37735

Rules and Regulations Federal Register Vol. 83, No. 149

Thursday, August 2, 2018

This section of the FEDERAL REGISTER DATES: The final rule is effective 4. Feedstock Pretreatment contains regulatory documents having general October 1, 2018. 5. Fuel Production applicability and legal effect, most of which 6. Fuel Distribution ADDRESSES: The EPA has established a are keyed to and codified in the Code of 7. Fuel Use docket for this action under Docket ID Federal Regulations, which is published under 8. Results of GHG Lifecycle Analysis 50 titles pursuant to 44 U.S.C. 1510. No. EPA–HQ–OAR–2017–0655. All the IV. Definition of Distillers Corn Oil documents in the docket are listed on V. Summary The Code of Federal Regulations is sold by the http://www.regulations.gov website. VI. Statutory and Executive Order Reviews the Superintendent of Documents. Although listed in the index, some A. Executive Order 12866: Regulatory information is not publicly available, Planning and Review and Executive e.g., CBI or other information whose Order 13563: Improving Regulation and ENVIRONMENTAL PROTECTION disclosure is restricted by statute. Regulatory Review AGENCY Certain other material, such as B. Executive Order 13771: Reducing Regulations and Controlling Regulatory 40 CFR Part 80 copyrighted material, is not placed on the internet and will be publicly Costs [EPA–HQ–OAR–2017–0655; FRL–9981–57– available only in hard copy form. C. Paperwork Reduction Act (PRA) OAR] Publicly available docket materials are D. Regulatory Flexibility Act (RFA) available electronically through http:// E. Unfunded Mandates Reform Act RIN 2060–AT82 (UMRA) www.regulations.gov. F. Executive Order 13132: Federalism Renewable Fuel Standard Program: FOR FURTHER INFORMATION CONTACT: G. Executive Order 13175: Consultation Grain Sorghum Oil Pathway Diana Galperin, Office of Air and and Coordination With Indian Tribal AGENCY: Environmental Protection Radiation, Office of Transportation and Governments Agency (EPA). Air Quality, Mail Code: 6401A, U.S. H. Executive Order 13045: Protection of Children From Environmental Health ACTION: Final rule. Environmental Protection Agency, 1200 Pennsylvania Avenue NW, Washington, Risks and Safety Risks SUMMARY: In this action, the DC 20460; telephone number: 202–564– I. Executive Order 13211: Actions Environmental Protection Agency (EPA) Concerning Regulations That 5687; email address: galperin.diana@ Significantly Affect Energy Supply, determines that biodiesel and heating epa.gov. oil produced from distillers sorghum oil Distribution, or Use SUPPLEMENTARY INFORMATION: J. National Technology Transfer via a transesterification process, and Advancement Act (NTTAA) renewable diesel, jet fuel, heating oil, Outline of This Preamble K. Executive Order 12898: Federal Actions naphtha, and liquefied petroleum gas To Address Environmental Justice in (LPG) produced from distillers sorghum I. General Information A. Does this action apply to me? Minority Populations and Low-Income oil via a hydrotreating process, meet the B. What action is the agency taking? Populations lifecycle GHG emissions reduction C. What is the agency’s authority for taking L. Congressional Review Act (CRA) threshold of 50 percent required for this action? I. General Information advanced biofuels and biomass-based D. What are the incremental costs and diesel under the Renewable Fuel benefits of this action? A. Does this action apply to me? Standard (RFS) program. Based on these II. Introduction analyses, EPA is adding these pathways III. Analysis of GHG Emissions Associated Entities potentially affected by this to the list of approved renewable fuel With Production of Biofuels From action are those involved with the production pathways in the RFS Distillers Sorghum Oil production, distribution, and sale of regulations. EPA is also amending the A. Overview of Distillers Sorghum Oil transportation fuels, including gasoline B. Analysis of Lifecycle GHG Emissions RFS regulations by adding a new 1. Livestock Sector Impacts and diesel fuel or renewable fuels such definition of ‘‘distillers sorghum oil,’’ a. Nutritional Impacts as ethanol, biodiesel, heating oil, and replacing existing references to b. Mass Loss renewable diesel, naphtha and liquefied ‘‘non-food grade corn oil’’ with the 2. Feedstock Production petroleum gas. Potentially regulated newly defined term ‘‘distillers corn oil.’’ 3. Feedstock Transport categories include:

Examples of potentially affected entities NAICS1 codes

Petroleum refineries (including importers) ...... 324110 Ethyl alcohol manufacturing ...... 325193 Other basic organic chemical manufacturing ...... 325199 Chemical and allied products merchant wholesalers ...... 424690 Petroleum bulk stations and terminals ...... 424710, 424720 Other fuel dealers ...... 454310

This table is not intended to be for readers regarding entities likely to be the types of entities that the EPA is now exhaustive, but rather provides a guide regulated by this action. This table lists aware could potentially be affected by

