Maker has no appointment, and limits the total number of
contracts a Market-Maker may execute in classes in which it has no
appointment to 25% of the total number of all contracts the Market-
Marker executes on the Exchange in any calendar quarter. The Exchange
does not currently include executed complex order volume when
determining whether a Market-Maker has exceeded this threshold. The
Exchange's affiliated options exchange, Cboe Exchange, Inc. (``Cboe
Options'') has a rule in place that is substantially the same as EDGX
Rule 22.6(f); however, Cboe Options currently considers a Market
Maker's executed complex order volume as well as a Market Maker's
executed simple order volume in determining whether a Market-Maker has
exceeded the 25% volume threshold in its non-appointed classes.\7\ In
order to harmonize this practice across the affiliated options
exchanges,\8\ the Exchange now proposes to change its current
interpretation and adopt proposed Interpretation and Policy .02 to Rule
20.21 to provide that a Market-Maker's orders for complex strategies
executed in classes in which it has no appointment are included in the
total number of all contracts the Market-Maker executes on the Exchange
in any calendar quarter in determining whether the Market-Maker exceeds
the 25% threshold pursuant to Rule 22.6(f). The Exchange notes that
Rule 22.6(f) is designed to prevent a Market-Maker from executing
volume in non-appointed option classes in an amount disproportionate to
volume executed in its appointed option classes, potentially in
derogation of the performance of its obligations and provision of
liquidity in its appointed option classes. As such, the proposed rule
change is consistent with and supports the purposed [sic] of Rule
22.6(f) by including complex orders in this calculation. Therefore, the
proposed rule change considers a Market-Maker's orders executed in
complex strategies representative of a Market-Maker's total volume on
the Exchange.
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    \6\ See Rule 16.1., which defines an ``Options Order Entry
Firm'' and ``Order Entry Firm'' or ``OEF'' as those Options Members
representing as agent Customer Orders on EDGX Options and those non-
Market Maker Members conducting proprietary trading.
    \7\ The Exchange notes too that Cboe Options intends to
simultaneously submit a rule filing to codify its current practice
in calculating its Market-Makers' simple and complex volume in non-
appointed classes in its corresponding Interpretations and Policies
to Rule 21.20.
    \8\ The Exchange's affiliated options exchange, Cboe C2
Exchange, Inc. (``C2'') intends to simultaneously submit a
substantively identical rule filing to clarify that it will
calculate its Market Makers' simple and complex volume in non-
appointed classes pursuant to Cboe Options' current practice.
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2. Statutory Basis
    The Exchange believes the proposed rule change is consistent with
the Securities Exchange Act of 1934 (the ``Act'') and the rules and
regulations thereunder applicable to the Exchange and, in particular,
the requirements of Section 6(b) of the Act.\9\ Specifically, the
Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \10\ requirements that the rules of an exchange be
designed to prevent fraudulent and manipulative acts and practices, to
promote just and equitable principles of trade, to foster cooperation
and coordination with persons engaged in regulating, clearing,
settling, processing information with respect to, and facilitating
transactions in securities, to remove impediments to and perfect the
mechanism of a free and open market and a national market system, and,
in general, to protect investors and the public interest. Additionally,
the Exchange believes the proposed rule change is consistent with the
Section 6(b)(5) \11\ requirement that the rules of an exchange not be
designed to permit unfair discrimination between customers, issuers,
brokers, or dealers.
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    \9\ 15 U.S.C. 78f(b).
    \10\ 15 U.S.C. 78f(b)(5).
    \11\ Id.
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    In particular, the Exchange believes the proposed rule change will
remove impediments to and perfect the mechanism of a free and open
market and a national market system by providing that the Exchange
considers a Market-Maker's complex order volume when calculating the
25% threshold of volume in non-appointed classes pursuant to Rule
22.6(f) and thereby harmonizing the Exchange's rules with that of the
corresponding rules of its affiliated options exchanges.\12\
Specifically, Rule 22.6(f) is designed to prevent a Market-Maker from
executing volume in non-appointed option classes in an amount
disproportionate to

volume executed in its appointed option classes, potentially in
derogation of the performance of its obligations and provision of
liquidity in its appointed option classes. As stated above, the
Exchange believes that a Market-Maker's orders executed in complex
strategies are representative of a Market-Maker's total volume on the
Exchange. Thus, including such in its calculation of volume in non-
appointed classes will help to ensure that Market-Makers perform their
obligations and provide liquidity in appointed classes in an
appropriate manner as compared to non-appointed classes, and is thereby
consistent with and supports the purpose of Rule 22.6(f). The Exchange
also believes that codifying that a Market-Maker's complex order volume
counts towards its Market-Maker's total volume on the Exchange may
mitigate any potential confusion regarding this calculation so that
Market-Makers have more clarity regarding their obligations in
appointed classes in an appropriate manner as compared to non-appointed
classes. As such, the Exchange believes the proposed rule change will
contribute to the protection of investors and the public interest by
adding transparency and clarity to the Exchange's Rules by codifying
its affiliated options exchange's current interpretation of how to
[sic] a Market-Maker's executed volume on the Exchange is calculated.
In addition, the Exchange believes the proposed changes to
Interpretation and Policy .01 of Exchange Rule 21.20 will add clarity
by revising the Rule to provide that orders entered in appointed
classes, rather than volume executed, is considered in connection with
determining whether a Market-Maker meets it quoting obligations
pursuant to 22.6 in its appointed classes as well as updating the
language to read in plain English.
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    \12\ See supra notes 7 and 8.
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B. Self-Regulatory Organization's Statement on Burden on Competition

    The Exchange does not believe that the proposed rule change will
impose any burden on competition that is not necessary or appropriate
in furtherance of the purposes of the Act. The Exchange reiterates that
the proposed rule change is intended to codify in new Interpretation
and Policy .02 to Rule 21.20 that the Exchange will consider a Market-
Maker's complex strategy execution volume in calculating its volume per
quarter pursuant to Rule 22.6(f) and harmonize this calculation with
the manner in which the exchange's affiliated options exchange, Cboe
Options, currently calculates Market-Maker executed volume in non-
appointed classes. The proposed rule change also corrects an
inadvertent error in Interpretation and Policy .01 to 21.20 indicating
that executed volume rather than entered orders are considered when
determining compliance with a Market-Maker's quoting obligations. Thus,
the Exchange believes this proposed rule change will benefit Exchange
participants by providing specific guidance and additional clarity
within the Exchange Rules, as well as between the rules of the
affiliated options exchanges.
    Additionally, the Exchange believes that the proposed rule change
regarding the applicability of Rule 22.6(f) to a Market-Maker's
executions in the COB does not impose any burden on intramarket
competition because it applies to all Market-Makers in the same manner.
The proposed rule change codifies its affiliated options exchange's
existing interpretation of such calculation in its corresponding rules.
It does not modify any existing Market-Maker obligations. The Exchange
believes that the proposed rule change does not impose any burden on
intermarket competition because it relates to an obligation regarding
Market-Maker executed volume only on the Exchange.
    The Exchange believes that the proposed rule change will relieve
any burden on market participants because it serves to provide Market-
Makers with rules that ensure that Market-Makers are performing their
obligations in appointed options classes in an appropriate manner as
compared to non-appointed classes. Ensuring that Market-Makers execute
a certain amount of their volume in appointed classes will contribute
to sufficient liquidity in those classes, which benefits the market and
investors as a whole.
    Additionally, the proposed nonsubstantive updates to Interpretation
and Policy .01 to Rule 21.20 are not competitive in nature and,
instead, are intended to correct an inadvertently used term and provide
clarity and consistency within the Rules.

C. Self-Regulatory Organization's Statement on Comments on the Proposed
Rule Change Received From Members, Participants, or Others

    The Exchange neither solicited nor received comments on the
proposed rule change.

III. Date of Effectiveness of the Proposed Rule Change and Timing for
Commission Action

    Because the foregoing proposed rule change does not:
    A. Significantly affect the protection of investors or the public
interest;
    B. impose any significant burden on competition; and
    C. become operative for 30 days from the date on which it was
filed, or such shorter time as the Commission may designate, it has
become effective pursuant to Section 19(b)(3)(A) of the Act \13\ and
Rule 19b-4(f)(6) \14\ thereunder. At any time within 60 days of the
filing of the proposed rule change, the Commission summarily may
temporarily suspend such rule change if it appears to the Commission
that such action is necessary or appropriate in the public interest,
for the protection of investors, or otherwise in furtherance of the
purposes of the Act. If the Commission takes such action, the
Commission will institute proceedings to determine whether the proposed
rule change should be approved or disapproved.
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    \13\ 15 U.S.C. 78s(b)(3)(A).
    \14\ 17 CFR 240.19b-4(f)(6).
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IV. Solicitation of Comments

    Interested persons are invited to submit written data, views, and
arguments concerning the foregoing, including whether the proposed rule
change is consistent with the Act. Comments may be submitted by any of
the following methods:

Electronic Comments

     Use the Commission's internet comment form (http://www.sec.gov/rules/sro.shtml); or
     Send an email to<EMAIL_ADDRESS>Please include
File Number SR-CboeEDGX-2020-054 on the subject line.

