[Federal Register: November 4, 2010 (Volume 75, Number 213)]
[Proposed Rules]
[Page 68043-68091]
[DOCID:fr04no10-7]

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Part II

Environmental Protection Agency

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40 CFR Part 80

Regulation To Mitigate the Misfueling of Vehicles and Engines With
Gasoline Containing Greater Than Ten Volume Percent Ethanol and
Modifications to the Reformulated and Conventional Gasoline Programs;
Proposed Rule

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ENVIRONMENTAL PROTECTION AGENCY

40 CFR Part 80

[EPA-HQ-OAR-2010-0448; FRL-9215-4]
RIN 2060-AQ17

Regulation To Mitigate the Misfueling of Vehicles and Engines
With Gasoline Containing Greater Than Ten Volume Percent Ethanol and
Modifications to the Reformulated and Conventional Gasoline Programs

AGENCY: Environmental Protection Agency (EPA).

ACTION: Proposed rule.

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SUMMARY: EPA is proposing a regulatory program to help mitigate the
potential for misfueling of certain engines, vehicles and equipment
with gasoline containing greater than 10 volume percent (``vol%'')
ethanol up to 15 vol% ethanol (E15). This proposal is in conjunction
with the Agency's partial waiver, pursuant to Clean Air Act section
211(f)(4), which allows for the introduction into commerce of gasoline-
ethanol blends containing up to 15 vol% ethanol for use in model year
2007 and newer on-highway light-duty motor vehicles. The E15 waiver is
limited in scope to a portion of the light-duty fleet, and the proposed
misfueling mitigation program will help avoid the misfueling of all
other engines, vehicles, and equipment with unapproved fuels. This
proposed rule would require all E15 gasoline fuel dispensers to have a
label if a retail station chooses to sell E15 and seeks comment on
separate labeling requirements for fuel blender pumps and fuel pumps
that dispense E85. Similar to the prohibition in section 211(f)(1), the
proposed rule would prohibit the use of gasoline containing greater
than 10 vol% ethanol in vehicles and engines not covered by the partial
waiver for E15. In addition, the proposed rule would require product
transfer documents specifying ethanol content and Reid Vapor Pressure
(RVP) to accompany the transfer of gasoline blended with ethanol and a
national survey of retail stations to ensure compliance with the these
requirements. The proposed rule would also modify the Reformulated
Gasoline (``RFG'') program by updating the Complex Model to allow fuel
manufacturers to certify batches of gasoline containing up to 15 vol%
ethanol.

DATES: Comments must be received on or before January 3, 2011. Under
the Paperwork Reduction Act, comments on the information collection
provisions are best assured of full consideration if the Office of
Management and Budget (OMB) receives a copy of your comments on or
before December 6, 2010, thirty days after date of publication in the
Federal Register.
    Hearing: We will hold a public hearing on November 16, 2010 at the
Millennium Knickerbocker Hotel in Chicago, IL. The hearing will start
at 10 a.m. local time and continue until everyone has had a chance to
speak. If you want to testify at the hearing, notify the contact person
listed under FOR FURTHER INFORMATION CONTACT by November 8, 2010.

ADDRESSES: Submit your comments, identified by Docket ID No. EPA-HQ-
OAR-2010-0448, by one of the following methods:
     http://www.regulations.gov: Follow the on-line
instructions for submitting comments.
     E-mail<EMAIL_ADDRESS>     Fax:<PHONE_NUMBER>.
     Mail: Air and Radiation Docket, Docket ID No. EPA-HQ-OAR-
2010-0448, Environmental Protection Agency, Mailcode: 6102T, 1200
Pennsylvania Avenue, NW., Washington, DC 20460. Please include a total
of two copies.
     Hand Delivery: EPA Docket Center, Public Reading Room, EPA
West Building, Room 3334, 1301 Constitution Avenue, NW., Washington, DC
20460. Such deliveries are only accepted during the Docket's normal
hours of operation, and special arrangements should be made for
deliveries of boxed information.
    Instructions: Direct your comments to Docket ID No. EPA-HQ-OAR-
2010-0448. EPA's policy is that all comments received will be included
in the public docket without change and may be made available online at
http://www.regulations.gov, including any personal information
provided, unless the comment includes information claimed to be
Confidential Business Information (CBI) or other information whose
disclosure is restricted by statute. Do not submit information that you
consider to be CBI or otherwise protected through http://
www.regulations.gov or e-mail. The http://www.regulations.gov Web site
is an ``anonymous access'' system, which means EPA will not know your
identity or contact information unless you provide it in the body of
your comment. If you send an e-mail comment directly to EPA without
going through http://www.regulations.gov your e-mail address will be
automatically captured and included as part of the comment that is
placed in the public docket and made available on the Internet. If you
submit an electronic comment, EPA recommends that you include your name
and other contact information in the body of your comment and with any
disk or CD-ROM you submit. If EPA cannot read your comment due to
technical difficulties and cannot contact you for clarification, EPA
may not be able to consider your comment. Electronic files should avoid
the use of special characters, any form of encryption, and be free of
any defects or viruses. For additional information about EPA's public
docket, visit the EPA Docket Center homepage at http://www.epa.gov/
epahome/dockets.htm. For additional instructions on submitting
comments, go to ``What Should I Consider as I Prepare My Comments for
EPA?'' in the SUPPLEMENTARY INFORMATION section of this document.
    Docket: All documents in the docket are listed in the http://
www.regulations.gov index. Although listed in the index, some
information is not publicly available, e.g., CBI or other information
whose disclosure is restricted by statute. Certain other material, such
as copyrighted material, will be publicly available only in hard copy.
Publicly available docket materials are available either electronically
in http://www.regulations.gov or in hard copy at the Air and Radiation
Docket, EPA/DC, EPA West, Room 3334, 1301 Constitution Ave., NW.,
Washington, DC. The Public Reading Room is open from 8:30 a.m. to 4:30
p.m., Monday through Friday, excluding legal holidays. The telephone
number for the Public Reading Room is<PHONE_NUMBER>, and the telephone
number for the Air Docket is<PHONE_NUMBER>.

FOR FURTHER INFORMATION CONTACT: Julia MacAllister, Office of
Transportation and Air Quality, Assessment and Standards Division,
Environmental Protection Agency, 2000 Traverwood Drive, Ann Arbor, MI
48105; Telephone number:<PHONE_NUMBER>; Fax number:<PHONE_NUMBER>; E-mail
address<EMAIL_ADDRESS>or Assessment and Standards
Division Hotline; telephone number<PHONE_NUMBER>; E-mail address
<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Does This Action Apply to Me?

    Entities potentially affected by this action include those involved
with the production, importation, distribution, marketing, or retailing
of diesel fuel and production of gasoline. Categories and entities
affected by this action include:

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                                                                       NAICS \1\
                             Category                                    codes       SIC \2\ codes       Examples of potentially regulated entities
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Industry..........................................................          324110            2911  Petroleum refineries.
Industry..........................................................          325193            2869  Ethyl alcohol manufacturing.
Industry..........................................................          424710            5171  Petroleum bulk stations and terminals.
Industry..........................................................          424720            5172  Petroleum and petroleum products merchant
                                                                                wholesalers.
Industry..........................................................          454319            5989  Other fuel dealers.
Industry..........................................................          447190            5541  Gasoline service stations.
                                                                                Marine service stations.
                                                                                Truck stops.
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    This table is not intended to be exhaustive, but rather provides a
guide for readers regarding entities likely to be affected by this
action; however, other types of entities not listed in the table could
also be affected. To determine whether your entity is affected by this
action, you should examine the applicability criteria of Parts 79 and
80 of title 40 of the Code of Federal Regulations. If you have any
question regarding applicability of this action to a particular entity,
consult the person in the preceding FOR FURTHER INFORMATION CONTACT
section.

What should I consider as I prepare my comments for EPA?

    A. Submitting CBI. Do not submit this information to EPA through
http://www.regulations.gov or e-mail. Clearly mark the information that
you claim to be CBI. For CBI information on a disk or CD ROM that you
mail to EPA, 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 claimed as CBI. In addition to one complete version
of the comment that includes information claimed as CBI, a copy of the
comment that does not contain the information claimed as CBI must be
submitted for inclusion in the public docket. Information marked as CBI
will not be disclosed except in accordance with procedures set forth in
40 CFR Part 2.
    B. Tips for Preparing Your Comments. When submitting comments,
remember to:
     Identify the rulemaking by docket number and other
identifying information (subject heading, Federal Register date and
page number).
     Follow directions--The agency may ask you to respond to
specific questions or organize comments by referencing a Code of
Federal Regulations (CFR) part or section number.
     Explain why you agree or disagree; suggest alternatives
and substitute language for your requested changes.
     Describe any assumptions and provide any technical
information and/or data that you used.
     If you estimate potential costs or burdens, explain how
you arrived at your estimate in sufficient detail to allow for it to be
reproduced.
     Provide specific examples to illustrate your concerns, and
suggest alternatives.
     Explain your views as clearly as possible, avoiding the
use of profanity or personal threats.
     Make sure to submit your comments by the comment period
deadline identified.
    C. Docket Copying Costs. You may be charged a reasonable fee for
photocopying docket materials, as provided by 40 CFR Part 2.

Outline of This Preamble

I. Overview
II. Background
    A. Statutory Authority
    B. E15 Waiver Request
    C. Reasons for the Proposed Actions in This Rulemaking
    D. Federalism Implications
III. Misfueling Mitigation Measures
    A. Labeling Requirements
    1. E15 Labels
    a. Information Component
    b. Legal Approval Component
    c. Technical Warning Component
    d. Legal Warning Component
    e. E15 Label Proposal
    2. Additional Fuel Pump Labeling Requirements
    3. Stakeholder Labeling Suggestions
    4. FTC Labeling Proposal
    5. Labeling Requirements and Liability for Misfueling
    B. Product Transfer Document Requirements
    1. PTD Requirements Downstream of the Point of Ethanol Addition
    2. PTD Requirements Up to and Including the Point of Ethanol
Addition
    3. General PTD Requirements
    C. Retail Fuel Dispenser Label and Fuel Ethanol Content Survey
    D. Program Outreach
    E. What Other Means of Mitigating Misfueling Were Considered?
    F. Cost of Compliance
    1. Labeling Costs
    2. PTD Costs
    3. Survey Costs
    4. Avoided Motor Vehicle and Nonroad Product Repair Costs
    G. Compliance and Enforcement
    1. What are the Prohibited Acts?
    2. What are the Proposed Liability and Penalty Provisions for
Noncompliance?
    a. Presumptive Liability
    b. Affirmative Defenses for Liable Parties
    c. Penalties for Violations
IV. Other Measures to Ensure Compliance
    A. The 1.0 psi RVP Waiver for E10 Blends
    1. National RVP Survey
    2. RVP and E15 Underground Storage Tank Transition
    B. Credit for RFG Downstream Oxygenate Blending
V. Modification of the Complex Model
    A. Background of RFG Requirements
    B. The Complex Model
VI. Why are we proposing misfueling mitigation measures?
    A. History of Ethanol Use in the U.S.
    B. Chemical and Physical Differences between Ethanol and
Gasoline
    1. Impact on the A/F Ratio--Combustion Enleanment
    2. Polarity and affinity for water
    3. Material Compatibility
    4. Corrosion
    5. Solvency
    6. Volatility
    C. Model Year 2000 and Older Light-Duty Motor Vehicles
    1. Enleanment
    2. Material Compatibility
    3. Motor Vehicle Population and Anticipated Emissions Impact
    D. Heavy-duty Gasoline Engines and Vehicles
    E. Motorcycles
    F. Nonroad Engines, Vehicles, and Equipment (Nonroad Products)
    1. Introduction
    2. Enleanment
    3. Material Compatibility and Corrosion
    4. Phase Separation and Solvency/Detergency
    G. Model Year 2007 and Newer Light-duty Motor Vehicles
    H. Model Year 2001-2006 Motor Vehicles
    I. Emissions Impact Summary and Conclusions
VII. What is our legal authority for proposing these misfueling
mitigation measures?
    A. Health and Welfare Concerns of Air Pollution Caused by E15
    B. Impact of E15 Emission Products on Emission Control Systems
    C. Effect of Misfueling Mitigation Measures on the Use of Other
Fuels or Fuel Additives
VIII. Public Participation
    A. How Do I Submit Comments?
    B. How Should I Submit CBI to the Agency?
    C. Will There Be a Public Hearing?
    D. Comment Period
    E. What Should I Consider as I Prepare My Comments for EPA?
IX. Administrative Requirements