1 North American Industry Classification System.

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this action. Other types of entities not fossil fuel present in transportation fuel, used to determine whether a fuel meets listed in the table could also be affected. heating oil, or jet fuel. Non-exempt the necessary GHG reductions required To determine whether your entity is renewable fuels must achieve at least a under the CAA. Lifecycle analysis regulated by this action, you should 20 percent reduction in lifecycle includes an assessment of emissions carefully examine the applicability greenhouse gas (GHG) emissions as related to the full fuel lifecycle, criteria in the referenced regulations. If compared to a 2005 petroleum including feedstock production, you have any questions regarding the baseline.3 Advanced biofuel and feedstock transportation, fuel applicability of this action to a biomass-based diesel must achieve at production, fuel transportation and particular entity, consult the person least a 50 percent reduction, and distribution, and tailpipe emissions. Per listed in the FOR FURTHER INFORMATION cellulosic biofuel must achieve at least the CAA definition of lifecycle GHG CONTACT section. a 60 percent reduction. emissions, EPA’s lifecycle analyses also include an assessment of significant B. What action is the agency taking? In addition to the lifecycle GHG reduction requirements, there are other indirect emissions, such as those from EPA is amending the RFS regulations definitional criteria for renewable fuel land use changes and agricultural sector to add a new definition of ‘‘distillers (e.g., produced from renewable biomass impacts. sorghum oil’’ and to replace existing as defined in the statute and regulations, EPA received a petition from the references to ‘‘non-food grade corn oil’’ and used to reduce or replace the National Sorghum Producers (NSP), with the newly defined term ‘‘distillers quantity of fossil fuel present in submitted under partial claims of corn oil.’’ This rule also adds the transportation fuel, heating oil, or jet confidential business information (CBI), following pathways to rows F and H of fuel) in CAA section 211(o) and the RFS requesting that EPA evaluate the GHG Table 1 to 80.1426: (1) Biodiesel and regulations at 40 CFR part 80 subpart M. emissions associated with biofuels heating oil produced from distillers Since the formation of the RFS produced using as a feedstock grain sorghum oil and commingled distillers program, EPA has periodically sorghum oil derived from dry mill sorghum and corn oil via a promulgated rules to add new pathways ethanol production, and that EPA transesterification process; and (2) to the regulations.4 In addition, EPA has provide a determination of the renewable diesel, jet fuel, and heating approved facility-specific pathways renewable fuel categories, if any, for oil produced from distillers sorghum oil through the petition process in 40 CFR which such biofuels may be eligible. and commingled distillers sorghum and 80.1416. There are three critical EPA issued a proposed rule in 5 corn oil via a hydrotreating process. components of approved fuel pathways December 2017 to establish approved Pathways for naphtha and LPG under the RFS program: (1) Fuel type; pathways for the use of grain sorghum produced from distillers sorghum oil via (2) feedstock; and (3) production oil, and received comments on this a hydrotreating process are also added process. Each pathway is associated proposal. In this action, EPA is to row I of Table 1 to 40 CFR 80.1426. with a specific ‘‘D-code’’ that amending the RFS program regulations These pathways are approved for corresponds to one of the four categories to define the term ‘‘distillers sorghum biomass-based diesel (D-code 4) or of renewable fuel—general renewable oil.’’ We are also adding pathways to advanced biofuel (D-code 5) renewable fuel, advanced biofuel, cellulosic rows F, H and I of Table 1 to 40 CFR identification numbers (RINs), biofuel, or biomass-based diesel. 80.1426 for biodiesel, renewable diesel, depending on the fuel type and whether EPA’s lifecycle analyses are used to heating oil, naphtha, and LPG produced the production process involves co- assess the overall GHG emissions of a from distillers sorghum oil, via processing renewable biomass and transesterification or hydrotreating fuel throughout each stage of its petroleum.2 processes. production and use. The results of these This preamble describes EPA’s C. What is the agency’s authority for analyses, considering uncertainty and analysis of the GHG emissions taking this action? the weight of available evidence, are associated with distillers sorghum oil Statutory authority for this action when used to produce specified biofuels comes from Clean Air Act sections 114, 3 A baseline volume of renewable fuel produced from facilities that commenced construction on or via particular processes. The analysis 208, 211, and 301. before December 19, 2007, and which completed considers a scenario where distillers construction by December 19, 2010, without an 18- sorghum oil is recovered from distillers D. What are the incremental costs and month hiatus in construction, is exempt from the benefits of this action? grains with solubles (DGS) at dry mill minimum 20 percent GHG reduction requirement plants that produce biofuel from grain There are no incremental costs from that otherwise applies to renewable fuel. In addition, a baseline volume of ethanol from sorghum and where the remaining this action. This action allows for facilities that commenced construction after reduced-oil DGS co-product is used as additional flexibility and feedstock December 19, 2007, and on or before December 31, animal feed. The distillers sorghum oil production options for participating in 2009, qualifies for the same exemption if is then used as a feedstock for the Renewable Fuel Standard (RFS) construction was completed within 36 months without an 18-month hiatus in construction; the conversion into certain biofuels. As program. facility was fired with natural gas, biomass, or any described in section III.B.8 of this II. Introduction combination thereof, at all times the facility preamble, we find that, under these operated between December 19, 2007, and circumstances, biodiesel and heating oil December 31, 2009; and the baseline volume Section 211(o) of the Clean Air Act produced from distillers sorghum oil via (CAA) establishes the RFS program, continues to be produced through processes fired with natural gas, biomass, or any combination a transesterification process meets the under which EPA sets annual thereof. 50 percent GHG reduction threshold percentage standards specifying the 4 Please see information on Pathways I and required for advanced biofuel and amount of renewable fuel, as well as Pathways II in 40 CFR part 80 subpart M, and in biomass-based diesel. We also find that, three subcategories of renewable fuel, the Federal Register at 78 FR 14190 (March 5, 2013) and 79 FR 42128 (July 18, 2014). More information under these circumstances, renewable that must be used to reduce or replace on these can be found at: https://www.epa.gov/ diesel, jet fuel, naphtha, and LPG renewable-fuel-standard-program/final-rule- produced from distillers sorghum oil via 2 The term ‘‘biomass-based diesel’’ is defined in identify-additional-fuel-pathways-under-renewable- the statute to exclude any renewable fuels derived fuel and https://www.epa.gov/renewable-fuel- a hydrotreating process meets the 50 from co-processing biomass with a petroleum standard-program/renewable-fuel-pathways-ii-final- feedstock. CAA Section 211(o)(1)(D). rule-identify-additional-fuel. 5 82 FR 61205 (December 27, 2017).