Paper Comments

     Send paper comments in triplicate to Secretary, Securities
and Exchange Commission, 100 F Street NE, Washington, DC 20549-1090.

All submissions should refer to File Number SR-CboeEDGX-2020-054. This
file number should be included on the subject line if email is used. To
help the Commission process and review your comments more efficiently,
please use only one method. The Commission will post all comments on
the Commission's internet website (http://www.sec.gov/rules/sro.shtml).
Copies of the submission, all subsequent amendments, all written
statements with respect to the proposed rule change that are filed with
the Commission, and all written communications relating to the proposed
rule change between the Commission and any person, other than those
that may be withheld from the public in accordance with the

provisions of 5 U.S.C. 552, will be available for website viewing and
printing in the Commission's Public Reference Room, 100 F Street NE,
Washington, DC 20549, on official business days between the hours of
10:00 a.m. and 3:00 p.m. Copies of the filing also will be available
for inspection and copying at the principal office of the Exchange. All
comments received will be posted without change. Persons submitting
comments are cautioned that we do not redact or edit personal
identifying information from comment submissions. You should submit
only information that you wish to make available publicly. All
submissions should refer to File Number SR-CboeEDGX-2020-054, and
should be submitted on or before December 14, 2020.
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    \15\ 17 CFR 200.30-3(a)(12).

    For the Commission, by the Division of Trading and Markets,
pursuant to delegated authority.\15\
J. Matthew DeLesDernier,
Assistant Secretary.
[FR Doc. 2020-25729 Filed 11-20-20; 8:45 am]
BILLING CODE 8011-01-P


[Federal Register Volume 83, Number 203 (Friday, October 19, 2018)]
[Notices]
[Pages 53067-53068]
[FR Doc No: 2018-22806]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Food and Drug Administration

[Docket Nos. FDA-2017-E-6544 and FDA-2017-E-6542]

Determination of Regulatory Review Period for Purposes of Patent
Extension; IMFINZI

AGENCY: Food and Drug Administration, HHS.

ACTION: Notice.

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SUMMARY: The Food and Drug Administration (FDA or the Agency) has
determined the regulatory review period for IMFINZI and is publishing
this notice of that determination as required by law. FDA has made the
determination because of the submission of applications to the Director
of the U.S. Patent and Trademark Office (USPTO), Department of
Commerce, for the extension of a patent which claims that human
biological product.

DATES: Anyone with knowledge that any of the dates as published (see
the SUPPLEMENTARY INFORMATION section) are incorrect may submit either
electronic or written comments and ask for a redetermination by
December 18, 2018. Furthermore, any interested person may petition FDA
for a determination regarding whether the applicant for extension acted
with due diligence during the regulatory review period by April 17,
2019. See ``Petitions'' in the SUPPLEMENTARY INFORMATION section for
more information.

ADDRESSES: You may submit comments as follows. Please note that late,
untimely filed comments will not be considered. Electronic comments
must be submitted on or before April 17, 2019. The https://www.regulations.gov electronic filing system will accept comments until
11:59 p.m. Eastern Time at the end of April 17, 2019. Comments received
by mail/hand delivery/courier (for written/paper submissions) will be
considered timely if they are postmarked or the delivery service
acceptance receipt is on or before that date.

Electronic Submissions

    Submit electronic comments in the following way:
     Federal eRulemaking Portal: https://www.regulations.gov.
Follow the instructions for submitting comments. Comments submitted
electronically, including attachments, to https://www.regulations.gov
will be posted to the docket unchanged. Because your comment will be
made public, you are solely responsible for ensuring that your comment
does not include any confidential information that you or a third party
may not wish to be posted, such as medical information, your or anyone
else's Social Security number, or confidential business information,
such as a manufacturing process. Please note that if you include your
name, contact information, or other information that identifies you in
the body of your comments, that information will be posted on https://www.regulations.gov.
     If you want to submit a comment with confidential
information that you do not wish to be made available to the public,
submit the comment as a written/paper submission and in the manner
detailed (see ``Written/Paper Submissions'' and ``Instructions'').

Written/Paper Submissions

    Submit written/paper submissions as follows:
     Mail/Hand delivery/Courier (for written/paper
submissions): Dockets Management Staff (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.
     For written/paper comments submitted to the Dockets
Management Staff, FDA will post your comment, as well as any
attachments, except for information submitted, marked and identified,
as confidential, if submitted as detailed in ``Instructions.''
    Instructions: All submissions received must include the Docket Nos.
FDA-2017-E-6544 and FDA-2017-E-6542 for ``Determination of Regulatory
Review Period for Purposes of Patent Extension; IMFINZI.'' Received
comments, those filed in a timely manner (see ADDRESSES), will be
placed in the docket and, except for those submitted as ``Confidential
Submissions,'' publicly viewable at https://www.regulations.gov or at
the Dockets Management Staff between 9 a.m. and 4 p.m., Monday through
Friday.
     Confidential Submissions--To submit a comment with
confidential information that you do not wish to be made publicly
available, submit your comments only as a written/paper submission. You
should submit two copies total. One copy will include the information
you claim to be confidential with a heading or cover note that states
``THIS DOCUMENT CONTAINS CONFIDENTIAL INFORMATION.'' The Agency will
review this copy, including the claimed confidential information, in
its consideration of comments. The second copy, which will have the
claimed confidential information redacted/blacked out, will be
available for public viewing and posted on https://www.regulations.gov.
Submit both copies to the Dockets Management Staff. If you do not wish
your name and contact information to be made publicly available, you
can provide this information on the cover sheet and not in the body of
your comments and you must identify this information as
``confidential.'' Any information marked as ``confidential'' will not
be disclosed except in accordance with Sec.  10.20 (21 CFR 10.20) and
other applicable disclosure law. For more information about FDA's
posting of comments to public dockets, see 80 FR 56469, September 18,
2015, or access the information at: https://www.gpo.gov/fdsys/pkg/FR-2015-09-18/pdf/2015-23389.pdf.
    Docket: For access to the docket to read background documents or
the electronic and written/paper comments received, go to https://www.regulations.gov and insert the docket number, found in brackets in
the heading of this document, into the ``Search'' box and follow the
prompts and/or go to the Dockets Management Staff, 5630 Fishers Lane,
Rm. 1061, Rockville, MD 20852.

FOR FURTHER INFORMATION CONTACT: Beverly Friedman, Office of Regulatory
Policy, Food and Drug Administration, 10903 New Hampshire Ave. Bldg.
51, Rm. 6250, Silver Spring, MD 20993,<PHONE_NUMBER>.

SUPPLEMENTARY INFORMATION:

I. Background

    The Drug Price Competition and Patent Term Restoration Act of 1984
(Pub. L. 98-417) and the Generic Animal Drug and Patent Term
Restoration Act (Pub. L. 100-670) generally provide that a patent may
be extended for a period of up to 5 years so long as the patented item
(human drug product, animal drug product, medical device, food
additive, or color additive) was subject to regulatory

review by FDA before the item was marketed. Under these acts, a
product's regulatory review period forms the basis for determining the
amount of extension an applicant may receive.
    A regulatory review period consists of two periods of time: a
testing phase and an approval phase. For human biological products, the
testing phase begins when the exemption to permit the clinical
investigations of the biological product becomes effective and runs
until the approval phase begins. The approval phase starts with the
initial submission of an application to market the human biological
product and continues until FDA grants permission to market the
biological product. Although only a portion of a regulatory review
period may count toward the actual amount of extension that the
Director of USPTO may award (for example, half the testing phase must
be subtracted as well as any time that may have occurred before the
patent was issued), FDA's determination of the length of a regulatory
review period for a human biological product will include all of the
testing phase and approval phase as specified in 35 U.S.C.
156(g)(1)(B).
    FDA has approved for marketing the human biologic product IMFINZI
(durvalumab). IMFINZI is indicated for the treatment of patients with
locally advanced or metastatic urothelial carcinoma who have disease
progression during or following platinum-containing chemotherapy or who
have disease progression within 12 months of neoadjuvant or adjuvant
treatment with platinum-containing chemotherapy. This indication is
approved under accelerated approval based on tumor response rate and
duration of response. Continued approval for this indication may be
contingent upon verification and description of clinical benefit in
confirmatory trials. Subsequent to this approval, the USPTO received a
patent term restoration application for IMFINZI (U.S. Patent Nos.
8,779,108 and 9,493,565) from MedImmune Limited, and the USPTO
requested FDA's assistance in determining the patents' eligibility for
patent term restoration. In a letter dated, January 9, 2018, FDA
advised the USPTO that this human biological product had undergone a
regulatory review period and that the approval of IMFINZI represented
the first permitted commercial marketing or use of the product.
Thereafter, the USPTO requested that FDA determine the product's
regulatory review period.