    A. Executive Order 12866: Regulatory Planning and Review
    B. Paperwork Reduction Act
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. Executive Order 13132 (Federalism)
    F. Executive Order 13175
    G. Executive Order 13045: Protection of Children from
Environmental Health Risks and Safety Risks
    H. Executive Order 13211: Actions Concerning Regulations That
Significantly Affect Energy Supply, Distribution, or Use
    I. National Technology Transfer and Advancement Act
    J. Executive Order 12898: Federal Actions to Address
Environmental Justice in Minority Populations and Low-Income
Populations

I. Overview

    In today's action, the U.S. Environmental Protection Agency (EPA or
the Agency) is proposing regulations to mitigate the potential for
misfueling of vehicles and engines with gasoline containing up to 15
vol% ethanol (E15).\1\ These regulations are being proposed in
conjunction with today's action by EPA granting of a partial waiver for
ethanol blends up to 15 vol% ethanol under section 211(f)(4) of the
Clean Air Act (CAA or the Act). This partial waiver will allow the
introduction into commerce of E15 for use in 2007 model year (MY) and
newer light-duty motor vehicles. In partially granting the E15 waiver,
EPA imposed a number of conditions on the refiners and renewable fuel
producers subject to the waiver. These conditions are designed to help
ensure that E15 is introduced into commerce for use in MY2007 and newer
light-duty motor vehicles and flexible-fueled vehicles, and not for use
in any other vehicles or engines. Some of the regulatory provisions
proposed today parallel those conditions and are expected to be a more
efficient way to help ensure that the conditions of the E15 partial
waiver decision are met and to minimize in-use emissions increases that
might result from misfueling vehicles and engines with E15. The
proposed safeguards would also promote the successful introduction of
E15 into commerce.
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    \1\ For purposes of this preamble, E15 refers to gasoline-
ethanol blended fuels that contain greater than 10 vol% and no more
than 15 vol% ethanol content.
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    We are proposing four requirements as part of our misfueling
mitigation regulations. The first requirement, consistent with the
partial waiver being granted today, is a prohibition against using E15
in MY2000 and older motor vehicles, heavy-duty gasoline engines and
vehicles, on and off-highway motorcycles,\2\ and nonroad engines,
vehicles, and equipment.\3\ This prohibition is similar in nature to
the prohibition on producers of fuels and fuel additives under section
211(f)(1); however, the prohibition in section 211(f)(1) only applies
to these upstream parties. The prohibitions proposed today would apply
at the retail level as well as upstream. The conditions on the partial
waiver and the regulations proposed today are similar in nature and
have a common goal--ensuring that E15 is used in appropriate motor
vehicles covered by the partial waiver, and is not used in other motor
vehicles and engines. Since the Agency is deferring a decision for
MY2001-2006 light-duty motor vehicles, we are not proposing a
prohibition with respect to the fuel used in these motor vehicles at
this time. DOE testing of MY2001-2006 light-duty motor vehicles is
ongoing and EPA expects to make a waiver determination for these
vehicles shortly after the results of the DOE testing are available. If
EPA does not grant an E15 waiver for MY2001-2006 light-duty motor
vehicles, then we would expect to include the same prohibitions for
these MY motor vehicles in the final rulemaking.
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    \2\ For purposes of this preamble on and off-highway motorcycles
are referred to collectively as ``motorcycles.''
    \3\ For purposes of this preamble, nonroad engines, vehicles,
and equipment are referred to as ``nonroad products.''
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    Second, we are proposing labeling requirements for fuel pumps that
dispense E15 to effectively inform consumers regarding the appropriate
fuel to be used in vehicles and engines. Third, EPA proposes that
product transfer documents (PTDs) from refiners, gasoline terminals,
and oxygenate blenders specify the ethanol content or approved level of
ethanol addition, of the fuel being sold to retail stations or
wholesale purchaser-consumer to ensure that retail stations and
wholesale purchaser-consumers know the level of ethanol content they
are buying so that, in turn, the retail pumps can be properly labeled.
Fourth, EPA proposes a national survey requirement on ethanol producers
and the blenders of E15 (e.g., refiners, gasoline terminals, oxygenate
blenders) to ensure that retail station pumps are in fact being labeled
properly. EPA is seeking comment on including an RVP component to this
national E15 labeling survey to help ensure that summertime RVP
requirements are being met throughout the gasoline distribution chain.
To avoid confusion for consumers when pumps are not labeled, the Agency
is also seeking comment on requiring the labeling of non-E15 pumps. The
Agency has used such misfueling mitigation strategies to implement
several fuel programs over the past thirty years, including the
unleaded gasoline program, the RFG program, and the diesel sulfur
program. The Agency believes that the misfueling mitigation measures
proposed in this rulemaking, coupled with the E15 waiver and a
substantial consumer education and outreach effort by industry, can be
an effective strategy to help reduce misfueling and the associated
emissions impacts while enabling the use of E15 in appropriate
vehicles.
    The misfueling mitigation program proposed today generally mirrors
the misfueling conditions in today's partial waiver decision. While the
waiver provides an opportunity for a fuel or fuel additive manufacturer
to meet the conditions, the Agency believes that the proposed
safeguards would provide the most practical method of addressing the
purposes and satisfying the conditions of today's partial waiver
decision.
    These misfueling mitigation regulations are proposed under CAA
section 211(c), based on the projected emission increases that would be
avoided by deterring the use of E15 in older motor vehicles, heavy-duty
gasoline engines and vehicles, motorcycles and nonroad products.
Engineering judgment supported by test data, where available, forms the
basis for our technical review and conclusions. Our engineering
assessment described in Section VI identifies a number of emissions
related concerns with the long-term use of E15 in MY2000 and older
light-duty motor vehicles, heavy-duty gasoline engines and vehicles,
motorcycles, and nonroad products. For motor vehicles these concerns
include the potential for catalyst deterioration or catalyst failure as
well as material compatibility issues that could lead to extremely
elevated exhaust and evaporative emissions. For nonroad products and
for motorcycles the misfueling concerns include not only the potential
for elevated exhaust and evaporative emissions but also the potential
for engine failure from overheating. While it is not possible to
quantify precisely the frequency at which motor vehicles and nonroad
products might experience these problems with the use of E15, we
believe that emissions related problems could potentially occur with
enough frequency that the resulting emission benefits from avoiding
misfueling would outweigh the relatively low cost imposed by the
proposed regulations. This would justify the proposed rule,

even if a very low percentage of vehicle and engines experiences
problems.
    As described below in Section VI and in the E15 partial waiver
decision document,\4\ our assessment indicates that manufacturers have
designed at least MY2007 and newer light-duty motor vehicles to be
durable for use on gasoline blends up to E15. This conclusion is
primarily based on the recently completed catalyst durability test
program conducted by the Department of Energy (DOE) wherein they tested
19 vehicle models representative of the Tier 2 motor vehicle fleet out
to their full useful life. The study found that Tier 2 motor vehicles
continued to meet their emissions standards after operating on E15 for
full useful life mileage accumulation. Additionally, according to our
analysis of the DOE test data, for Tier 2 motor vehicles we found no
statistically significant increases in the emissions of regulated
pollutants for motor vehicles operating on E15, and no apparent
material compatibility issues, when compared to vehicles that were
operated on E0.\5\ These results confirm our engineering assessment
that MY2007 and newer motor vehicle's emissions should be less
sensitive to the increased ethanol content in E15. This engineering
assessment is based on the advances in motor vehicle materials and
technology in response to in-use experience with E10 and the
requirement that motor vehicles comply with a series of important new
EPA emission requirements over the years, e.g., enhanced evaporative
emission standards and E10 durability testing, supplemental FTP
emission standards, CAP2000 in-use durability requirements, and the
Tier 2 motor vehicle standards themselves.
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    \4\ See Partial Grant and Partial Denial of Clean Air Act Waiver
Application Submitted by Growth Energy to Increase the Allowable
Ethanol Content of Gasoline to 15 Percent; Decision of the
Administrator elsewhere in this issue of the Federal Register.
    \5\ See Partial Grant and Partial Denial of Clean Air Act Waiver
Application Submitted by Growth Energy to Increase the Allowable
Ethanol Content of Gasoline to 15 Percent; Decision of the
Administrator elsewhere in this issue of the Federal Register.
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    For MY2001-2006 light-duty motor vehicles, it is currently less
clear whether they could experience significant emission increases when
fueled on E15 like MY2000 and older motor vehicles, or continue to
function properly like the newer 2007 and newer motor vehicles. On the
one hand we believe that many of the same elements for ethanol
compatibility of MY2007 and newer light-duty motor vehicles also apply
to MY2001-2006 light-duty motor vehicles (e.g., enhanced evaporative
emission standards, SFTP, CAP2000). On the other hand, they were not
all required to demonstrate evaporative emission system durability on
E10 or to upgrade their catalyst and emission control systems to the
extent needed to comply with the Tier 2 standards. Furthermore,
currently available test data on these model year vehicles is much more
limited. DOE is in the process of developing relevant data for these
model year vehicles. Specifically, DOE is conducting catalyst
durability testing on six motor vehicle models certified to NLEV
standards and two motor vehicles certified to Tier 1 standards
scheduled to be completed in November, 2010. Additionally, a study of
in-use motor vehicles by Rochester Institute of Technology on E20 \6\
suggests such motor vehicles may operate acceptably on E20--and by
interpolation E15. However, the mileage accumulation of RIT test
vehicles is limited and the study is still ongoing until November 2010.
This additional information, as well as information gathered through
comment on this proposal and any final decision on a section 211(f)
waiver for MY2001-2006 light-duty motor vehicles, will be considered in
the decisions made for the final rule.
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    \6\ The effect of E20 ethanol fuel on vehicle emissions, B
Hilton and B Duddy, Center for Integrated Manufacturing Studies,
Rochester Institute of Technology, June 26, 2009. See Docket ID No.
EPA-HQ-OAR-2010-0448.
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    In addition to misfueling mitigation measures, today's action also
proposes slight modifications to the Reformulated Gasoline and
Antidumping fuels programs to open the way for refiners and importers
to produce and certify gasoline containing up to 15 vol% ethanol. To
measure compliance with the RFG and anti-dumping standards, the
emissions performance of gasoline is calculated using a model, called
the Complex Model, which predicts the emissions of each regulated
pollutant based on the measured values of certain gasoline properties.
For gasoline to be sold in the U.S., it must comply with the RFG and
Antidumping standards and refiners are required to certify that their
fuel meets the standards by using the Complex Model. Currently, the
equations in the model are limited to an oxygen content of no more than
4.0% by weight in gasoline, which is the maximum possible amount of
oxygen in E10. EPA is proposing to modify the Complex Model to allow
fuel manufacturers to certify batches of E15 fuel.
    Finally, EPA proposes to require that Reid Vapor Pressure (RVP) be
identified on PTDs from fuel refineries to oxygenate blenders for
conventional gasoline to ensure that EPA summertime RVP requirements
are met. This is necessary because the waiver announced today is for
blends that meet the summertime gasoline volatility standards for
conventional gasoline.\7\ In order to introduce a fuel that meets both
the Federal summertime RVP standards and contains between 10 and 15
vol% ethanol, fuel refiners would have to create a fuel or blendstock
that has approximately 1.0 psi lower RVP than a fuel or blendstock
intended for E10 due to the interaction between gasoline volatility and
ethanol when blended. Oxygenate blenders would need to know the RVP of
a blendstock or have the intended ethanol content of a blendstock be
specified on the PTD to ensure that they know the correct amount of
ethanol that should be blended into a fuel. The Agency is not proposing
to change RFG PTD requirements found at 40 CFR 80.77 since RVP is
carefully controlled throughout the distribution chain in order to
comply with summertime RFG VOC emissions performance standards.
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    \7\ See section IV.A. for more information on the 1.0 psi RVP
waiver.
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II. Background

A. Statutory Authority

    CAA section 211(f)(1) makes it unlawful for any manufacturer of any
fuel or fuel additive to first introduce into commerce, or to increase
the concentration in use of, any fuel or fuel additive for use in motor
vehicles manufactured after model year 1974 unless it is substantially
similar to any fuel or fuel additive utilized in the certification of
any model year 1975, or subsequent model year, vehicle or engine under
section 206 of the Act.
    Section 211(f)(4) of the Act provides that upon application by any
fuel or fuel additive manufacturer, the Administrator may waive the
prohibition of section 211(f)(1). A waiver may be granted if the
Administrator determines that the applicant has established that the
fuel or fuel additive, and the emission products of such fuel or fuel
additive, will not cause or contribute to a failure of any emission
control device or system (over the useful life of the motor vehicle,
motor vehicle engine, nonroad engine or nonroad vehicle in which such
device or system is used) to achieve compliance with the emission
standards to which the vehicle or engine has been certified. In other
words, the Administrator may grant a waiver for an

otherwise prohibited fuel or fuel additive if the applicant can
demonstrate that the fuel or fuel additive will not cause or contribute
to engines, vehicles or equipment failing to meet their emissions
standards over their useful life.
    EPA previously issued a ``substantially similar'' interpretive rule
for unleaded gasoline which allows oxygen content up to 2.7% by weight
for certain ethers and alcohols.\8\ E10 contains approximately 3.5%
oxygen by weight, which means E10 is not ``substantially similar'' to
certification fuel under the current interpretation. As explained at 44
FR 20777 (April 6, 1979), E10 received a waiver of the substantially
similar prohibition by operation of law since EPA did not grant or deny
a waiver request for a fuel containing 90% unleaded gasoline and 10%
ethyl alcohol within 180 days of receiving that request. This waiver by
operation of law was based on the then current terms of CAA section
211(f)(4), which has subsequently been amended.
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    \8\ See 56 FR 5352 (February 11, 1991).
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    Section 211(c)(1) of the Act allows the Administrator, by
regulation, to ``control or prohibit the manufacture, introduction into
commerce, offering for sale, or sale of any fuel or fuel additive for
use in a motor vehicle, motor vehicle engine, or nonroad engine or
nonroad vehicle (A) if, in the judgment of the Administrator, any fuel
or fuel additive or any emission product of such fuel or fuel additive
causes, or contributes, to air pollution or water pollution (including
any degradation in the quality of groundwater) that may reasonably be
anticipated to endanger the public health or welfare, or (B) if
emission products of such fuel or fuel additive will impair to a
significant degree the performance of any emission control device or
system which is in general use, or which the Administrator finds has
been developed to a point where in a reasonable time it would be in
general use were such regulation to be promulgated.'' Today's proposed
misfueling regulations are based on this authority in section
211(c)(1), as well as our recordkeeping and information collection
authority under sections 208 and 114.