II. Determination of Regulatory Review Period

    FDA has determined that the applicable regulatory review period for
IMFINZI is 1,755 days. Of this time, 1,554 days occurred during the
testing phase of the regulatory review period, while 201 days occurred
during the approval phase. These periods of time were derived from the
following dates:
    1. The date an exemption under section 505(i) of the Federal Food,
Drug, and Cosmetic Act (21 U.S.C. 355(i)) became effective: July 13,
2012. FDA has verified the applicant's claim that the date the initial
investigational new drug application became effective was on July 13,
2012.
    2. The date the application was initially submitted with respect to
the human biological product under section 351 of the Public Health
Service Act (42 U.S.C. 262): October 13, 2016. FDA has verified the
applicant's claim that the biologics license application (BLA) for
IMFINZI (BLA 761069) was initially submitted on October 13, 2016.
    3. The date the application was approved: May 1, 2017. FDA has
verified the applicant's claim that BLA 761069 was approved on May 1,
2017.
    This determination of the regulatory review period establishes the
maximum potential length of a patent extension. However, the USPTO
applies several statutory limitations in its calculations of the actual
period for patent extension. In its application for patent extension,
this applicant seeks 159 days of patent term extension.

III. Petitions

    Anyone with knowledge that any of the dates as published are
incorrect may submit either electronic or written comments and, under
21 CFR 60.24, ask for a redetermination (see DATES). Furthermore, as
specified in Sec.  60.30 (21 CFR 60.30), any interested person may
petition FDA for a determination regarding whether the applicant for
extension acted with due diligence during the regulatory review period.
To meet its burden, the petition must comply with all the requirements
of Sec.  60.30, including but not limited to: must be timely (see
DATES), must be filed in accordance with Sec.  10.20, must contain
sufficient facts to merit an FDA investigation, and must certify that a
true and complete copy of the petition has been served upon the patent
applicant. (See H. Rept. 857, part 1, 98th Cong., 2d sess., pp. 41-42,
1984.) Petitions should be in the format specified in 21 CFR 10.30.
    Submit petitions electronically to https://www.regulations.gov at
Docket No. FDA-2013-S-0610. Submit written petitions (two copies are
required) to the Dockets Management Staff (HFA-305), Food and Drug
Administration, 5630 Fishers Lane, Rm. 1061, Rockville, MD 20852.

    Dated: October 15, 2018.
Leslie Kux,
Associate Commissioner for Policy.
[FR Doc. 2018-22806 Filed 10-18-18; 8:45 am]
 BILLING CODE 4164-01-P


[Federal Register: March 10, 2010 (Volume 75, Number 46)]
[Notices]
[Page 11149-11150]
[DOCID:fr10mr10-56]

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DEPARTMENT OF ENERGY

Federal Energy Regulatory Commission

[Project No. 13526-001]

Bowersock Mills and Power Company; Notice of Application Tendered
for Filing With the Commission; Intent To Waive Stage I and Stage II
Pre-Filing Consultation Requirements and Scoping; Soliciting Additional
Study Requests; and Establishing Procedural Schedule for Licensing

March 3, 2010.
    Take notice that the following hydroelectric application has been
filed with the Commission and is available for public inspection.
    a. Type of Application: Original Major License.
    b. Project No.: 13526-001.
    c. Date Filed: February 8, 2010.
    d. Applicant: Bowersock Mills Power Company (Bowersock).
    e. Name of Project: Bowersock Mills and Power Company Expanded
Kansas River Hydropower Project.
    f. Location: The project would be located on the Kansas River in
Douglas County, Kansas. The project would not affect Federal lands.
    g. Filed Pursuant to: Federal Power Act, 16 U.S.C. 791(a)-825(r).
    h. Applicant Contact: Sarah Hill-Nelson, The Bowersock Mills and
Power Company, P.O. Box 66, Lawrence, Kansas 66044;<PHONE_NUMBER>.
    i. FERC Contact: Monte TerHaar,<PHONE_NUMBER>, or via e-mail at
<EMAIL_ADDRESS>    j. Cooperating agencies: Federal, State, local, and Tribal agencies
with jurisdiction and/or special expertise with respect to
environmental issues that wish to cooperate in the preparation of the
environmental document should follow the instructions for filing such
requests in item l below. Cooperating agencies should note the
Commission's policy that agencies that cooperate in the preparation of
the environmental document cannot also intervene. See 94 FERC ] 61,076
(2001).
    k. Pursuant to Section 4.32(b)(7) of 18 CFR of the Commission's
regulations, if any resource agency, Indian Tribe, or person believes
that an additional scientific study should be conducted in order to
form an adequate factual basis for a complete analysis of the
application on its merit, the resource agency, Indian Tribe, or person
must file a request for a study with the Commission not later than 60
days from the date of filing of the application, and serve a copy of
the request on the applicant.
    l. Deadline for filing requests for cooperating agency status and
additional studies: April 9, 2010.
    All documents may be filed electronically via the Internet. See 18
CFR 385.2001(a)(1)(iii) and the instructions on the Commission's Web
site (http://www.ferc.gov/docs-filing/ferconline.asp) under the ``e-
Filing'' link. For a simpler method of submitting text only comments,
click on ``Quick Comment''. For assistance, please contact FERC Online
Support at<EMAIL_ADDRESS>call toll-free at (866) 208-
3676; or, for TTY, contact<PHONE_NUMBER>. Although the Commission
strongly encourages electronic filing, documents may also be paper-
filed. To paper-file, mail an original and eight copies to: Kimberly D.
Bose, Secretary, Federal Energy Regulatory Commission, 888 First
Street, NE., Washington, DC 20426.
    m. This application is not ready for environmental analysis at this
time.
    n. Project Description: The existing Bowersock dam and powerhouse
currently operates under an exemption (Project No. 2644) as a small
hydropower project of 5 megawatts (MW) or less. The proposed project
would consist of the existing Bowersock dam and two powerhouses; the
existing powerhouse on the South bank of the Kansas River, and a
proposed powerhouse on the North bank of the Kansas River. The proposed
project would have a total capacity of 6.012 MW and generate an
estimated 33 gigawatt-hours annually. The electricity produced by the
project would be sold to a local utility.
    The proposed project would consist of the following:
    (1) The existing 665-foot-long, 17-foot-high timber-crib Bowersock
Dam; (2) a 120-foot-long gated spillway with seven gates; (3) raising
the existing flashboards from 4 feet high to 5.5 feet high; (4) an
existing 4.3-mile-long reservoir, having a normal water surface
elevation of 813.5 feet mean sea level; (5) an existing South
powerhouse, containing seven turbine/generator units having an
installed capacity of 2.012 MW; (6) a proposed North powerhouse with
four turbine/generator units, having an

installed capacity of 4.6 MW; (7) a proposed 20-foot-wide roller gate;
(8) a new intake flume with trashracks; (9) a new 150-foot-long
recreational boat portage located along the north bank of the Kansas
River; (10) a new 765-foot-long, 12-kilovolt (kV) transmission line
connecting to an existing 535-foot-long 2.3-kV transmission line; and
(8) appurtenant facilities.
    The project would be operated in a run-of-river mode, where water
levels in the reservoir would be maintained near the top of the flash
boards. To avoid potential flooding of upstream lands, the project
would incorporate a 20-foot-wide roller gate designed to release flows
up to 2,600 cfs. In addition, the flashboards would be designed to
collapse during periods of high inflows when the water surface
elevation rises 6 inches above the top of the flashboards.
    o. A copy of the application is available for review at the
Commission in the Public Reference Room or may be viewed on the
Commission's Web site at http://www.ferc.gov, using the ``eLibrary''
link. Enter the docket number excluding the last three digits in the
docket number field to access the document. For assistance, contact
FERC Online Support. A copy is also available for inspection and
reproduction at the address in item (h) above.
    You may also register online at http://www.ferc.gov/docs-filing/
esubscription.asp to be notified via e-mail of new filings and
issuances related to this or other pending projects. For assistance,
contact FERC Online Support.
    p. With this notice we intend to waive stage I and stage II pre-
filing consultation requirements. On October 6, 2009 Bowersock filed a
pre-application document and request for waiver of stage I and stage II
consultation. As required by sections 5.3(d)(2) of the Commission's
regulations, on September 24, 2009 Bowersock published notice in a
local paper (the Lawrence Daily Journal) of its request to waive
consultation which specified that comments should be filed with the
Commission. The application includes letters from the U.S. Fish and
Wildlife Service and the Kansas Department of Wildlife and Parks, both
indicating that there is sufficient information available to make a
recommendation for licensing the project and that no further studies
are necessary. Commission staff reviewed the application and comments
received and determined that Bowersock's application adequately
addresses the issues such that no additional agency consultation is
necessary.
    q. With this notice we intend to waive scoping. Based on a review
of the application filed by Bowersock, resource agency consultation
letters, and comments filed to date, Commission staff intends to
prepare a single environmental assessment (EA). The EA will assess the
potential effects of project construction and operation on geology and
soils, aquatic, terrestrial, threatened and endangered species,
recreation and land use, aesthetic, and cultural and historic
resources. Commission staff determined that the issues that need to be
addressed in its EA have been adequately identified during the pre-
filing period for the application, which includes a public meeting and
site visit conducted by Bowersock on August 13, 2009, and no new issues
are likely to be identified through additional scoping.
    r. Procedural Schedule: The application will be processed according
to the following Hydro Licensing Schedule. Revisions to the schedule
will be made as appropriate.

------------------------------------------------------------------------
              Milestone                           Target date
------------------------------------------------------------------------
Additional study requests and          April 9, 2010.
 cooperating agency request due.
Notice of Acceptance, Intervenors,     April 23, 2010.
 and Ready for Environmental Analysis
 issued.
Recommendations, preliminary terms &   June 22, 2010.
 conditions, and fishway
 prescriptions due.
Commission issues EA.................  August 20, 2010.
Comments on EA due...................  September 20, 2010.
------------------------------------------------------------------------

Kimberly D. Bose,
Secretary.
[FR Doc. 2010-5040 Filed 3-9-10; 8:45 am]
BILLING CODE 6717-01-P


Meeting the California LCFS'' August 22, 2011. E2/Environmental
Entrepreneurs.
---------------------------------------------------------------------------

    EPA has recently approved an advanced ethanol pathway that is
produced from grain sorghum at dry mill facilities using specified
forms of biogas for both process energy and most electricity
production.\32\ Although advanced sorghum ethanol is not reflected in
Table III.B.2-2, sorghum ethanol is likely to help meet the 2013
advanced biofuel volume requirements as a number of companies have been
making preparations to use this feedstock. We are also currently
investigating a variety of other potential RIN-generating pathways for
advanced biofuel that could result in additional volumes in 2013. In
addition to potential new pathways for cellulosic biofuel that would
also count as advanced biofuel as discussed in Section II.D, new
pathways for advanced biofuel could include certain butanol processes
from corn and certain ethanol processes from barley. We have not yet
determined, either through rulemaking or approval of an industry
petition, whether these pathways are valid for the generation for
advanced biofuel RINs. However, approval of such advanced biofuel
pathways could potentially result in 200 million additional ethanol-
equivalent gallons of advanced biofuel being qualified to participate
in the RFS program. Insofar as any of these pathways are approved in
time to be used in 2013, it would increase the volume of domestically-
produced advanced biofuels available for 2013 compliance.
---------------------------------------------------------------------------

    \32\ See 77 FR 74592 published on December 17, 2012.
---------------------------------------------------------------------------

3. Imported Sugarcane Ethanol
    EPA estimates that if biodiesel production in 2013 does not exceed
1.28 bill gallons, and domestic production of other advanced biofuels
is about 150 mill gallons, imports of sugarcane ethanol from Brazil
would need to reach 666 mill gal in order for the 2.75 bill gal
advanced biofuel requirement to be met. We believe that such volumes
can be reasonably expected from Brazil despite some uncertainty in
production and export potential.
    From the supply perspective, recent production of sugarcane in
Brazil has been lower than normally expected due to two factors. First,
adverse weather conditions have reduced production.\33\ Since the
adverse weather conditions are estimated to have reduced cane
production by about 4%, a return to normal weather conditions should
alone restore approximately 4% of production. Second, the general
economic downturn made credit harder to get, delaying the replanting of
existing fields. Normally sugarcane fields are replanted every five or
six years to maximize yield. However, the lack of available credit
caused some growers to delay the expense of this replanting, with the
older fields losing production.\34\
---------------------------------------------------------------------------

    \33\ Gain Report BR110016, October 3, 2011, USDA Agricultural
Service. See http://gain.fas.usda.gov/Recent%20GAIN%20Publications/Sugar%20Semi-annual_Sao%20Paulo%20ATO_Brazil_10-3-2011.pdf
    \34\ On the margin, the high sugar prices may have also
encouraged some growers to divert their crop from ethanol production
to sugar production. But most cane growers do not have this
flexibility with sugarcane mills designed for fixed amounts of
refined sugar or ethanol so high sugar prices was likely a
contributing factor but not a major cause of reduced sugarcane
ethanol production in Brazil.
---------------------------------------------------------------------------

    Early 2012/13 sugarcane crop year data suggests that, at the very
least, production in the 2012/2013 year will not be lower than in 2011/
2012. According to UNICA's December 1, 2012 biweekly report of sugar
and ethanol production, total ethanol production from the 2012/13 crop
in the South Central region was approximately 5.38 billion gallons, up
slightly from 5.36 billion gallons this time last year.\35\ In
September, UNICA projected that the South Central region, the dominant
region for ethanol production in Brazil, will produce a total of 5.56
billion gallons for the 2012/13 year.\36\ Other regions contributed
roughly another 565 million gallons in 2011/12. Based on this, 6.1
billion gallons is a reasonable conservative estimate for total 2012/13
production, assuming no growth at all in production outside the South
Central region. By comparison, total ethanol production from the 2011/
12 crop was just less than 6 billion gallons.
---------------------------------------------------------------------------

    \35\ UNICA, ``Harvest update: Biweekly Bulletin'', December 1,
2012, http://www.unicadata.com.br/listagem.php?idMn=63.
    \36\ UNICA, ``Estimate for 2012/2013 Sugarcane Harvest of
Brazilian South-Central Region'', September 20, 2012, http://www.unicadata.com.br/listagem.php?idMn=39.
---------------------------------------------------------------------------

    Some parties expect a more typical trend in sugarcane ethanol
production for 2013 and future years, with replanted fields beginning
to boost sugarcane production in existing plantations and, in response
to increased worldwide demand, a growth in the acres planted with
sugarcane. Increased production is supported by the Brazilian
government which announced in February 2012 support for a plan to
invest over $8 billion annually to boost cane and ethanol
production.\37\ Private investment in Brazil is also increasing. For
example, Usina de Acucar Santa Terezinha, a Brazilian ethanol producer,
recently announced plans to invest almost $300 million in a new mill
and sugarcane plantation.\38\ All of this suggests that sugarcane and
ethanol production in the 2013/14 harvest year (which will begin in
April of 2013) will be significantly higher than production over the
last two years.
---------------------------------------------------------------------------

    \37\ See http://www.platts.com/RSSFeedDetailedNews/RSSFeed/Oil/8987702.
    \38\ See http://www.bloomberg.com/news/2012-03-08/santa-terezinha-invests-283-million-in-brazil-ethanol-projects.html.

---------------------------------------------------------------------------

    Nevertheless, there remains some uncertainty in the volumes of
sugarcane ethanol that could be produced in Brazil in 2013. If weather
conditions are unfavorable for another year, ethanol production may not
recover from the comparatively low levels in 2011 and early 2012. A
study from USDA projects that this may be the case, and concludes that
total ethanol exports from Brazil to all countries in 2013 may only
reach about 500 mill gallons,\39\ well short of the 666 mill gal that
would be needed as described above. As a result, it is possible that
there could be a shortfall of the total advanced biofuel requirement in
2013 under these circumstances.
---------------------------------------------------------------------------

    \39\ USDA Foreign Agricultural Service, ``Brazil Biofuels
Annual, Annual Report 2012,'' August 21, 2012. GAIN Report Number
BR12013.
---------------------------------------------------------------------------

    Brazil's sugarcane ethanol production serves both its domestic
market as well as the export market. The government of Brazil sets a
minimum ethanol concentration for its gasoline. In 2011, the Brazilian
government lowered this concentration to 20%, reflecting the decrease
in domestic production. There have been indications that Brazil may
raise the minimum ethanol concentration back up by 25% by May of
2013,\40\ but no formal announcement has been made. Projecting this
Brazilian domestic demand into the future can be uncertain since the
government can reset the minimum ethanol content at any time; in the
past this adjustment has largely been influenced by the price of
ethanol (high prices leading to a reduction in the minimum percent).
While these historical changes have typically varied by a few percent
and have only occurred periodically, they do add another element of
uncertainty to any projection of the volumes of ethanol that may be
available for export to the U.S. in 2013.
---------------------------------------------------------------------------