B. E15 Waiver Request

    On March 6, 2009, Growth Energy and 54 ethanol manufacturers
submitted an application to EPA for a waiver under section 211(f)(4) of
the CAA. This application sought a waiver for ethanol-gasoline blends
of up to 15 vol% ethanol.\9\ On April 21, 2009, EPA published notice of
the receipt of the application, and, as required by CAA section
211(f)(4) of the Act, EPA requested public comment on all aspects of
the waiver application, to assist the Administrator in determining
whether the statutory basis for granting the waiver request for
ethanol-gasoline blends containing up to 15 vol% ethanol had been met.
(See 74 FR 18228).
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    \9\ Since E15 has greater than 2.7 wt% oxygen content, E15 needs
a waiver under CAA section 211(f)(4).
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    In a separate action today, EPA waived the prohibition in CAA
section 211(f)(1) to allow introduction into commerce of E15 for use in
MY2007 and newer light-duty motor vehicles, including passenger cars,
light-duty trucks and medium duty passenger vehicles (hereafter light-
duty motor vehicles). EPA is deferring a decision concerning MY2001-
2006 light-duty motor vehicles, and has denied the waiver for all other
motor vehicles.\10\ EPA's partial waiver decision is based on a
determination that E15 will not cause or contribute to a failure of
MY2007 and newer light-duty motor vehicles to achieve compliance with
the emissions standards to which they were certified under section 206
of the CAA over their useful lives. EPA is still evaluating the effect
of E15 on MY2001-2006 light-duty motor vehicles to determine whether a
waiver of CAA section 211(f)(1) is appropriate for use of E15 in those
motor vehicles. EPA also decided that it could not make such a
determination and therefore was denying the waiver for all other motor
vehicles, including MY2000 and older light-duty motor vehicles. EPA
requests comment and additional information regarding the use of E15 in
MY 2000 and older motor vehicles.
---------------------------------------------------------------------------

    \10\ See Partial Grant and Partial Denial of Clean Air Act
Waiver Application Submitted by Growth Energy to Increase the
Allowable Ethanol Content of Gasoline to 15 Percent; Decision of the
Administrator elsewhere in this issue of the Federal Register.
---------------------------------------------------------------------------

    EPA issued the partial waiver with several conditions, some of
which would be fulfilled by the safeguards being proposed today. The
conditions apply to the upstream parties subject to the waiver
(refiners, producers of ethanol and oxygenate blenders that introduce
E15 into commerce), and are designed to ensure that when E15 is
introduced into commerce, it will only be used in the appropriate
light-duty motor vehicles. Some of the conditions call for the ethanol
blenders, fuel manufacturers, and fuel additive manufacturers (ethanol
producers) to take various actions to control the distribution and use
of their product so that E15 is only used in approved motor vehicles.
The partial waiver imposes different conditions on the different
parties. Ethanol blenders, fuel manufacturers, and ethanol producers
that introduce E15 into commerce are all responsible for making sure
that appropriate labeling occurs on fuel pumps to mitigate potential
misfueling. However, this condition, in particular, may be difficult
for these parties to satisfy given their limited control over actions
taken at retail, which, as discussed below, prompted today's proposal
for fuel pump labels. All three parties are also responsible for
conducting fuel pump labeling surveys to ensure that pumps are properly
labeled and that the correct ethanol blends are loaded into the
appropriate tanks at retail stations. Ethanol blenders and fuel
manufacturers must also use PTDs to properly document information
regarding the ethanol blends to help ensure proper blending and
distribution.
    In June 2010 EPA received a request from ADM to consider, within
the context of the E15 waiver application, a waiver for E12 for all
motor vehicles.\11\ As discussed in the E15 waiver decision document,
EPA concluded that there was insufficient basis to support such a
waiver for motor vehicles or nonroad products beyond the MY2007 and
newer model year light-duty motor vehicles for which the E15 waiver was
being granted.
---------------------------------------------------------------------------

    \11\ Woertz, P.A. Letter to Lisa P. Jackson. 7 June 2010. See
Docket ID EPA-HQ-OAR-2009-0211.
---------------------------------------------------------------------------

C. Reasons for the Proposed Actions in This Rulemaking

    The proposed rules would directly prohibit or control the
distribution and use of E15. The rules would apply to parties such as
retail stations that are not directly subject to the conditions on the
waiver. Collectively, these provisions would mitigate misfueling and
maximize the likelihood that E15 is only used in approved motor
vehicles. This would also promote the successful introduction of E15
into commerce. The specific provisions are discussed in detail in
Sections III-V.
    In this action, the Agency is proposing to use its authority to
help minimize the potential for emissions increases associated with
misfueling with E15. Importantly, the proposed safeguards would also
assist the ethanol producers and blenders in carrying out the
conditions of the waiver. EPA realizes that ethanol blenders, fuel
manufacturers, and ethanol producers

may have difficulty satisfying the conditions outlined in the E15
partial waiver decision, particularly the fuel pump labeling
requirements. Most retail stations are independently owned and
operated, which may make it difficult for the ethanol blenders, fuel
manufacturers, and ethanol producers to ensure that labels are properly
placed on fuel pumps dispensing E15. Under CAA section 211(f)(4), EPA
is limited in what kind of conditions it can place on a waiver decision
and on whom those conditions may be placed. For example, EPA placed the
partial waiver conditions on the ethanol blenders, fuel manufacturers,
and ethanol producers, the parties subject to the prohibition in
section 211(f)(1), and not on the retail stations. This makes it
difficult to ensure effective or complete pump labeling and misfueling
mitigation. Without Agency action that requires the provisions proposed
in today's rulemaking (i.e. fuel pump labeling, PTDs, and a national
survey), the conditions contained in the E15 partial waiver decision
would likely make the distribution of E15 impracticable. However, under
CAA section 211(c), EPA has the authority to adopt appropriate controls
or prohibitions on the distribution and sale of fuels and fuel
additives to avoid emissions increases. EPA's proposed use of this
authority would also assist the ethanol blenders, fuel manufacturers,
and ethanol producers in carrying out the conditions of the partial
waiver so the conditions on the E15 partial waiver are properly
implemented. Today's rulemaking also provides EPA with additional tools
for regulatory oversight of the ethanol blenders, fuel manufacturers,
and ethanol producers introducing E15 into commerce.

D. Federalism Implications

    As mentioned in Section II.A, the proposed prohibition regarding
use of E15 in MY2000 and older vehicles, heavy-duty gasoline engines
and vehicles, motorcycles, and nonroad engines, vehicles, and equipment
is based on the authority in section 211(c)(1) of the Act, as well as
our recordkeeping and information collection authority under sections
208 and 114. Section 211(c)(4)(A) of the CAA provides that no State or
political subdivision thereof may prescribe or attempt to enforce ``for
purposes of motor vehicle emission control'' any control or prohibition
``respecting any characteristic or component of a fuel or fuel
additive'' in a motor vehicle or motor vehicle engine if EPA has
prescribed a control or prohibition applicable to such characteristic
or component of the fuel or fuel additive under section 211(c)(1). This
prohibition applies to all States except California, as provided in
section 211(c)(4)(B). Also, section 211(c)(4)(A) applies only to
controls or prohibitions respecting any characteristics or components
of fuels or fuel additives for motor vehicles or motor vehicle engines,
that is, highway vehicles. Therefore, a State control or prohibition
would be preempted under section 211(c)(4)(A), only if it is ``for the
purposes of motor vehicle emission control.'' Further, even if a State
rule is established for purposes of motor vehicle emission control, it
will not be preempted under section 211(c)(4)(A) unless it is for the
same ``characteristic or component of a fuel or fuel additive in a
motor vehicle or motor vehicle engine'' for which EPA has prescribed a
control or prohibition under section 211(c)(1)(A). Today's action
proposes a rule that would limit the ethanol content in fuel used in
certain vehicles and engines as well as proposes misfueling mitigation
measures to effectuate that limitation.
    The Agency is not aware of any State rules or laws that would be
preempted by today's proposed rule if adopted. States have not
controlled ethanol volumes in gasoline for purposes of motor vehicle
emission control. Also, our rule would not require States to change
their existing labels. The rule as proposed would impose no substantial
direct costs, nor would it have any substantial direct effects on State
or local governments. EPA requests comments on the issue of preemption
of State fuel programs.
    Further, EPA consulted with State and local officials early in the
process of developing the proposed action to permit them to have
meaningful and timely input into its development. EPA met with members
of the National Association of Clean Air Agencies (NACAA) to discuss
the nature of today's proposed rule. Additionally, we provided State
and local governments an opportunity to provide comment on the
implementation of misfueling mitigation measures for a partial E15
waiver in both the RFS2 NPRM (see 74 FR 25016) and the E15 waiver
request notice (see 74 FR 18228). We received comments from only one
State on this issue in the RFS2 NPRM, and it supported efforts for
properly labeling fuel pumps containing gasoline-ethanol blends.

III. Misfueling Mitigation Measures

    As explained above, CAA section 211(c) grants the Agency authority
to control or prohibit the distribution of a fuel or fuel additive when
it will significantly impair emission controls or the emission products
from that fuel will cause or contribute to air pollution that we
reasonably anticipate may endanger public health or welfare. As more
fully discussed in Section VI, we are proposing to prohibit use of E15
in MY2000 and older light-duty motor vehicles, and in all heavy-duty
gasoline engines and vehicles, motorcycles and nonroad products based
on the projected increased emissions that would occur from using E15 in
those motor vehicles and nonroad products. We are also proposing to
prohibit gasoline retail stations and wholesale purchaser-consumer
facilities from selling E15 for use in these products if pumps at those
locations are not properly labeled. Since the Agency is deferring a
decision for MY2001-2006 light-duty motor vehicles, we are not
proposing a prohibition for fuel used in these motor vehicles at this
time. DOE testing of MY2001-2006 light-duty motor vehicles is ongoing
and EPA expects to make a waiver determination for these vehicles
shortly after the results of the DOE testing are available. If EPA does
not grant an E15 waiver for MY2001-2006 light-duty motor vehicles, then
we would expect to include the same prohibitions for these MY motor
vehicles in the final rulemaking .\12\
---------------------------------------------------------------------------

    \12\ Even though we are not proposing an actual prohibition for
motor vehicles MY2001-2006, it is still unlawful to use E15 in these
motor vehicles until an E15 waiver is granted for these motor
vehicles.
---------------------------------------------------------------------------

    EPA is proposing a misfueling mitigation strategy to effectuate
those proposed prohibitions and to more generally limit the use of E15
to MY2007 and newer light-duty motor vehicles as approved today in the
E15 partial waiver decision. We believe that there are four important
components to an effective misfueling mitigation strategy for reducing
the potential for misfueling with E15. First, effective labeling is a
key factor. Labeling is needed to inform consumers of the potential
impacts of using E15 in vehicles and engines not approved for its use,
to mitigate the potential for intentional and unintentional misfueling
of these vehicles and engines. Labeling is also done at the point of
sale where the consumer most likely will be choosing which fuel to use.
Second, retail stations and wholesale purchaser-consumers need
assurance regarding the ethanol content of the fuel that they purchase
so they can direct the fuel to the appropriate storage tank and
properly label their fuel pumps. The use of proper

documentation in the form of PTDs has proven to be an effective means
of both ensuring that retail stations know what fuel they are
purchasing and as a possible defense for retail stations in cases of
liability in the event of a violation of EPA standards. Third, national
labeling and fuel sampling surveys are necessary to ensure that retail
stations are complying with labeling requirements, ethanol blenders are
not blending more than the stated amount of ethanol on PTDs, and
assuring downstream compliance for fuel refiners. The Agency has used
this general strategy to implement several fuel programs over the past
thirty years, including the unleaded gasoline program, the RFG program,
and the diesel sulfur program. EPA solicits comments on all of these
provisions as more fully described below.
    The fourth component of an effective misfueling mitigation strategy
is effective public outreach and consumer education. Outreach to
consumers and stakeholders is critical to mitigate misfueling incidents
that can result in increased emissions and vehicle or engine damage.
Consumers will need to be engaged through a variety of media to ensure
that accurate information is conveyed to the owners and operators of
vehicles and engines.
    The misfueling mitigation program proposed today generally mirrors
the misfueling conditions in today's partial waiver decision. While the
waiver provides an opportunity for a fuel or fuel additive manufacturer
to meet the conditions, the Agency believes that the proposed the
measures would provide the most practical method of meeting the
purposes of and satisfying the conditions of today's partial waiver
decision.