    \40\ Bloomberg, ``Brazil Said to Plan Higher Ethanol Blend as
Early as May,'' December 18, 2012. http://www.bloomberg.com/news/2012-12-18/brazil-said-to-plan-higher-ethanol-blend-as-early-as-may.html
---------------------------------------------------------------------------

    Total exports of ethanol from Brazil depend on ethanol production
and demand within Brazil, and have varied significantly over the last
decade. The historical maximum occurred in 2008 when 1.35 bill gal was
exported, and ongoing efforts to upgrade distribution infrastructure
mean that Brazil is capable of exporting around 2 bill gal today.
However, actual export volumes in 2010-2012 have been significantly
below those from previous years. Moreover, imports of ethanol into
Brazil also impact the volumes it exports. In both 2011 and 2012 there
was significant two-way trade in ethanol between the United States and
Brazil. According to current EIA data, in 2011 the U.S. imported 101
million gallons of sugarcane ethanol from Brazil and exported 396
million gallons of corn-based ethanol to Brazil. Total fuel ethanol
exports in 2011 were 1.2 billion gallons, and total exports through
October 2012 were 646 million gallons. This two-way trade of ethanol
engenders additional transport related emissions.
[GRAPHIC] [TIFF OMITTED] TP07FE13.010

    Aside from production capability and domestic demand within Brazil,
market conditions generally determine the availability of sugarcane
ethanol imported into the U.S. from Brazil. Approved as an advanced
biofuel pathway, ethanol produced from sugarcane benefits from the RIN
value associated with advanced biofuel but also has to compete with
other sources of ethanol used for blending with gasoline in the U.S.,
most notably ethanol made from corn starch (which does not qualify as
an advanced biofuel). The expiration of the tariff

applicable to imported ethanol has helped make imported sugarcane
ethanol more cost competitive in the U.S., and any volumes of Brazilian
sugarcane ethanol imported into California to meet the requirements of
their Low Carbon Fuel Standard (LCFS) would also count towards meeting
the requirements of the RFS program. However, international demand for
Brazilian sugarcane ethanol is expected to continue to create some
limitations in what volumes may be available to the U.S. Indeed in 2010
essentially all ethanol exported from Brazil went to other countries,
and in 2011 about 70% of ethanol exported from Brazil went to other
countries. As a result, imports of Brazilian sugarcane ethanol into the
U.S. in 2010 and 2011 were comparatively low. Brazil is on track to
meet the need for about 500 mill gal of imported sugarcane ethanol in
the U.S. in 2012, but this is below the 666 mill gal that may be needed
in 2013 to meet the 2.75 bill gal advanced biofuel requirement.
However, since the rate of ethanol imports from Brazil was
significantly higher in recent months than at the beginning of 2012,
there may be good reason to expect that import volumes in 2013 will be
higher than in 2012.
[GRAPHIC] [TIFF OMITTED] TP07FE13.011

    Considering that reinvestment in sugarcane stock is already
underway, a considerable resurgence in Brazilian ethanol export
potential in the 2013 calendar year seems likely. Any limitations on
ethanol exports created by delayed reinvestment in sugarcane stock
appear to be waning. While uncertainties exist, on balance there is
good reason to believe that Brazil can export at least 666 mill gal of
ethanol to the U.S. in 2013.

C. Proposed Volume Requirements for Advanced Biofuel and Total
Renewable Fuel in 2013

    As shown in Table III.B-2, in order for an advanced biofuel
requirement of 2.75 bill gal to be met, there would need to be 816 mill
gal of advanced biofuels in addition to the volumes that would need to
be produced to meet the biomass-based diesel and proposed cellulosic
biofuel requirements. After reviewing the projected availability of
advanced biofuel volumes from various sources, we have preliminarily
determined that it is likely that there will be sufficient volumes
available to produce or import this 816 mill gal. Given our estimate of
about 150 mill gal of domestic ``other'' advanced biofuel, the
remaining volume of 666 mill gal would likely need to come from
imported sugarcane ethanol and/or biodiesel in excess of 1.28 bill gal.
As discussed above, we believe that this volume is achievable through a
combination of these sources. Therefore, we believe that there is no
reason to reduce the required volume of 2.75 bill gal advanced biofuel
on the basis of available volumes. As noted above, maintaining the 2.75
bill gal advanced biofuel volume set forth in the statute will result
in reduced GHG emissions from the transportation sector and could also
contribute to energy security objectives. We do not believe it is
appropriate to forgo such benefits when they are physically achievable
but we invite comment on this issue, particularly in the context of
increasing international trade in biofuels and the blendwall
implications for ethanol consumption (see discussion in Section D
below).
    Nevertheless, we recognize that some uncertainty exists in the
projected availability of other advanced biofuels. The single largest
source, Brazilian sugarcane ethanol, was exported at lower total
volumes in 2010-2012 than the U.S. would need in 2013 to meet the 2.75
bill gal advanced biofuel requirement. Moreover, the need for 666 mill
gal of Brazilian sugar ethanol in

2013 exceeds all historical volumes of ethanol imported into the U.S.
from Brazil by a substantial margin. In addition, some stakeholders
have stated that given a limited supply, sugarcane ethanol imported
into the U.S. may be replaced in the exporting country's domestic
market by either non-advanced biofuels, or by petroleum, which these
stakeholders believe could lead to adverse GHG impacts. There may be
enough uncertainty to warrant a more cautious approach to advanced
biofuel and total renewable fuel in 2013, for example a reduction of
200 mill gal to approximate the uncertainty discussed above. Therefore,
while we are not proposing to reduce the required volumes of advanced
biofuel and total renewable fuel for 2013, we request comment on
whether and to what extent a reduction is warranted; we have the
discretion to reduce the advanced biofuel volume requirement for 2013
by up to the amount that the cellulosic biofuel volume requirement is
reduced (986 mill gal in today's proposal). Were we to do so, as
discussed in Section III.A, we would also simultaneously reduce the
total renewable fuel requirement by the same amount.
    The overall cost impact of reducing the advanced biofuel and total
renewable fuel volume mandates would depend on a number of factors,
such as the future cost of petroleum, 2012/2013 crop production, the
number of additional advanced biofuel pathways that are approved over
the next year, and the time it would take for facilities using new
advanced pathways to begin generating RINs.
    In 2014, the advanced biofuel requirement rises substantially to
3.75 bill gal. Thus regardless of whether we reduce the advanced
biofuel and total renewable fuel volume requirements for 2013, we also
seek comment on whether such a reduction should be considered for 2014,
the basis for such a reduction, and the amount of that reduction.

D. Consideration of the Ethanol Blendwall

    As the volume requirements of the RFS program increase, it becomes
more likely that the volume of ethanol that must be consumed to meet
those requirements will exceed the volume that can be consumed as E10.
Additional volumes of ethanol must then be consumed as higher blend
levels such as E15 or E85. While other non-ethanol biofuels can also be
used to meet the RFS requirements, ethanol has predominated and will
likely continue to predominate in the near future. As a result, some
stakeholders have indicated that the volume of ethanol that can be
legally and practically consumed in 2013 is a limiting factor in how
much renewable biofuel can be consumed.
    In the context of the analyses conducted to support the decision
regarding requests for a waiver of the renewable fuel standard, we
estimated that the number of excess RINs generated in 2012 that could
be carried over to 2013 will be on the order of 2.6 billion.\41\ Since
this number of carryover RINs falls below the rollover cap imposed by
Sec.  80.1427(a)(5), all of them can be used for compliance purposes in
2013. As a result, we expect that the RFS demand for physical gallons
of ethanol will be significantly less than the E10 saturation point
(the blendwall), and thus there would be no dependence on significant
volumes of E15-E85 in 2013. This remains the case regardless of whether
EPA were to reduce the advanced biofuel and total renewable fuel volume
requirements as described in Section III.C above. Nevertheless, we
request comment on whether the blendwall presents any difficulty in
terms of compliance with the RFS volume requirements in 2013.
---------------------------------------------------------------------------

    \41\ 77 FR 70759, November 27, 2012.
---------------------------------------------------------------------------

    In 2014, the situation could be different. There are a number of
factors that will play a role in determining how regulated parties will
demonstrate compliance with the applicable RFS volumes. First, the
advanced biofuel and total renewable fuel requirements rise
substantially to 3.75 bill gal and 18.15 bill gal respectively. This
increase in volume, combined with the corn-ethanol volume expected to
meet the total renewable fuel standard, could cause the total ethanol
volume used to comply with the RFS program to be higher than 16 bill
gal. While non-ethanol biofuels are also anticipated to continue to
grow to help supply the advanced biofuel standard, this value gives
some estimate of the amount of ethanol that might need to be used to
comply with the RFS program in 2014. Second, the number of carryover
RINs will also be a critical factor in determining whether obligated
parties can acquire sufficient RINs to show compliance with the RFS
volume requirements. However, the number of carryover RINs into 2014
will almost certainly be lower than for 2013. EPA will continue to
engage with stakeholders on this issue as we project the RFS volume
requirements for 2014.

IV. Proposed Percentage Standards for 2013

A. Background

    The renewable fuel standards are expressed as volume percentages
and are used by each refiner, blender, or importer to determine their
renewable volume obligations (RVO). Since there are four separate
standards under the RFS2 program, there are likewise four separate RVOs
applicable to each obligated party. Each standard applies to the sum of
all gasoline and diesel produced or imported. The applicable percentage
standards are set so that if every obligated party meets the
percentages, then the amount of renewable fuel, cellulosic biofuel,
biomass-based diesel, and advanced biofuel used will meet the volumes
required on a nationwide basis.
    As discussed in Section II.D, we are proposing a required volume of
cellulosic biofuel for 2013 of 11 million gallons (14 million ethanol-
equivalent gallons). The volume we select for the final rule will be
used as the basis for setting the percentage standard for cellulosic
biofuel for 2013. We are also proposing that the advanced biofuel and
total renewable fuel volumes would not be reduced below the applicable
volumes specified in the statute. The biomass-based diesel volume for
2013 has been established at 1.28 billion gallons through a separate
rulemaking. The volumes used to determine the four proposed percentage
standards are shown in Table IV.A-1.

    Table IV.A-1--Proposed Volumes for Use in Setting the Applicable
                     Percentage Standards for 2013 a
------------------------------------------------------------------------

------------------------------------------------------------------------
Cellulosic biofuel......................  14 mill gal.
Biomass-based diesel....................  1.28 bill gal.
Advanced biofuel........................  2.75 bill gal.
Renewable fuel..........................  16.55 bill gal.
------------------------------------------------------------------------
\a\ Due to the manner in which the percentage standards are calculated,
  all volumes are given in terms of ethanol-equivalent except for
  biomass-based diesel which is given in terms of physical volume.

    As with previous years' renewable fuels standards determination,
the formulas used in deriving the annual standards are based in part on
estimates of the volumes of gasoline and diesel fuel, for both highway
and nonroad uses, that are projected to be used in the year in which
the standards will apply. Producers of other transportation fuels, such
as natural gas, propane, and electricity from fossil fuels, are not
subject to the standards, and volumes of such fuels are not used in
calculating the annual standards. Since the

standards apply to producers and importers of gasoline and diesel,
these are the transportation fuels used to set the standards, and then
again to determine the annual volume obligations of an individual
gasoline or diesel producer or importer.

B. Calculation of Standards

1. How are the standards calculated?
    The following formulas are used to calculate the four percentage
standards applicable to producers and importers of gasoline and diesel
(see Sec.  80.1405):
[GRAPHIC] [TIFF OMITTED] TP07FE13.012

Where:

StdCB,i = The cellulosic biofuel standard for year i, in
percent.
StdBBD,i = The biomass-based diesel standard (ethanol-
equivalent basis) for year i, in percent.
StdAB,i = The advanced biofuel standard for year i, in
percent.
StdRF,i = The renewable fuel standard for year i, in
percent.
RFVCB,i = Annual volume of cellulosic biofuel required by
section 211(o) of the Clean Air Act for year i, in gallons.
RFVBBD,i = Annual volume of biomass-based diesel required
by section 211(o) of the Clean Air Act for year i, in gallons.
RFVAB,i = Annual volume of advanced biofuel required by
section 211(o) of the Clean Air Act for year i, in gallons.
RFVRF,i = Annual volume of renewable fuel required by
section 211(o) of the Clean Air Act for year i, in gallons.
Gi = Amount of gasoline projected to be used in the 48
contiguous states and Hawaii, in year i, in gallons.
Di = Amount of diesel projected to be used in the 48
contiguous states and Hawaii, in year i, in gallons.
RGi = Amount of renewable fuel blended into gasoline that
is projected to be consumed in the 48 contiguous states and Hawaii,
in year i, in gallons.
RDi = Amount of renewable fuel blended into diesel that
is projected to be consumed in the 48 contiguous states and Hawaii,
in year i, in gallons.
GSi = Amount of gasoline projected to be used in Alaska
or a U.S. territory in year i if the state or territory opts-in, in
gallons.
RGSi = Amount of renewable fuel blended into gasoline
that is projected to be consumed in Alaska or a U.S. territory in
year i if the state or territory opts-in, in gallons.
DSi = Amount of diesel projected to be used in Alaska or
a U.S. territory in year i if the state or territory opts-in, in
gallons.
RDSi = Amount of renewable fuel blended into diesel that
is projected to be consumed in Alaska or a U.S. territory in year i
if the state or territory opts-in, in gallons.
GEi = Amount of gasoline projected to be produced by
exempt small refineries and small refiners in year i, in gallons, in
any year they are exempt per Sec. Sec.  80.1441 and 80.1442,
respectively. For 2013, this value is zero. See further discussion
in Section IV.B.2 below.
DEi = Amount of diesel projected to be produced by exempt
small refineries and small refiners in year i, in gallons, in any
year they are exempt per Sec. Sec.  80.1441 and 80.1442,
respectively. For 2013, this value is zero. See further discussion
in Section IV.B.2 below.

    The Act requires EPA to base the standards on an EIA estimate of
the amount of gasoline and diesel that will be sold or introduced into
commerce for that year. The four separate renewable fuel standards for
2013 are based on the gasoline, ethanol, diesel, and biodiesel
consumption volumes projected by EIA.\42\ We adjusted these nationwide
values to represent the 49 states that participate in the RFS program
(neither Alaska nor any U.S. territory participates).
---------------------------------------------------------------------------

    \42\ Letter, Adam Sieminski, Administrator, U.S. Energy
Information Administration, to Lisa P. Jackson, Administrator, U.S.
EPA, October 18, 2012.
---------------------------------------------------------------------------

2. Small Refineries and Small Refiners
    In CAA section 211(o)(9), enacted as part of the Energy Policy Act
of 2005, Congress provided a temporary exemption to small refineries
(those refineries with a crude throughput of no more than 75,000
barrels of crude per day) through December 31, 2010. In our initial
rulemaking to implement the new RFS program \43\, we exercised our
discretion under section 211(o)(3)(B) and extended this temporary
exemption to the few remaining small refiners that met the Small
Business Administration's (SBA) definition of a small business (1,500
employees or less company-wide) but did not meet the statutory small
refinery definition as

noted above. 40 CFR 80.1141, 80.1142. Because EISA did not alter the
small refinery exemption in any way, the RFS2 program regulations
maintained the exemptions for gasoline and diesel produced by small
refineries and small refiners through 2010 (unless the exemption was
waived). See 40 CFR 80.1441, 80.1442.
---------------------------------------------------------------------------

    \43\ 72 FR 23900, May 1, 2007.
---------------------------------------------------------------------------

    Congress provided two ways that small refineries can receive a
temporary extension of the exemption beyond 2010. One is based on the
results of a study conducted by the Department of Energy (DOE) to
determine whether small refineries would face a disproportionate
economic hardship under the RFS program. The other is based on EPA
determination of disproportionate economic hardship on a case-by-case
basis in response to refiner petitions.
    In January 2009, DOE issued a study which did not find that small
refineries would face a disproportionate economic hardship under the
RFS program.\44\ The conclusions were based in part on the expected
robust availability of RINs and EPA's ability to grant relief on a
case-by-case basis. As a result, beginning in 2011 small refiners and
small refineries were required to participate in the RFS program as
obligated parties, and there was no small refiner/refinery volume
adjustment to the 2011 standards as there was for the 2010 standards.
---------------------------------------------------------------------------

    \44\ DOE report ``EPACT 2005 Section 1501 Small Refineries
Exemption Study'', (January, 2009).
---------------------------------------------------------------------------

    Following the release of DOE's 2009 small refinery study, Congress
directed DOE to complete a reassessment and issue a revised report. In
March of 2011 DOE re-evaluated the impacts of the RFS program on small
entities and concluded that some small refineries would suffer a
disproportionate hardship.\45\ As a result, EPA exempted these
refineries from being obligated parties for two additional years, 2011
and 2012.\46\ The 2012 standards established in the January 9, 2012,
final rulemaking reflected the exemption of these refineries. We are
seeking comment on whether it would be appropriate to extend the two
year exemption for small refineries as discussed in section
211(o)(9)(A)(ii)(II).
---------------------------------------------------------------------------