A. Labeling Requirements

    Today's rule proposes to require that retailers and wholesale
purchaser-consumers who choose to sell or dispense E15 must label any
dispensers of this gasoline-ethanol blend. We are also seeking comment
on requiring that dispensers of other gasoline-ethanol blends that
contain 10 vol% ethanol or less to be labeled at such time as a retail
station chooses to dispense E15 to help alleviate any confusion to
consumers. Additionally, we seek comment on requiring labels for E85
pumps and blender pumps.
1. E15 Labels
    We are proposing requirements that gasoline pumps dispensing E15 be
labeled. The label would have to indicate that the fuel contains up to
15 vol% ethanol--that is, the fuel is a gasoline-ethanol blend that
contains greater than 10 vol% ethanol but not more than 15 vol%
ethanol. Retailers and wholesale purchaser-consumers who choose to sell
E15 would be required to label pumps dispensing E15, clearly indicating
that the fuel should not be used in MY2000 and older motor vehicles,
motorcycles, heavy-duty gasoline engines and vehicles, or any nonroad
products. However, EPA also proposes that the label would be modified
if the E15 waiver is extended to earlier model year vehicles and/or
nonroad products.
    Based on the Agency's experience with fuel pump labeling for Ultra-
Low Sulfur Diesel (ULSD) and Low Sulfur Diesel (LSD) (see 40 CFR
80.570), there are four important elements to an effective label for
misfueling. The Agency proposes that the language of the E15 label
would have four components: (1) An information component; (2) a legal
approval component; (3) a technical warning component; and (4) a legal
warning component. Together, these four components highlight the
critical information necessary to inform consumers about the impacts of
using E15.
a. Information Component
    The first component informs consumers of the maximum ethanol
content the fuel may contain. For E15, the Agency proposes that the
information component of the label should contain two aspects, both an
acronym for the fuel (in this case E15) and a description of what the
acronym means (in this case informing consumers that the fuel may
consist of a range of ethanol up to a maximum of 15 vol% ethanol by
volume). We propose that this component of the label read:

    This fuel contains 15% ethanol maximum

We propose that this label be applied to any fuel dispenser with
greater than 10% ethanol but not more than 15 vol% ethanol. Thus, in
the case of any mid-grade fuel that might be blended from E10 and E15,
it would also be required to have the E15 label.
b. Legal Approval Component
    The second component of the label language would include
information that informs consumers of what vehicles and engines are
approved to use E15, mirroring EPA's decisions taken in the waiver
context. Since EPA granted a partial waiver of E15 limiting its legal
use to MY2007 and later light-duty motor vehicles, its use is only
permitted in these motor vehicles. Based on the partial waiver, the
Agency proposes that this portion of the label read as follows:

Use only in:
    2007 and newer gasoline cars
    2007 and newer light-duty trucks
    Flex-fuel vehicles.

As discussed elsewhere in today's proposal, if EPA decides to include
more model years in a subsequent waiver decision based on the findings
of the testing program, then the model year distinction on the label
would also need to be adjusted accordingly. We anticipate this will
occur before this rulemaking is finalized, and we will make that
adjustment in the final rule. Therefore, the proposed language could
read as follows:

Use only in:
    2001 and newer gasoline cars
    2001 and newer light-duty trucks
    Flex-fuel vehicles.
c. Technical Warning Component
    The third component of the label language would alert consumers
that use of E15 in other engines, vehicles, and equipment might cause
damage to these products. Our experience with past labeling provisions
supports the need for both the legal and technical warning so that
consumers are informed of the reason for the prohibition. As discussed
more fully in Section VI, it appears that use of E15 in these
particular products may not only lead to increased emissions but also
has the potential, even if limited in nature, to lead to damage of
motor vehicle and nonroad product components. Without this component to
the label, consumers may more likely be tempted to misfuel--
particularly if the price in the marketplace for E15 is lower than E10.
Therefore, EPA proposes the following language: ``This fuel might
damage other vehicles or engines.''
d. Legal Warning Component
    The fourth component of the label would inform consumers that using
E15 in a vehicle or engine not approved for E15 use violates Federal
law. This is similar to the approach used to mitigate the use of LSD in
2007 and newer on-highway diesel engines. Based on that experience, EPA
believes that explicitly notifying consumers that E15 is prohibited by
Federal law for use in MY2000 and older motor vehicles, heavy-duty
gasoline engines and vehicles, on and off-highway motorcycles, and all
nonroad products will result in consumers being less likely to misfuel.
    Based on the language currently used on the LSD label (see 40 CFR
80.570), the Agency proposes that the label read

as follows: ``Federal law prohibits its use in other vehicles and
engines.''
    The Agency has traditionally had ``WARNING'' language appear before
the legal warning component to better draw consumers' attention to the
prohibition of using a fuel in certain vehicles and engines (e.g. LSD
in 2007 and newer highway diesel vehicles). After consultation with
stakeholders, it was suggested that the Agency should both change
``WARNING'' to ``CAUTION!'' and place this language at the top of the
label. This would draw consumer attention to the label and help
mitigate both intentional and unintentional misfueling. Therefore, we
propose to have the word ``CAUTION!'' appear at the top of the label
before the information component. The Agency also considered the use of
the word ``ATTENTION'' instead of ``WARNING'' or ``CAUTION.'' We
specifically seek comment on using the term ``CAUTION!'' versus
``WARNING'' or ``ATTENTION''. In addition, the Agency is also
interested in whether using ``STOP'', with or without including a
depiction of a stop sign, would be an appropriate way to draw
consumers' attention to the label. We seek comment on whether there are
other words that would better convey the message to consumers.
e. E15 Label Proposal
    Taken together, the Agency proposes the following E15 label:
    [GRAPHIC] [TIFF OMITTED] TP04NO10.000

    EPA seeks comment on all aspects of the label language. For
example, we seek comment on whether any additional label language
should be required or whether any language should be removed. In
particular, we seek comment on ways to portray the information in ways
that are the most concise and meaningful to consumers. EPA proposes
that the pump labels for E15 be required to be placed on pumps that
will dispense E15 prior to any commercial sale of E15.
    One issue that arose from the labeling provisions of the diesel
sulfur program was that the diesel sulfur labeling provisions were
written in a way that allowed flexibility in color and design, causing
retailers difficulty with coming up with a suitable design that
satisfied EPA labeling requirements at the least possible cost. To help
address this issue, stakeholders met with EPA to discuss standardized
label designs that would both satisfy EPA diesel sulfur requirements
and make it easier for retail stations to procure labels. Labeling
templates were designed and made available to retail stations to use.
Based on this experience, we are proposing more explicit specifications
for the E15 label, covering not only the content, but also the
appearance of the E15 pump label.
    In today's rulemaking, we are proposing similar appearance and
placement requirements for the E15 labels that were required for the
diesel sulfur program labels. We propose that the titles of the labels
(e.g., E15) must be 24-point, white, bold Arial font, the ``CAUTION!''
text should also be red, uppercase 16-point bold type, the text in the
labels which describes the ethanol content of the fuel must be 20-point
type and that all other required language in the labels must be 14-
point black, Arial font. We propose that the word ``prohibits'' be in
14 point, black, bold, italic, Arial font. All text should be centered
with the arrangement and spacing of the text consistent with the
illustration. We further propose that the label be 3.625'' width by
3.125'' height and that the background for the area which includes
``CAUTION!'', the title (i.e. ``E15''), and the ethanol content (i.e.,
``15% Ethanol Maximum) shall be 1-inch wide and neon-orange in color,
except that a rectangular white background large enough to encompass
``CAUTION!'' shall be superimposed on this neon-orange background.
While we believe it is important to propose these specific label
appearance requirements to aid in consumer recognition and avoid
unnecessary burden on retailers in developing their own designs, we
also recognize that there is a great deal of variation in the design of
fuel pumps and dispensers throughout the nation. Consequently, we not
only seek comment on all visual aspects of our proposed label, but also
suggest that if changes are deemed necessary, regulated and other
interested parties work together to provide us with a consensus
recommendation in their comments, if possible.
    In addition to content and appearance, the placement of the label
on the pump is also of concern given the limited space available on the
fuel pump itself. In the diesel sulfur program

we required that labels must be placed on the vertical surface of each
pump housing and on each side that has gallon and price meters and that
labels be on the upper two-thirds of the pump in a location where they
are clearly visible (see 40 CFR 80.570(d)). We propose the same
placement requirements for the E15 labels. However, since most States
require labels for gasoline blended with ethanol and the Federal Trade
Commission (FTC) requires labels specifying minimum octane levels
across grades of gasoline, the addition of the proposed E15 label may
impact placement of other labels required by State or Federal law.
Furthermore, FTC has proposed a mid-level ethanol gasoline-blend label
(described below) in addition to its octane label which may further
confuse consumers and make E15 label placement difficult. The Agency
seeks comment on the proposed placement of the E15 label in order to
most effectively mitigate misfueling, while at the same time avoid
interference with other labels on the pumps.
2. Additional Fuel Pump Labeling Requirements
    In addition to the E15 label proposed above, the Agency is seeking
comment on three additional fuel pump labels that would provide
consistent labeling across all gasoline fuel pumps. First, the Agency
seeks comment on requiring a label on gasoline dispensing fuel pumps
that are dispensing fuels which contain ethanol in concentrations up to
10 vol% (``E10 label'').\13\ We further seek comment on whether E10
labels should be required at a retail station only if and when E15 is
made available for sale at a particular retail station. Such an E10
label would have similar appearance and location requirements to the
E15 label and the required label language would follow a similar form
to that of the E15 label so as to standardize labels for consumers.
---------------------------------------------------------------------------

    \13\ If the fuel contains no ethanol, it could be labeled as
such.
---------------------------------------------------------------------------

    The purpose of such a label would be to enhance the effectiveness
of the E15 label to protect against consumer misfueling and the
associated emissions impacts. Without such labels, consumers may be
confused regarding whether an unlabeled pump was appropriate for their
vehicle or engine, undercutting the effectiveness and confidence in the
E15 label. This approach is consistent with the labeling requirements
we used in the diesel sulfur program where we required the use of
labels specifying which type of diesel fuel (low-sulfur diesel, ultra-
low sulfur diesel, etc.) was being dispensed from each pump dispensing
diesel fuel.
    However, since increasing the number of labels will increase the
total cost to retail stations by requiring that all gasoline dispensing
fuel pumps at a station be labeled, we seek comment on the
appropriateness of such a requirement. The Agency seeks comment on the
following E10 label language:

    E10
    (Contains up to 10% Ethanol)
    For use in all gasoline vehicles and engines.