    \45\ ``Small Refinery Exemption Study: An Investigation into
Disproportionate Economic Hardship,'' U.S. Department of Energy,
March 2011.
    \46\ Since the standards are applied on an annual basis, the
exemptions are likewise on an annual basis even though the
determination of which refineries would receive an extension to
their exemption did not occur until after January 1, 2011.
---------------------------------------------------------------------------

    EPA may also extend the exemption for individual small refineries
or small refiners on a case-by-case basis if they demonstrate
disproportionate economic hardship. 40 CFR Sec. Sec.  80.1441(e)(2),
80.1442(h). EPA has granted some exemptions pursuant to this process
that apply in 2011 and 2012. However, at this time, no exemptions have
been approved for 2013. Therefore, for this proposal we have calculated
the proposed 2013 standards without a small refinery/small refiner
adjustment.
    Note that if exemptions under Section 211(o)(9)(A)(ii)(II) were
granted before finalizing the standards, or if an individual small
refinery or small refiner requests an exemption and is approved
following the release of this NPRM and prior to issuance of the final
rule, the final standards will be adjusted upward to account for the
exempted volumes of gasoline and diesel. Any requests for exemptions
that are approved after the release of the final 2013 RFS standards
will not affect the 2013 standards. As stated in the final rule
establishing the 2011 standards, ``EPA believes the Act is best
interpreted to require issuance of a single annual standard in November
that is applicable in the following calendar year, thereby providing
advance notice and certainty to obligated parties regarding their
regulatory requirements. Periodic revisions to the standards to reflect
waivers issued to small refineries or refiners would be inconsistent
with the statutory text, and would introduce an undesirable level of
uncertainty for obligated parties.'' Thus, after the 2013 standards are
finalized, any additional exemptions for small refineries or small
refiners that are issued will not affect those 2013 standards. EPA
requests comment on whether it is appropriate for the agency to make
changes to the 2013 volumes if small refiner exemptions are granted
after the final rule is issued.
    We encourage any producers of gasoline and/or diesel who believe
that they may be eligible under the small refinery or small refiner
exemption provision to send a petition to the EPA under the provisions
of Sec.  80.1441 or Sec.  80.1442. We believe that the approach EPA is
currently using to assess disproportionate economic hardships for small
refineries and small refiners appropriately addresses the intent of the
statutory provision and the needs of the affected parties.
3. Proposed Standards
    As specified in the March 26, 2010 RFS2 final rule \47\, the
percentage standards are based on energy-equivalent gallons of
renewable fuel, with the cellulosic biofuel, advanced biofuel, and
total renewable fuel standards based on ethanol equivalence and the
biomass-based diesel standard based on biodiesel equivalence. However,
all RIN generation is based on ethanol-equivalence. More specifically,
the RFS2 regulations provide that production or import of a gallon of
qualifying biodiesel will lead to the generation of 1.5 RINs. In order
to ensure that demand for 1.28 billion physical gallons of biomass-
based diesel will be created in 2013, the calculation of the biomass-
based diesel standard provides that the required volume be multiplied
by 1.5. The net result is a biomass-based diesel gallon being worth 1.0
gallon toward the biomass-based diesel standard, but worth 1.5 gallons
toward the other standards.
---------------------------------------------------------------------------

    \47\ 75 FR 14670, March 26, 2010.
---------------------------------------------------------------------------

    The levels of the percentage standards would be reduced if Alaska
or a U.S. territory chooses to participate in the RFS2 program, as
gasoline and diesel produced in or imported into that state or
territory would then be subject to the standard. Neither Alaska nor any
U.S. territory has chosen to participate in the RFS2 program at this
time, and thus the value of the related terms in the calculation of the
standards is zero.
    Note that because the gasoline and diesel volumes estimated by EIA
include renewable fuel use, we must subtract the total renewable fuel
volumes from the total gasoline and diesel volumes to get total non-
renewable gasoline and diesel volumes. The values of the variables
described above are shown in Table IV.B.3-1.\48\ Terms not included in
this table have a value of zero.
---------------------------------------------------------------------------

    \48\ To determine the 49-state values for gasoline and diesel,
the amounts of these fuels used in Alaska is subtracted from the
totals provided by DOE. The Alaska fractions are determined from the
most recent (2010) EIA State Energy Data, Transportation Sector
Energy Consumption Estimates. The gasoline and transportation
distillate fuel oil fractions are approximately 0.2% and 0.7%,
respectively. Ethanol use in Alaska is estimated at 11.2% of its
gasoline consumption (based on the same State data), and biodiesel
use is assumed to be zero.

    Table IV.B.3-1--Values for Terms in Calculation of the Standards
                               [Bill gal]
------------------------------------------------------------------------
                           Term                                Value
------------------------------------------------------------------------
RFVCB,2013...............................................          0.014
RFVBBD,2013..............................................          1.28
RFVAB,2013...............................................          2.75
RFVRF,2013...............................................         16.55
G2013....................................................        133.70
D2013....................................................         52.26
RG2013...................................................         12.85
RD2013...................................................          1.23
------------------------------------------------------------------------

    Using the volumes shown in Table IV.B.3-1, we have calculated the
proposed percentage standards for 2013 as shown in Table IV.B.3-2.

         Table IV.B.3-2--Proposed Percentage Standards for 2013
------------------------------------------------------------------------

------------------------------------------------------------------------
Cellulosic biofuel.......................................        0.008%
Biomass-based diesel.....................................        1.12%
Advanced biofuel.........................................        1.60%
Renewable fuel...........................................        9.63%
------------------------------------------------------------------------

V. Public Participation

    We request comment on all aspects of this proposal. This section
describes how you can participate in this process.

A. How do I submit comments?

    We are opening a formal comment period by publishing this document.
We will accept comments during the period indicated under the DATES
section above. If you have an interest in the proposed standards, we
encourage you to comment on any aspect of this rulemaking. We also
request comment on specific topics identified throughout this proposal.
    Your comments will be most useful if you include appropriate and
detailed supporting rationale, data, and analysis. Commenters are
especially encouraged to provide specific suggestions for any changes
that they believe need to be made. You should send all comments, except
those containing proprietary information, to our Air Docket (see
ADDRESSES section above) by the end of the comment period.
    You may submit comments electronically, by mail, or through hand
delivery/courier. To ensure proper receipt by EPA, identify the
appropriate docket identification number in the subject line on the
first page of your comment. Please ensure that your comments are
submitted within the specified comment period. Comments received after
the close of the comment period will be marked ``late.'' EPA is not
required to consider these late comments. If you wish to submit
Confidential Business Information (CBI) or information that is
otherwise protected by statute, please follow the instructions in
Section VI.B below.

B. How should I submit CBI to the agency?

    Do not submit information that you consider to be CBI
electronically through the electronic public docket,
www.regulations.gov, or by email. Send or deliver information
identified as CBI only to the following address: U.S. Environmental
Protection Agency, Assessment and Standards Division, 2000 Traverwood
Drive, Ann Arbor, MI 48105, Attention Docket ID EPA-HQ-OAR-2012-0546.
You may claim information that you submit to EPA as CBI by marking any
part or all of that information as CBI (if you submit CBI on disk or CD
ROM, mark the outside of the disk or CD ROM as CBI and then identify
electronically within the disk or CD ROM the specific information that
is CBI). Information so marked will not be disclosed except in
accordance with procedures set forth in 40 CFR part 2.
    In addition to one complete version of the comments that include
any information claimed as CBI, a copy of the comments that does not
contain the information claimed as CBI must be submitted for inclusion
in the public docket. If you submit the copy that does not contain CBI
on disk or CD ROM, mark the outside of the disk or CD ROM clearly that
it does not contain CBI. Information not marked as CBI will be included
in the public docket without prior notice. If you have any questions
about CBI or the procedures for claiming CBI, please consult the person
identified in the FOR FURTHER INFORMATION CONTACT section.

VI. Statutory and Executive Order Reviews

A. Executive Order 12866: Regulatory Planning and Review and Executive
Order 13563: Improving Regulation and Regulatory Review

    Under Executive Order 12866 (58 FR 51735, October 4, 1993), this
action is a ``significant regulatory action'' because it raises novel
legal or policy issues arising out of legal mandates, the President's
priorities, or the principles set forth in the Executive Order.
Accordingly, EPA submitted this action to the Office of Management and
Budget (OMB) for review under Executive Orders 12866 and 13563 (76 FR
3821, January 21, 2011) and any changes made in response to OMB
recommendations have been documented in the docket for this action.
    The economic impacts of the RFS2 program on regulated parties,
including the impacts of the required volumes of renewable fuel, were
already addressed in the RFS2 final rule promulgated on March 26, 2010
(75 FR 14670). With the exception of cellulosic biofuel, this action
proposes the percentage standards applicable in 2013 based on the
volumes that were analyzed in the RFS2 final rule.