    The Agency also seeks comment on requiring a label on pumps
distributing E85 fuel. E85 is fuel that contains up to 85 vol% ethanol
and at least 15 vol% gasoline, used by flex fuel vehicles (FFVs).\14\
As we noted in the RFS2 NPRM, fuel retailers expressed concern that if
E85 were priced low enough to encourage FFV owners to fuel on it more
frequently, then owners of non-FFVs would also be enticed to misfuel on
it (see 74 FR 24977). This could cause the vehicles and equipment to
operate very poorly, increasing emissions, as well as cause potential
long-term damage and long-term emissions increases. We believe that in
most cases fuel pump labels warning that the use of E85 in non-flex
fuel vehicles is illegal, can damage the vehicle, and can void vehicle
manufacturer warranties may be a sufficient disincentive to mitigate
intentional misfueling. Non-FFVs and nonroad products were not designed
for operation on E85 and may experience serious emissions increases,
operability, and driveability issues, particularly with prolonged use
(e.g. accelerated catalyst deterioration, fuel system component
failures, etc.).
---------------------------------------------------------------------------

    \14\ FFVs are vehicles or engines that are designed to run on
gasoline or gasoline-ethanol blends up to E85.
---------------------------------------------------------------------------

    Such an E85 label would have similar appearance and location
requirements to the E15 label (discussed above) and the required label
language would follow a similar form to that of the E15 label. The
Agency seeks comment on the following E85 label language:

E85
    (Contains up to 85% Ethanol)
    For use in flex-fuel vehicles only.
    WARNING
    Federal law prohibits use in all other vehicles and engines.
    May damage these vehicles and engines.

We request comment on whether the proposed labeling requirements would
provide sufficient warning to consumers not to refuel non-flex-fuel
vehicles with E85. Additionally the Agency seeks comment on the label
language for the E85 label.
    The Agency also seeks comment on requiring labels for so-called
blender pumps. Blender pumps allow station owners to blend E85 and
gasoline in their storage tanks to create intermediate gasoline-ethanol
blends. This allows either station owners or potentially FFV drivers to
choose which gasoline-ethanol blend they prefer, based on operating
characteristics and price. During both the RFS2 and E15 waiver request
comment periods, the Agency received several comments asking us to
require labeling provisions for blender pumps to address misfueling.
Similar to E85, consumers may misfuel their non-FFVs and engines on
ethanol blends greater than 10% (greater than 15% for 2007 and newer
light-duty motor vehicles) due to possible price differences between
intermediate ethanol blends and gasoline. Non-FFVs and nonroad products
were not designed for operation on such high levels of ethanol and may
experience serious emission, operability, and driveability issues,
particularly with prolonged use (e.g. accelerated catalyst
deterioration, fuel system component failures, etc.).
    Such a blender pump label would have similar appearance and
location requirements to the E15 label (discussed above) and the
required label language would follow a similar form to that of the E15
label. The Agency seeks comment on the following two blender pump label
language options. The first option's language addresses a situation
where a vehicle operator can ``dial'' their own gasoline-ethanol blend
level.

E15-E85
    (Contains between 15% and 85% ethanol)
    For use in flex-fuel vehicles.
    WARNING
    Federal law prohibits use in all other vehicles and engines.
    May damage these vehicles.

    The second option's language is to provide for a specific blend of
higher than 15 vol% ethanol content within this range, in which case
the station owner would replace the option 1's language with the
specific value. The language for option 2 would be as follows:

EXX
    (Contains up to XX% Ethanol)
    For use in flex-fuel vehicles.
    WARNING
    Federal law prohibits use in all other vehicles and engines
    May damage these vehicles and engines.

On this label, ``XX'' is the exact maximum ethanol content a fuel
dispensed from a particular blender

pump setting is expected to dispense that is greater than 15 vol%
ethanol.
    The blender pump labels would not need to specify blends containing
between 10 and 15% ethanol because any such fuel pumps would be
required to display the E15 label. However, since a blender pump may
dispense several intermediate ethanol blends (e.g. E20, E30, E40,
etc.), the label should specify a range of ethanol content from E15
through E85. Therefore, under this second option the blender pump would
have multiple labels for each of the blends that the pump dispenses.
3. Stakeholder Labeling Suggestions
    In anticipation of this proposal, EPA met with several stakeholders
to discuss the potential label language used for the E15 label
language. To date, the Agency has received label language suggestions
from Growth Energy.\15\ AllSAFE and the American Petroleum Institute
provided EPA with their public comments to the FTC labeling
proposal.\16\ Copies of these labeling recommendations may be viewed in
the docket.\17\ We have considered the suggestions in these comments
for our proposal, but nevertheless seek comment on whether and if so
how to modify our label proposals based on these and other suggestions.
---------------------------------------------------------------------------

    \15\ Buis, T. Letter to Karl Simon. 4 April 2010. See Docket ID
No. EPA-HQ-OAR-2010-0448.
    \16\ See Docket ID No. EPA-HQ-OAR-2010-0448.
    \17\ Federal Trade Commission, `` 335; FTC File No.
R811005; 16 CFR Part 306: The Federal Trade Commission Rule For
Automotive Fuel Ratings, Certification and Posting: Notice of
Proposed Rulemaking and Request for Comments.'' September 2010.
Available at http://www.ftc.gov/os/comments/fuelratingnprm/
index.shtm.
---------------------------------------------------------------------------

4. FTC Labeling Proposal
    On February 26, 2010, the Federal Trade Commission (FTC) issued a
proposed rulemaking that proposes explicit requirements for gasoline-
ethanol blends that contain more than 10 vol% ethanol and less than 70
vol% ethanol (``Mid-Level Ethanol blends'') (see 75 FR 12470). Since
the FTC labeling proposal did not contemplate the granting of a waiver
for E15, it would have to be modified to be consistent with our recent
E15 partial waiver decision. In addition, as discussed above, we
believe it is important that the label contain certain components and
language necessary to both inform and warn the consumer that are not
fully captured in the FTC labels.
    Therefore, EPA is working with FTC to develop coordinated labeling
requirements and seeks comment on how best to achieve this outcome.
Preferably, one label would be developed that meets EPA and FTC
labeling requirements, since imposing separate labeling requirements
may confuse consumers and would ultimately limit the effectiveness of
labeling to mitigate misfueling. Requiring two separate labels would
also create issues concerning the placement of the E15 label and may
impose an unnecessary burden on retail stations. Finally, we also
believe that to ensure the effectiveness of all gasoline pump labels,
it is important that they be of similar type and format (i.e. those for
E10, E15, E85, and blender pumps).
5. Labeling Requirements and Liability for Misfueling
    It is important to note that compliance with the labeling
requirements specified in this rule does not protect responsible
parties from liability for misfueling. Today's regulations not only
impose labeling requirements but also a prohibition of the sale or
offer for sale of E15 for use in unapproved engines, vehicles, and
equipment (see section III.G below). Compliance with the labeling
requirement does not ensure that the responsible parties have not made
prohibited sales. In addition, our regulations do not address issues of
common law or contract liability between private parties.

B. Product Transfer Document Requirements

    Product transfer documents (PTDs) are customarily generated and
used in the course of business and are familiar to parties who transfer
or receive blendstocks, base gasoline for oxygenate blending and
oxygenated gasoline. In addition, EPA has historically put in place
certain requirements for PTDs for reformulated gasoline blends and
blendstocks to help ensure downstream compliance with our fuel
standards. The introduction of E15 into the marketplace results in the
need for additional information on the PTDs that accompany the transfer
of gasoline and the base gasoline/gasoline blendstocks used for
oxygenate blending, both for reformulated gasoline and conventional
gasoline. The type of additional information needed is different
upstream versus downstream of the point of ethanol addition. We believe
that the additions discussed below to existing PTDs are necessary to
minimize misfueling, to help ensure downstream compliance with our fuel
standards, and thereby to support the introduction of E15.
1. PTD Requirements Downstream of the Point of Ethanol Addition
    Downstream of the point where ethanol blending takes place,
information on the maximum ethanol concentration in the ethanol blend
is needed to help ensure that fuel shipments are delivered into the
appropriate storage tanks at retail and fleet fueling facilities.\18\
Information on the maximum Reid Vapor Pressure (RVP) of E0, E10 and E15
blends is needed on PTDs to help ensure that the fuel is compliant with
the applicable summertime RVP requirements. The RVP reported on the PTD
for E10 and E15 blends could be based on the intended RVP that the
manufacturer of the blendstock for oxygenate blending designed for as
identified on the PTD for the blendstock.\19\ Therefore, RVP testing
after the addition of ethanol would not be necessary to provide the
information on RVP that would be required on the PTD.
---------------------------------------------------------------------------

    \18\ Currently, ethanol blending typically takes place at the
terminal. Evaluations are underway which may facilitate the shipment
of ethanol-gasoline blends by pipeline to terminals. Hence, although
the proposed PTD requirements regarding maximum ethanol content
currently would typically apply to parties downstream of the
terminal, parties upstream of the terminal may need to include
information on maximum ethanol concentration on product PTDs in the
future.
    \19\ This is dependent on the proper amount of ethanol being
added to the blendstock, and on the product being segregated from
all products with a different RVP.
---------------------------------------------------------------------------

    We are proposing that the following statements would be included on
the PTDs for the various fuel blends:

For E0: ``E0: Contains no ethanol.
    The RVP does not exceed [Fill in appropriate value]''
For E10: ``E10: Contains between 9 and 10 volume percent ethanol
    The RVP does not exceed [Fill in appropriate value]''
For E15: ``E15: Contains up to 15 volume percent ethanol
    The RVP does not exceed [Fill in appropriate value]''
For EXX: ``EXX--Contains up to XX% ethanol.

    ``EXX'' refers to fuels blends above E15 up to and including E85
and fuel blends below 9 volume percent ethanol. The maximum potential
ethanol content of the fuel would be required to be specified on the
PTD in the place of ``XX''.
    We request comment on whether additional language on E10 PTDs is
needed to inform parties that a blend containing between 9 and 10
volume percent ethanol which benefits from the 1 psi RVP waiver may not
be commingled with an E0 or E15 blend.\20\ We request comment on
whether any other additional information should be

provided on the PTDs for ethanol fuel blends.
---------------------------------------------------------------------------

    \20\ Such as, ``Designed for the special RVP provisions for
ethanol blends. Do not blend with gasoline containing less than 9
vol% ethanol or E15.''
---------------------------------------------------------------------------

2. PTD Requirements Up to and Including the Point of Ethanol Addition
    Upstream of the point where E10 and E15 blends are manufactured,
information is needed on the PTDs for base gasoline or gasoline
blendstock used for oxygenate blending (BOB) \21\ to facilitate ethanol
blender compliance with the applicable EPA summertime RVP
requirements.\22\ This information would need to include the maximum
potential RVP of the BOB and the maximum ethanol concentration that may
be added to the BOB.
---------------------------------------------------------------------------

    \21\ For purposes of this discussion, the blendstock or base
gasoline (BOB) is typically referring to the fungible base gasoline
produced at a refinery for the specific intention of adding ethanol.
The fungible gasoline produced for this purpose is subject to all of
the 40 CFR parts 79 and 80 regulations applicable to gasoline.
However, under 40 CFR 80.101(d)(4), a refiner with direct control of
the ethanol addition to the actual gasoline produced by that refiner
may consider the final fuel including the ethanol when complying
with part 79 and 80 regulations.
    \22\ See section IV of this preamble for a discussion of the RVP
requirements for E15 and E10.
---------------------------------------------------------------------------

    To satisfy these needs, we are proposing that PTDs for BOBs for use
in the manufacture of ethanol blends that are subject to summertime RVP
controls include the maximum RVP of the BOB. We are also proposing that
such PTDs in non-RFG areas indicate what ethanol concentration is
suitable to be blended with the BOB. The RFG requirements found at 40
CFR 80.77 already contain requirements that PTDs indicate what
oxygenate and oxygenate amount are suitable to be blended with the
reformulated blendstocks for oxygenate blending (RBOBs).
    We are proposing that the following statements would be included on
the PTDs for BOBs in non-RFG areas:

    ``Suitable for blending with ethanol at a concentration up to 15
volume % ethanol'' or, in the case of a BOB designed to take
advantage of the 1psi allowance for E10 in 40 CFR 80.27(d)(2):
    ``Designed for the special RVP provisions for ethanol blends
that contain between 9 and 10 volume % ethanol''
    ``The RVP of this blendstock/base gasoline for oxygenate
blending does not exceed [Fill in appropriate value]''

    As we are proposing and seeking comment on blendstock commingling
prohibitions in addition to those already in place for RFG (see section
III.D.) we also request comment on whether additional information is
needed on the PTDs for BOBs to help ensure that these blending
restrictions are observed. We request comment on whether the following
language should be added to the PTD for a BOB designed to take
advantage of the 1psi allowance for E10 in order to help prevent
downstream violations of the RVP standards: ``The use of this gasoline
to manufacture a gasoline-ethanol blend with less than 9 vol% ethanol
or E15 may cause an RVP violation.'' We request comment on whether any
additional information should be provided on the PTDs for BOBs.
3. General PTD Requirements
    We are proposing that on each occasion when any person transfers
custody and/or ownership of any gasoline or base gasoline/gasoline
blendstock used for oxygenate blending, the transferor would be
required to provide the transferee with an appropriate PTD identifying
the gasoline/blendstock/base gasoline and its characteristics (as
defined below), as well as such general information as the names and
addresses of the transferor and transferee, the volume of product being
transferred, the location of the product on the date of transfer, and
specific information described in this preamble. We are proposing that
all parties would be required to retain PTDs for a period of not less
than five years and would be required to provide them to EPA upon
request. Five years is the normal record retention requirement for 40
CFR part 80 fuels programs, such as the reformulated gasoline (RFG)
program.
    We are proposing that PTDs would be required to be used by all
parties in the distribution chain down to the point where the product
is sold, dispensed, or otherwise made available to the ultimate
consumer. We are proposing that product codes could be used to convey
the information required as long as the codes are clearly understood by
each transferee. However, we believe that product codes alone would not
be sufficient for transfers to truck carriers, retailers, or wholesale-
purchaser consumers. Hence, we are proposing that the full proposed
text would need to be included on the PTD for transfers to truck
carriers, retailers, or wholesale-purchaser consumers.
    Parties would be afforded significant freedom with regard to the
form PTDs take under this proposal, although we are proposing that the
PTDs would be required to travel in some manner (paper or
electronically) with the volume of blendstock or fuel being
transferred. The addition of the proposed information to PTDs would not
require any additional testing of fuel composition. Adoption of these
proposed changes would add a one-time burden to program and implement
new product codes and statements, as well as a continuing small burden
associated with using product codes and statements on PTDs. Given this
and the fact that PTDs are used in the course of business, we believe
that the proposed new PTD requirements could be readily accommodated by
industry. The increased burden which would result from the adoption of
these proposed PTD requirements is detailed in section IX.B. of this
preamble.

C. Retail Fuel Dispenser Label and Fuel Ethanol Content Survey

    To help mitigate the potential for misfueling, oversight of fuel
retailer compliance with the proposed E15 labeling requirements and of
the actual ethanol content of the dispensed fuel in comparison to the
information on the label is needed. To provide adequate oversight, EPA
conditioned the E15 partial waiver on a requirement that ethanol
blenders, ethanol producers, ethanol importers, petroleum refiners, and
petroleum importers participate in a survey of compliance at fuel
retail facilities.\23\ The E15 partial waiver decision specified that
an EPA-approved survey plan is to be in place prior to introduction of
E15 to the marketplace and that the results of the survey must be
provided to EPA for use in its enforcement and compliance assurance
activities.
---------------------------------------------------------------------------

    \23\  See Partial Grant and Partial Denial of Clean Air Act
Waiver Application Submitted by Growth Energy to Increase the
Allowable Ethanol Content of Gasoline to 15 Percent; Decision of the
Administrator elsewhere in this issue of the Federal Register.
---------------------------------------------------------------------------

    Today's notice contains our proposal on requiring a survey as part
of a misfueling mitigation program. This proposal covers how the
required survey should be formulated and conducted. As discussed in
section III.G., we are proposing that the survey could be used to meet
the periodic sampling and testing elements of a regulated party's
affirmative defenses to presumptive liability in cases where instances
of noncompliance with the applicable maximum ethanol content
specification are discovered. Should EPA finalize the additional
labeling requirements that we requested comment on in section III.A.2.
of this proposal, evaluation of retailer compliance with these labeling
requirements would also be included in the survey. Regardless of
whether we finalize labeling provisions, testing on the ethanol content
of the fuel delivered from all non-FFV dispensers would need to be
included in the survey to help mitigate misfueling.
    The survey requirements that we are proposing are based on an
existing

survey of compliance with the EPA labeling requirements for retail
diesel fuel dispensers, and with the maximum allowable sulfur content
of the diesel fuel delivered from these dispensers under EPA's ULSD
program. EPA recently codified the requirements for this diesel fuel
survey in a direct final rule that became effective on July 12,
2010.\24\ The reformulated gasoline (RFG) program also utilizes a
compliance survey program to ensure seasonal RFG area requirements are
met for predicted emissions performance based on average area fuel
parameters. Based on the ULSD and RFG programs, we are proposing two
options for obligated parties to satisfy the survey requirement. Survey
Option 1 allows individual obligated parties to elect to individually
survey gasoline and retail stations anywhere their fuel might be sold.
Survey Option 2 allows obligated parties to form a consortium that
contracts an independent survey association to conduct a national
ethanol content and E15 labeling survey.
---------------------------------------------------------------------------

    \24\ Alternative Affirmative Defense Requirements for Ultra-Low
Sulfur Diesel and Gasoline Benzene Technical Amendment, 75 FR 26121,
May 11, 2010.
---------------------------------------------------------------------------

    For Survey Option 1, we propose that obligated parties choosing the
individual survey option must survey labels and ethanol content at
retail stations wherever their gasoline may be distributed if it may be
blended as E15. Prior to conducting such a survey a survey plan would
have to be approved by EPA. We seek comment on all aspects related to
Survey Option 1.
    For Survey Option 2, we propose that the survey would consist of a
nationwide program of sampling and testing designed to provide
oversight of all retail stations that sell gasoline. Details of the
proposed survey requirements are similar to those included in the ULSD
and RFG programs. We propose that the survey organization would be
required to submit survey plans on an annual basis that would be
applicable from January 1 through December 31. We propose that EPA
would review the first survey plan within two months of its receipt. We
propose that the survey organization would be required to submit
subsequent survey plans to EPA for approval by November 1 of the year
proceeding the calendar year in which the sampling and testing program
would be implemented. The Agency also proposes that proof that the
amount of money necessary has been paid to the surveyor is sent to EPA
no later than December 15 of the year proceeding the calendar year in
which the sampling and testing program would be implemented. For the
first annual survey, we propose that proof of payment be submitted to
the Agency no later than one month before the sampling and testing
program would be implemented. We seek comment on the deadlines for both
the survey plan and proof of payment for the survey for the first
survey and on subsequent surveys.
    We propose that the sampling and testing program would ensure
comprehensive geographic coverage nationally representative of gasoline
sold at retail outlets by providing proportionate coverage of gasoline
across three sampling strata. These three strata generally refer to:
(1) Densely populated areas, which include Metropolitan Statistical
Areas and the reformulated gasoline control areas; (2) transportation
corridors, which are based on interstate highways outside the densely
populated areas;\25\ and (3) rural areas, which include all areas not
included in the previous two strata. These areas would be subdivided
into clusters, generally based on groupings of counties. The specific
criteria used for selecting sampling areas for each survey plan would
be subject to EPA approval. We seek comment on all aspects of the
proposed elements that a survey plan should include.
---------------------------------------------------------------------------

    \25\ Transportation corridors would include areas immediately
adjacent to the highways themselves and a swath within several miles
on each side of the highway. For any given survey, a certain length
of any specific highway might be deemed appropriate as a sampling
unit or cluster.
---------------------------------------------------------------------------

    Comment is specifically requested on the criteria which should be
used to determine the minimum sample size for the survey. The sampling
and testing program would need to both accurately estimate the
proportion of retail stations that are non-compliant with E15 labeling
and ethanol content requirements and provide a credible deterrent to
deliberate or inadvertent violations of downstream enforcement
standards. For the ULSD survey program, we require a minimum of 5,250
samples annually. For a national survey looking at all gasoline retail
stations, we believe the minimum number of samples needs to be greater
because there are more than three times the number of retail stations
that sell gasoline compared with stations that sell diesel. We propose
that the survey take a minimum of 7,500 samples spread across four
quarterly surveys. We also propose a sample size equation similar to
the one used to determine sample sizes for the ULSD survey program (see
equation in the proposed regulations at 80.1502(b)(4)(v)(A)). This
equation bases sample size on the proportion of retail stations that
are non-compliant. We seek comment on both the minimum number of
samples and the method for determining samples sizes.
    Since initially E15 may be introduced into commerce in a limited
geographical area, it may not be necessary to carry out the full survey
or to carry it out nationwide. One way to potentially resolve this
issue would be to limit the areas required to be surveyed to areas that
are known to have E15 being distributed. Unfortunately, there are no
reliable real-time data that show when E15 is first introduced into an
area and it could take awhile for the proposed annual survey program to
incorporate these new geographic areas. Additionally, the borders of
such areas are difficult to define and constantly shift in response to
market forces. This approach also undermines one of the stated purposes
of the survey program, namely that the survey program helps deter
either intentional or unintentional violations by increasing the
likelihood of violators being randomly caught. If EPA allows only
certain areas to be surveyed while excluding others, some parties may
manufacturer, blend, or distribute E15 without properly identifying the
fuel as E15 or properly labeling the fuel dispenser as dispensing E15.
By the time the survey program caught up, motor vehicles and nonroad
products not approved for E15 use may have been misfueled for a long
time. On the other hand, if there were ways to properly identify areas
that are distributing E15 real time, then limiting the survey to only
those areas could considerably reduce the cost of compliance with the
proposed survey requirements. The Agency seeks comment on ways to
possibly limit surveys to only those areas that have E15 being
introduced into commerce.
    Another option to limit survey requirements would be to require a
national survey, but have a lower minimum sample size that gradually
increases over time. Since the proposed approach for determining sample
sizes above 7,500 discussed above is based on the proportion of retail
stations that are noncompliant with ethanol content and/or E15 labeling
requirements, if there is very little E15 being introduced into the
marketplace, the proportion of noncompliant retail stations would be
small. In this case, 7,500 samples may be substantially higher than the
number of samples required by the proposed method for determining
sample sizes. Since this is most likely to occur at the beginning of
the survey program, the survey program could gradually increase the
annual minimum sample

size to reduce the burden to industry. For example, the Agency may only
require a minimum of 2,000 samples the first full survey year (2012),
4,000 samples in 2013, 6,000 samples in 2014, and 7,500 samples in
2015. We seek comment on this gradual minimum sample size approach and
all other issues related to determining the minimum number of samples
for a national ethanol content and E15 labeling survey.
    We also are proposing that the independent survey association would
ship fuel samples on the same day that the sample was collected and
that the sample be analyzed for ethanol content within 24 hours from
the time the samples were acquired. Although having such a short
delivery time for fuel samples to be analyzed may increase costs, this
time period is both consistent with other fuel survey programs and
would allow ethanol content and E15 labeling violations found by the
survey to be corrected quickly to mitigate misfueling. We seek comment
on the proposed amount of time allowed for samples to be shipped for
the analysis of ethanol content.
    For both survey options, we require that survey plans would include
a methodology for determining when the survey samples will be
collected, the locations of the retail outlets where the samples will
be collected, the number of samples to be included in the survey,
procedures that would prevent the advance notification of retail
stations, and how individual retail stations will be determined for
sampling. We propose that samples at retail stations be taken from all
gasoline dispensers and have the samples tested for ethanol content and
that retail stations be selected randomly with the probability of
selection proportionate to the volume of gasoline sold at the retail
outlet. We also propose that ethanol content be measured in accordance
with a test method that meets the requirement of 40 CFR 80.46(g). We
seek comment on these requirements for survey plans and whether any
additional requirements are necessary. We also seek comment on all
matters related to the national ethanol content and E15 labeling survey
proposed today.

D. Program Outreach

    Effective outreach to consumers and stakeholders is often essential
to the successful implementation of environmental protection programs.
To implement the RFS program, for example, EPA provides training
seminars for stakeholders and manages dedicated telephone and e-mail
support lines. Various industry representatives and organizations
provided program information and coordination to their members and
customers as well as to facilitate the introduction of new program
requirements this past July.
    In the case of E15, outreach to consumers and stakeholders may be
critical to help mitigate misfueling incidents that can result in
increased emissions or vehicle or engine damage. The potential for E15
misfueling incidents exists because consumers tend to choose the lowest
priced fuel, and E15 may cost less than E10 since ethanol currently
tends to be less expensive than gasoline.
    A recent example of successful outreach to consumers and
stakeholders is the coordinated work done in support of the ULSD
program. ULSD was a new fuel with the possibility of consumer
misfueling that could result in engine damage. With ULSD, the fuel
industry trade association API took the lead in working with
stakeholders to establish the Clean Diesel Fuel Alliance (CDFA), a
collaboration of public and private organizations designed to ensure a
smooth program transition by providing comprehensive information and
technical coordination. The organizations represented in the CDFA
include engine manufacturers, fuel retailers, trucking fleets, DOE and
EPA. CDFA efforts to educate ULSD users include developing technical
guidance and educational information, including a Web site (http://
www.clean-diesel.org), as well as serving as a central point of contact
to address ULSD-related questions.
    The CDFA outreach model could prove beneficial in this case. EPA
anticipates that all parties that may be involved in bringing higher
gasoline-ethanol blends to market would participate in a coordinated
industry-led consumer education and outreach effort. In the context of
this program, potential key participants include ethanol producers,
fuel manufacturers, automobile, engine and equipment manufacturers,
States, non-governmental organizations, parties in the fuel
distribution system, EPA, DOE, and USDA. Potential education and
outreach activities a public/private group could undertake include
serving as a central clearinghouse for technical questions about E15
and its use, promoting best practices to educate consumers or mitigate
misfueling instances, and developing educational materials and making
them available to the public.
    Some stakeholders have also suggested that a Web site be created to
inform consumers of the potential impacts of E15 on older motor
vehicles, heavy-duty gasoline engines and vehicles, motorcycles, and
nonroad products. Stakeholders have further suggested that, if a unique
misfueling Web site is created, then EPA should require the Web site
address to be displayed on the E15 label. EPA seeks comment on the
appropriateness of a unique misfueling Web site and of including such a
Web site address on the E15 label.