B. Paperwork Reduction Act

    This action does not impose an information collection burden under
the provisions of the Paperwork Reduction Act, 44 U.S.C. 3501 et seq.
Burden is defined at 5 CFR 1320.3(b). This proposed rule does not
impose any additional reporting requirements on regulated parties
beyond those already required under the RFS program; therefore, there
will not be any additional reporting burdens on entities impacted by
this regulation. This action merely proposes, as required by section
211(o) of the Clean Air Act, the RFS annual standards for 2013.

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) generally requires an agency
to prepare a regulatory flexibility analysis of any rule subject to
notice and comment rulemaking requirements under the Administrative
Procedure Act or any other statute unless the agency certifies that the
rule will not have a significant economic impact on a substantial
number of small entities. Small entities include small businesses,
small organizations, and small governmental jurisdictions.
    For purposes of assessing the impacts of today's rule on small
entities, small entity is defined as: (1) A small business as defined
by the Small Business Administration's (SBA) regulations at 13 CFR
121.201; (2) a small governmental jurisdiction that is a government of
a city, county, town, school district or special district with a
population of less than 50,000; and (3) a small organization that is
any not-for-profit enterprise which is independently owned and operated
and is not dominant in its field.
    After considering the economic impacts of today's proposed rule on
small entities, we certify that this proposed action will not have a
significant economic impact on a substantial number of small entities.
This rule proposes the annual standard for cellulosic biofuel for 2013
at 14 mill gal. Since small refiners and small refineries collectively
comprise about 11.9% of gasoline and 15.2% of diesel production\49\,
for an average of 12.9% for the entire gasoline + diesel pool, small
refiners and small refineries would only be required to collectively
meet a cellulosic biofuel requirement of about 1.8 mill gal (14 x
12.9%). At a projected cellulosic biofuel waiver credit price of $0.42,
the cost of complying with this requirement would total about $0.76
million for the approximately 60 obligated parties that would be
affected, or about $12,600 per facility on average.
---------------------------------------------------------------------------

    \49\ Estimates from RFS2 final rule, 75 FR 14867.
---------------------------------------------------------------------------

    The impacts of the RFS2 program on small entities were already
addressed in the RFS2 final rule promulgated on

March 26, 2010 (75 FR 14670), and this proposed rule will not impose
any additional requirements on small entities. However, we continue to
be interested in the potential impacts of the proposed rule on small
entities and welcome comments on issues related to such impacts.

D. Unfunded Mandates Reform Act

    This proposed action contains no Federal mandates under the
provisions of Title II of the Unfunded Mandates Reform Act of 1995
(UMRA), 2 U.S.C. 1531-1538 for State, local, or tribal governments or
the private sector. This action implements mandate(s) specifically and
explicitly set forth by the Congress in Clean Air Act section 211(o)
without the exercise of any policy discretion by EPA. Therefore, this
action is not subject to the requirements of sections 202 or 205 of the
UMRA.
    This action is also not subject to the requirements of section 203
of UMRA because it contains no regulatory requirements that might
significantly or uniquely affect small governments. This proposed rule
only applies to gasoline, diesel, and renewable fuel producers,
importers, distributors and marketers and merely proposes the 2013
annual standards for the RFS program.

E. Executive Order 13132: Federalism

    This action does not have federalism implications. It will not have
substantial direct effects on the States, on the relationship between
the national government and the States, or on the distribution of power
and responsibilities among the various levels of government, as
specified in Executive Order 13132. This action proposes the 2013
annual standards for the RFS program and only applies to gasoline,
diesel, and renewable fuel producers, importers, distributors and
marketers. Thus, Executive Order 13132 does not apply to this rule.
    In the spirit of Executive Order 13132, and consistent with EPA
policy to promote communications between EPA and State and local
governments, EPA specifically solicits comment on this proposed rule
from State and local officials.

F. Executive Order 13175: Consultation and Coordination With Indian
Tribal Governments

    This action does not have tribal implications, as specified in
Executive Order 13175 (65 FR 67249, November 9, 2000). This proposed
rule will be implemented at the Federal level and affects
transportation fuel refiners, blenders, marketers, distributors,
importers, exporters, and renewable fuel producers and importers.
Tribal governments would be affected only to the extent they purchase
and use regulated fuels. Thus, Executive Order 13175 does not apply to
this action.
    EPA specifically solicits additional comment on this proposed
action from tribal officials.

G. Executive Order 13045: Protection of Children From Environmental
Health Risks and Safety Risks

    EPA interprets EO 13045 (62 FR 19885, April 23, 1997) as applying
only to those regulatory actions that concern health or safety risks,
such that the analysis required under section 5-501 of the EO has the
potential to influence the regulation. This action is not subject to EO
13045 because it does not establish an environmental standard intended
to mitigate health or safety risks and because it implements specific
standards established by Congress in statutes (section 211(o) of the
Clean Air Act).

H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use

    This action is not a ``significant energy action'' as defined in
Executive Order 13211, ``Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use'' (66 FR 28355
(May 22, 2001)) because it is not likely to have a significant adverse
effect on the supply, distribution, or use of energy. This action
simply proposes the annual standards for renewable fuel under the RFS
program for 2013.

I. National Technology Transfer and Advancement Act

    Section 12(d) of the National Technology Transfer and Advancement
Act of 1995 (``NTTAA''), Public Law 104-113, 12(d) (15 U.S.C. 272 note)
directs EPA to use voluntary consensus standards in its regulatory
activities unless to do so would be inconsistent with applicable law or
otherwise impractical. Voluntary consensus standards are technical
standards (e.g., materials specifications, test methods, sampling
procedures, and business practices) that are developed or adopted by
voluntary consensus standards bodies. NTTAA directs EPA to provide
Congress, through OMB, explanations when the Agency decides not to use
available and applicable voluntary consensus standards.
    This proposed rulemaking does not involve technical standards.
Therefore, EPA is not considering the use of any voluntary consensus
standards.

J. Executive Order 12898: Federal Actions To Address Environmental
Justice in Minority Populations and Low-Income Populations

    Executive Order (EO) 12898 (59 FR 7629 (Feb. 16, 1994)) establishes
federal executive policy on environmental justice. Its main provision
directs federal agencies, to the greatest extent practicable and
permitted by law, to make environmental justice part of their mission
by identifying and addressing, as appropriate, disproportionately high
and adverse human health or environmental effects of their programs,
policies, and activities on minority populations and low-income
populations in the United States.
    EPA has determined that this proposed rule will not have
disproportionately high and adverse human health or environmental
effects on minority or low-income populations because it does not
affect the level of protection provided to human health or the
environment. This action does not relax the control measures on sources
regulated by the RFS regulations and therefore will not cause emissions
increases from these sources.

VII. Statutory Authority

    Statutory authority for this action comes from section 211 of the
Clean Air Act, 42 U.S.C. 7545. Additional support for the procedural
and compliance related aspects of today's proposal, come from Sections
114, 208, and 301(a) of the Clean Air Act, 42 U.S.C. 7414, 7542, and
7601(a).

List of Subjects in 40 CFR Part 80

    Administrative practice and procedure, Air pollution control,
Diesel fuel, Environmental protection, Fuel additives, Gasoline,
Imports, Oil imports, Petroleum.

    Dated: January 31, 2013.
Lisa P. Jackson,
Administrator.

    For the reasons set forth in the preamble, Environmental Protection
Agency proposes to amend 40 CFR part 80 as follows:

PART 80--REGULATION OF FUELS AND FUEL ADDITIVES

0
1. The authority citation for part 80 continues to read as follows:

    Authority: 42 U.S.C. 7414, 7521(1), 7545 and 7601(a).

0
2. Section 80.1405 is amended by adding paragraph (a)(4) to read as
follows:

Sec.  80.1405  What are the Renewable Fuel Standards?

    (a) * * *
    (4) Renewable Fuel Standards for 2013.
    (i) The value of the cellulosic biofuel standard for 2013 shall be
0.008 percent.
    (ii) The value of the biomass-based diesel standard for 2013 shall
be 1.12 percent.
    (iii) The value of the advanced biofuel standard for 2013 shall be
1.60 percent.
    (iv) The value of the renewable fuel standard for 2013 shall be
9.63 percent.
* * * * *
[FR Doc. 2013-02794 Filed 2-6-13; 8:45 am]
BILLING CODE 6560-50-P