E. What other means of mitigating misfueling were considered?

    EPA believes that the proposed misfueling mitigation approach will
effectively and sufficiently mitigate misfueling based on our past
experience. The Agency employed a similar and relevant misfueling
mitigation program when ULSD was introduced in 2006. Retail stations
and wholesale purchaser-consumers were required to have fuel dispenser
labels indicating whether the diesel being dispensed was 500 ppm (low
sulfur diesel or LSD) or 15 ppm (ULSD). MY2007 and newer on-highway
diesel vehicles and engines were required to use ULSD and prohibited
from using LSD. At the beginning of the ULSD program, we were aware of
several instances where consumers, after checking the labels, had
difficulty finding ULSD in some areas. Consumers were informed that
misfueling would result in significant engine damage. We are not aware
of any significant instances when misfueling occurred during this
labeling program. This indicates that EPA outreach and information
provided by the engine manufacturers, Clean Diesel Fuel Alliance, and
other stakeholders, was effective in educating consumers and mitigating
misfueling. Additionally, we feel that product transfer document
requirements and the ULSD survey program were vital in implementing and
enforcing this fuel transition. Based on the success of the ULSD
program, we believe that similar requirements for E15 will be
sufficient and successful.
    Some have argued that the ULSD program example is not applicable in
this case since the MY2007 and newer on-highway diesel vehicles and
engines were at risk from misfueling, whereas for E15, it is primarily
older motor vehicles (i.e., MY2000 and older motor vehicles) that are
at risk. While EPA believes that the potential for engine repair costs
applies in both cases, the Agency also believes that similar misfueling
mitigation measures can be effective for E15 as well. Coupled with an
effective outreach and public education program, the proposed
mitigation measures should deter

misfueling and encourage consumers to pay close attention to the E15
labels. Some have also argued that the ULSD program is not applicable
because the ULSD program focused primarily on commercial truck drivers,
who may be more cognizant of fuel choices due to the potential impact
on their commercial investments, than the general public. We believe
that consumers are also concerned about their private vehicles, and
that the potential costs associated with misfueling (discussed below in
section III.F) will have just as much of an impact in informing
consumer fuel choices. As long as fuel dispensers are properly labeled
and consumers are adequately informed of the associated risks of
misfueling nonroad products and older motor vehicles on E15, we believe
the proposed misfueling mitigation program will be effective.
    While EPA believes that the misfueling mitigation provisions
included in today's proposal will address potential misfueling
concerns, we recognize that these provisions are not the only potential
means for addressing misfueling concerns. EPA has received many
suggestions for mitigating misfueling. For example, API conducted a
scoping study, ``Evaluation of Measures to Mitigate Misfueling of Mid-
to High-Ethanol Blend Fuels at Fuel Dispensing Facilities,'' that
includes many of these suggestions. That study may be found in the
docket.\26\
---------------------------------------------------------------------------

    \26\ American Petroleum Institute, ``Evaluation of Measures to
Mitigate Misfueling of Mid- to High-Ethanol Blend Fuels at Fuel
Dispensing Facilities,'' EPA Docket  EPA-HQ-OAR-2010-0448.
---------------------------------------------------------------------------

    One suggestion in API's study was to have full service attendants
at gas stations that ensure E15 is only used in appropriate motor
vehicles. While such a measure may be effective, its overall
effectiveness is unknown and it would be a large burden on service
stations to employ service attendants for this purpose. This option
would come at an extremely large cost, and there would need to be
significant training of new employees. API estimates the average annual
cost per service station at $67,500 and the annual nationwide cost at
$10.6 billion. Another suggestion was to have separate islands at
service stations, with one for blends at E10 and below, and one for
mid- and high- gasoline-ethanol blends. It was noted that this measure
would also likely cause congestion at the pumps, be inconvenient for
the consumer, reduce the number of pumps available for higher-demand
fuels, and not prevent intentional misfueling. API estimates the cost
of separate islands at $700 per station and $40 million nationwide,
though they did not cost out the consumer implications.
    Another option discussed is a measure in which keypads or
touchscreens would be made available at each pump to allow consumers to
input data about their motor vehicle or simply answer ``yes'' or ``no''
to the question of whether their motor vehicle is an FFV or non-FFV. If
the motor vehicle is appropriate for the fuel, then the pump would
allow fueling. If existing dispensers do not already have display
screens, this strategy would require retail stations to install keypads
or touchscreens at an approximate cost of $5,000 for dispensers that
may be retrofitted, with the cost prohibitive for dispensers that may
not be retrofitted. There may also be an additional cost per station of
$10,000--$20,000 to install a central controller to accept motor
vehicle information. Such a strategy may cause some congestion at the
pumps. Intentional misfueling would not be prevented through such
measure.
    Also discussed in the report was a strategy in which retail
stations would have a video or audio presentation play when a mid- to
high- gasoline-ethanol blend pump is lifted from the dispenser. The
presentation would provide information to the consumer about E10+,
which motor vehicles may fuel with it, and why other motor vehicles
should not. Optionally, the consumer could be required to confirm
fueling with E10+ at the end of the presentation. The cost of such an
alternative for those stations without display screens, is estimated to
be $5,000; if the existing dispenser could not be retrofitted with a
display screen, there would be additional and considerable costs
incurred for replacing a dispenser. Costs for this option could be as
high as $20,000 per station.
    API also suggested that a different colored hand warmer or a
different type of nozzle grip for fuel pumps with E15+ may help alert
consumers to the new type of fuel without a large burden on retail
stations. Hand nozzles for E15+ would be a different color than for
other gasoline types, or would have a different texture from other hand
grips. To be effective, one color or one type of grip should be used
for E15+ on a national basis. Consumers would know by the color and/or
texture that those pumps were for E15+. Some concerns about this option
are that it would not be possible to distinguish nozzles that dispense
both E10 and E15, some consumers may not notice the warmer or grip, and
this would not prevent intentional misfueling. However, API believes
that nozzle grips with different textures would be noticeable to most
consumers, even those who do not read the pump labels. Also, hand
nozzle grips are easy to install and replace as needed. API has
estimated the cost at $5 to $11 per nozzle with a national cost of
$800,000 to $1.6 million.
    While many of the strategies discussed in the API study may be
effective in communicating with the consumer about E15, EPA believes
that the combination of pump labels, regulatory prohibition on
misfueling, PTDs, a survey, and consumer outreach will adequately
mitigate misfueling by consumers. The labels on the fuel pumps will
notify consumers that the pump is for E15 and only certain MY motor
vehicles should use that fuel. Consumer outreach will give the consumer
more in-depth information, such as why older MY motor vehicles, heavy-
duty gasoline engines and vehicles, motorcycles, and nonroad products
should not fuel with E15 and what damage may occur from misfueling. The
PTDs will help ensure that E15 is identified as such through the
distribution chain, which will help prevent inadvertent mislabeling of
fuel. Finally, a survey will identify where mislabeling (or no
labeling) of E15 has occurred so that appropriate labels are used.
    Other options that have been suggested may be too expensive,
difficult to implement, and/or otherwise not likely acceptable to
consumers. As such, EPA does not deem it appropriate to include these
options in today's proposal. We seek comment on any other measures not
proposed in the rule that the regulated industries and other interested
parties feel may be necessary to mitigate misfueling. We seek comment
on any other cost-effective mitigation measures that may be
appropriate. If EPA considers requiring any other mitigation measures
that are suggested by commenters in the final rule, EPA will conduct
appropriate analyses of such measures, including the impacts on small
businesses, before deciding whether to include such mitigation measures
in the final rule.

F. Cost of Compliance

    The cost of compliance with the provisions being proposed today
include the periodic capital costs of labeling fuel dispensers, the
onetime costs of the PTD requirements, and the annual cost of the
survey requirements. The cost of the proposed labeling requirements is
estimated at $1.04 million per year on an annualized basis. The cost of
the proposed PTD

requirements is estimated at $0.56 million per year on an annualized
basis. The cost of the proposed survey requirements is estimated at
$2.05 million per year. The total cost of all of the proposed
requirements is estimated at $3.65 million per year. These estimated
costs are detailed in the following sections. As discussed in section
III.F.4, we believe that these costs will be more than offset by the
avoided costs of repairing engines/vehicles that could otherwise have
been damaged by misfueling in the absence of the implementation of the
proposed requirements.
1. Labeling Costs
    Our estimate of the cost of the proposed E15 fuel dispenser
labeling requirement includes the cost to the fuel retailer of
purchasing the label, the administrative cost to ensure that all
gasoline dispensers are labeled appropriately, and the labor cost to
replace fuel dispenser labels. Based on our past experience with
labeling programs, the RFS2 NPRM and industry input, the cost of an E15
label is estimated to be $5.00 per label.\27\ There are approximately
162,000 retail gas stations in the U.S. according to National Petroleum
News.\28\ The RFS2 Final RIA estimates that there is an average of 7.7
gasoline refueling positions per retail station.\29\ Thus, for a retail
facility that has 8 refueling positions, the total cost if all of the
dispenser labels are replaced would be $40.00. A number of fuel
retailers are small businesses. However, we believe that the minor cost
of label replacement would not represent a significant additional
burden to any fuel retailer. Specifically, making the conservative
assumption that there will be the maximum number of pumps (8) even for
small stations and assuming an 8 year life before labels need to be
replaced, the annualized cost to a service station is $5 per year. The
amount of gasoline sold at a small service station is estimated to be
approximately 60,000 gallons/month.\30\ Assuming an average cost of
gasoline at $2.31/gal (per the EIA 2009 national average regular grade
gasoline price) the annual revenue for a small service station from its
gasoline sales is approximately $1.7 million.\31\ Thus, the cost of the
labels represents less than 0.001% of the total annual revenue of a
small gas station from its gasoline sales.\32\
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    \27\ RFS2 NPRM RIA page 581 (EPA-420-D-09-001; May, 2009);
available at: http://www.epa.gov/otaq/renewablefuels/420d09001.pdf).
    \28\ National Petroleum News, ``2008 marketfacts'', states that
there were 161,768 gasoline retail facilities in 2008 http://
www.npnweb.com.
    \29\ RFS2 Final RIA, page 232 (EPA-420-R-10-006; February 2010);
available at: http://www.epa.gov/otaq/renewablefuels/420r10006.pdf).
    \30\ The National Association of Convenience Stores (NACS) 2006
State of the Industry Report states that for motor fuel retail
stations that sell less than 75,000 gallons of all motor fuels, the
average monthly throughput is 57,778 gallons.
    \31\ Energy Information Administration (EIA) annual national
average gasoline price data http://www.eia.gov/dnav/pet/pet_pri_
gnd_dcus_nus_a.htm.
    \32\ See section IX.D. of this notice for additional discussion
of potential impacts from today's proposal on small businesses.
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    Although we are requesting comment on whether all gasoline fuel
dispensers should be labeled,\33\ today's notice only includes proposed
labeling requirements for E15 fuel dispensers. Nevertheless, we are
assuming all gasoline refueling positions would be relabeled for the
purposes of estimating the costs of this proposal. This approach
provides a conservatively high estimate of costs if only the proposed
E15 labeling requirements are finalized. By multiplying the average
number of gasoline refueling positions per retail facility, by the
number of fuel retailers, and the cost per label, we arrived at an
estimated cost of $6.23 million to replace all of the labels at
gasoline refueling positions at all fuel retailers in the U.S. We
assumed an 8 year label life before it needs to be replaced. Amortizing
the periodic labeling costs using a 7% cost of capital, we estimate the
annualized cost to comply with the proposed labeling provisions to be
approximately $1.04 million per year. We request comments on these
estimated costs.
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    \33\ Including E0, E10, E15, EXX, and E85 fuel dispensers. See
section III.A. of this notice.
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2. PTD Costs
    Section IX.B. of today's preamble contains a discussion of the
costs of the PTD requirements proposed in today's notice.\34\ There
would be a one-time cost of $5.1 million to regulated parties to modify
the formatting of their existing PTDs to accommodate the new
information which would be required as a result of the implementation
of today's proposal. After the one-time modification of PTD formatting
is complete, we believe that there would be no significant additional
costs associated with communicating the additional information that
would be required by today's proposal to downstream parties in the
distribution system (either in electronic or paper form). By amortizing
the one-time reformatting costs over a period of 15 years at a 7% cost
of capital, we arrive at an annualized cost of $560,000 for the
proposed PTD requirements. We request comment on these estimated costs.
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    \34\ Section III.B. contains a discussion of the proposed PTD
requirements.
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3. Survey Costs
    The estimated costs of the proposed ethanol content and labeling
survey are based on experience with the existing RFG and ULSD surveys
and discussions with industry. The RFG survey includes all of the
elements required in the proposed nationwide survey except the survey
of compliance with the proposed labeling requirements. We estimate that
the cost of adding the proposed survey of compliance with the proposed
labeling requirements to the existing RFG survey at $50,000 per year.
The cost to implement all of the proposed survey provisions for
conventional gasoline is estimated at $2 million per year. Thus, the
total cost of the proposed survey requirements is estimated to be $2.05
million per year.\35\ We request comments on this estimate.
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    \35\ See section III.C. for a discussion of the proposed survey
provisions.
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4. Avoided Motor Vehicle and Nonroad Product Repair Costs
    We believe that proposed labeling and associated survey and PTD
provisions will be an effective tool at mitigating unintentional
misfueling based on our experience with other labeling provisions (such
as ULSD). The resulting prevention of misfueling will not only minimize
the potential emission increases that could result (as discussed in
section VI.I.), but also avoid potentially costly highway motor
vehicle, heavy-duty gasoline engines and vehicles, motorcycles, and
nonroad product repairs that would be anticipated to far exceed the
cost of the labels. For example, based on a poll of automobile repair
facilities, fuel pump and catalyst replacements average $427 and
$1,250, respectively. Similarly, for nonroad equipment, the cost for a
fuel line repair of handheld equipment (e.g. trimmers, chainsaws) or
non-handheld equipment (e.g. lawnmowers, generators) could cost $100-
$400 (based on information received from repair facilities in Ann
Arbor, Michigan and vicinity) and replacing this same equipment can
range from $100 (consumer handheld) to $5,000 (commercial grade garden
tractor) should the engine fail.\36\ While there are no data to
estimate the frequency at which these repairs or other potential
complications (discussed in section VI) associated with misfueling on
E15 might

occur, even if these potential complications were avoided on a tiny
fraction of MY2000 and older motor vehicles and nonroad products as a
result of the regulations (as opposed to actions taken independently by
industry in response to conditions on the partial waiver), the savings
would still far exceed the costs of compliance. We request comment on
this assessment.
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    \36\ While this analysis is focused on small SI engines, note
that other nonroad equipment/vehicle categories can incur higher
expenses due to the higher complexity of the equipment/vehicle
compared to small SI engines.
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G. Compliance and Enforcement

1. What are the prohibited acts?
    There is a long-standing prohibition, under CAA section 211(f)(1),
that fuel manufacturers may not introduce gasoline-ethanol blends
containing greater than 10 vol% ethanol into commerce for use in non-
flex-fuel vehicles. The partial waiver modifies this prohibition so
that gasoline-ethanol blends containing up to 15 vol% ethanol may
legally be introduced into commerce by fuel manufacturers for use in
MY2007 and later light-duty motor vehicles. The waiver does not apply
to any MY heavy-duty gasoline engine or vehicle, motorcycle, or nonroad
product.
    We are proposing that all parties would be prohibited from selling,
introducing into commerce or causing or allowing the sale or
introduction into commerce of gasoline that has an ethanol content
above 10 vol% ethanol into MY 2000 and older light-duty motor vehicles,
any heavy-duty gasoline engine or vehicle, any motorcycle, and any
nonroad product. We are also proposing that fuel distributors who
transport or store a gasoline-ethanol blend, base gasoline or
blendstock for ethanol blending would be prohibited from increasing the
ethanol content to exceed the value noted on the PTD.\37\ Since the
Agency is deferring a decision for MY2001-2006 motor vehicles, we are
not proposing a prohibition for fuel used in these motor vehicles at
this time. DOE testing of MY2001-2006 light-duty motor vehicles is
ongoing and EPA expects to make a waiver determination for these
vehicles shortly after the results of the DOE testing are available. If
EPA does not grant an E15 waiver for MY2001-2006 light-duty motor
vehicles, then we would expect to include the same prohibitions for
these MY motor vehicles in the final rulemaking. Even though we are not
proposing an actual prohibition for motor vehicles MY2001-2006, it is
still unlawful for fuel manufacturers to introduce E15 into commerce
for use in these motor vehicles unless we grant an E15 waiver for these
motor vehicles.
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    \37\ A violation of this prohibition could cause or contribute
to vehicle misfueling downstream.
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    In addition to this general misfueling prohibition, there are
several other prohibited acts that we are proposing in conjunction with
the regulatory provisions being proposed today. We are proposing that
retailers and wholesale purchaser consumers would be prohibited from
dispensing E15 unless they comply with the proposed dispenser labeling
requirements in section III.A. of today's preamble. We are proposing
that ethanol blenders would be prohibited from introducing E15 into
commerce without complying with the proposed ethanol content survey
requirements in section III.C. of today's preamble.
    In addition, there are several RVP related prohibitions that exist
today that may need to be modified in light of E15. There is an
existing prohibition with respect to exceeding applicable summertime
RVP requirements.\38\ We are proposing to prohibit the commingling of
an E10 gasoline-ethanol blend with either E0 or E15 due to potential
concerns about causing a violation of summertime RVP requirements
unless the E10 blend had not taken advantage of the 1 psi RVP waiver.
For the same reasons, prohibitions on the commingling of BOBs is
necessary. Therefore we are proposing certain prohibitions against
commingling conventional gasoline BOBs similar to the prohibitions for
reformulated blendstocks for oxygenate blending (RBOBs) in 40 CFR 80.78
under the RFG program. Specifically, we are proposing to prohibit
commingling an E10 BOB (produced to take advantage of the 1 psi RVP
waiver) with an E15 BOB unless the resulting mixture is designated as
an E10 BOB. We request comment on whether other modifications to these
existing RVP related regulatory requirements are needed as a result of
the introduction of E15.
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    \38\ See 40 CFR 80.27.
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2. What are the proposed liability and penalty provisions for
noncompliance?
    Today's proposed rule contains prohibition and liability provisions
that are similar to those of the other fuels programs in 40 CFR Part
80.\39\ Under the proposed regulation, regulated parties would be
liable for committing certain prohibited acts, such as selling or
distributing gasoline-ethanol blends with an ethanol content that
exceeds the maximum for the intended end-use category of vehicles/
engines, or causing/contributing to others committing prohibited acts.
In addition, parties would be liable for a failure to meet certain
affirmative requirements or causing others to fail to meet their
affirmative requirements. All parties in the fuel distribution system
would be liable for a failure to fulfill the recordkeeping and PTD
requirements.
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    \39\ See section 80.5 (penalties for fuels violations); section
80.23 (liability for lead violations); section 80.28 (liability for
volatility violations); section 80.30 (liability for diesel
violations); section 80.79 (liability for violation of RFG
prohibited acts); section 80.80 (penalties for RFG/CG violations);
section 80.395 (liability for gasoline sulfur violations); section
80.405 (penalties for gasoline sulfur regulations).
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a. Presumptive Liability
    All EPA fuels programs include a presumptive liability scheme for
violations of prohibited acts. Under this approach, liability is
imposed on two types of parties: (1) The party in the fuel distribution
system that controls the facility where the violation was found or has
occurred; and (2) those parties, typically upstream in the fuel
distribution system from the initially listed party (such as any
distributor of the fuel), whose prohibited activities could have caused
the program nonconformity to exist.\40\ This presumptive liability
scheme has worked well in enabling us to enforce our fuels programs
since it creates comprehensive liability for essentially all the
potentially responsible parties. The presumptions of liability may be
rebutted by establishing an affirmative defense.
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    \40\ An additional type of liability, vicarious liability, is
also imposed on branded refiners under these fuels programs.
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    To clarify the inclusive nature of these presumptive liability
schemes, today's proposed rule would explicitly include as prohibitions
causing another person to commit a prohibited act and causing the
presence of a non-conforming gasoline-ethanol blend (such as a blend
designated as containing less than 15 vol% ethanol which actually
contains a greater concentration of ethanol) to be in the distribution
system. This is consistent with the provisions and implementation of
other fuels programs.
    Today's proposed rule, therefore, provides that most parties
involved in the chain of distribution would be subject to a presumption
of liability for committing prohibited actions and causing violations
by other parties. For example, an ethanol blender could be held
presumptively liable for causing a gasoline-ethanol blend that exceeds
the maximum ethanol content stated on the product's PTD to be present
in the distribution system unless the blender provides an affirmative
defense to

demonstrate that it did not cause the exceedance. An ethanol blender
could cause such an exceedance by adding too much ethanol to a blend or
making an error on the PTD that they prepare. An ethanol manufacturer
could be held presumptively liability for causing an exceedance of the
maximum ethanol content requirements unless it could demonstrate that
the ethanol it produced could not have caused the downstream
violation.\41\ Like other fuels regulations, a refiner also would be
subject to a presumption of vicarious liability for violations by any
downstream facility that displays the refiner's brand name, based on
the refiner's ability to exercise control at these facilities.
Carriers, however, would be liable only for violations arising from
product under their control or custody and not for causing non-
conforming gasoline to be in the distribution system, except where
specific evidence of causation exists. A carrier might cause an
exceedance of the ethanol content stated on the PTD for product in its
custody by commingling products with dissimilar ethanol contents. For
example, a carrier might cause the ethanol content of a product
designated as E15 to exceed 15 vol% ethanol by transporting the product
in a tank truck that had previously transported E85 that had not been
properly drained.
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    \41\ For example, an ethanol manufacturer might cause a
downstream exceedance of maximum ethanol content requirements if
they did not add the required amount of denaturant.
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b. Affirmative Defenses for Liable Parties
    This proposal also includes affirmative defenses for each party
that is deemed liable for a violation. Additionally, all presumptions
of liability are rebuttable. The proposed defenses are similar to the
defenses available to parties for violations of the RFG and diesel
sulfur regulations. We believe that these defense elements set forth
reasonably attainable criteria to rebut a presumption of liability. We
are proposing that the affirmative defense require a party to
demonstrate all of the following: (1) The party did not commit or cause
the violation; (2) the party has PTDs indicating that the fuel was in
compliance at its facility; and (3) except for retailers and wholesale
purchaser-consumers, the party conducted a quality assurance program.
For parties other than tank truck carriers, we are proposing that the
quality assurance program would be required to include periodic
sampling and testing of gasoline-ethanol blends for their ethanol
content. For tank truck carriers, we are proposing that the quality
assurance program would not need to include periodic sampling and
testing of the gasoline-ethanol blend, but in lieu of sampling and
testing, the carrier would be required to demonstrate evidence of an
oversight program for monitoring compliance, such as appropriate
guidance to drivers on compliance with applicable requirements and the
periodic review of records concerning the quality of gasoline-ethanol
blends and their delivery.
    With respect to the assessment of liability for the introduction of
E15 into any engines, vehicles or equipment that are not covered by the
partial waiver for use of E15, EPA would typically not hold a self-
service fuel retailer liable for customer misfueling if the retailer
has labeled their dispensers appropriately and did not condone or
facilitate such misfueling.
    We are proposing that participation in the ethanol content survey
could be used to meet some or all of the periodic sampling and testing
elements of a regulated party's (e.g. branded refiners, ethanol
blenders, and fuel distributors) affirmative defenses to presumptive
liability in cases where instances of noncompliance with the applicable
maximum ethanol content specification are discovered.\42\ In addition
to participation in the survey, we are proposing that ethanol blenders
would be required to periodically test the accuracy of their equipment/
methods used to add ethanol to gasoline. We are proposing that all
other regulated parties could satisfy all of the periodic sampling and
testing elements of their affirmative defenses to presumptive liability
by participating in the survey.
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    \42\ See section III.C. of today's notice for a discussion of
the ethanol content survey and section IV for a discussion of the
RVP survey.
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    As in other fuel regulations, branded refiners would be subject to
more stringent standards for establishing a defense because of the
control such refiners have over branded downstream parties. Under
today's rule, in addition to other presumptive liability defense
elements, we are proposing that branded refiners would also be required
to show that the violation was caused by an action by another person in
violation of law, an action by another person in violation of a
contractual agreement with the refiner, or the action of a distributor
not subject to a contract with the refiner for the transportation of
the gasoline.
    Based on experience with other fuels programs, we believe that a
presumptive liability approach would increase the likelihood of