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percent GHG emission reduction generated using that feedstock code.8 Dry mill ethanol and butanol 10 plants threshold required for advanced biofuel. Fuel producers will be instructed on grind and ferment grain sorghum,11 As discussed in section IV of this how and when to remove the non-food produce ethanol or butanol from the preamble, EPA is also amending the grade corn oil feedstock from their fermented grain sorghum starch, and RFS regulations to add a new definition registration. also produce a DGS co-product (made of for ‘‘distillers corn oil’’ that is consistent With no known exceptions, ethanol non-fermentable solids, solubles syrup, with the new definition of distillers and sorghum oil) that is sold as a type sorghum oil. The definitional change for plants that recover grain sorghum oil also, and in most cases simultaneously, of livestock feed. A portion of the oil distillers corn oil was proposed in the that would otherwise reside in the DGS recover corn oil by the same methods. November 2016 Renewable can be recovered at the biofuel plant, Thus, for practical implementation Enhancement and Growth Support typically through mechanical extraction. purposes, it is important to finalize the proposed rule (the ‘‘November 2016 Sorghum oil is recovered through 6 distillers corn oil definitional changes REGS proposed rule’’). Although that methods identical to that of corn oil in this rulemaking, to provide rule proposed to revise the definition of recovered from DGS, and corn and consistency between these regulatory corn oil extraction, after considering the sorghum oil recovery can occur at the definitions. Finally, we also include in comments received, we decided it was same facilities. more appropriate to leave the definition this rulemaking pathways for biodiesel The recovered distillers corn and of corn oil extraction unchanged, and and heating oil produced from sorghum oils contain a high instead add and define the term commingled distillers sorghum oil and concentration of free-fatty acids, greater distillers corn oil. This new term, distillers corn oil via a than ten percent by weight,12 and are distillers corn oil, will replace the transesterification process, and unsuitable for human consumption existing term, non-food grade corn oil renewable diesel, jet fuel, and, heating without further refining. It can, (which some parties have found oil produced from commingled distillers however, be used without further unclear) in rows F and H of Table 1 to sorghum and corn oil via hydrotreating 40 CFR 80.1426. The primary difference processes. refining as a biofuel feedstock or as an between the existing and new terms is ingredient in animal feed. There are III. Analysis of GHG Emissions that the new definition of distillers corn existing approved RFS fuel pathways for Associated With Production of Biofuels biofuels produced from distillers corn oil allows for the recovery of corn oil at 13 additional points in the ethanol From Distillers Sorghum Oil oil to qualify for advanced biofuel (D- code 5) or biomass-based diesel (D-code production process (provided certain A. Overview of Distillers Sorghum Oil conditions are met). Thus, although the 4) RINs, depending on the production new definition allows additional corn Sorghum is native to Africa, but was process used (see rows F and H of Table oil to be used as a feedstock in the introduced to the U.S. in the early 17th 1 to 40 CFR 80.1426). This rulemaking relevant pathways, the same life cycle century. Grain sorghum belongs to the establishes similar pathways for the use considerations apply and the analyses species Sorghum bicolor (L.) Moench,9 of distillers sorghum oil as currently for those pathways are unaffected.7 The which has been bred for different exist for the use of distillers corn oil, purpose and practical effect of this final purposes including use as a grain (grain and also establishes an additional rule, to allow corn oil extraction at more sorghum), a source of sugar (sweet pathway in row I of Table 1 to 40 CFR stages of ethanol production, closely sorghum), and animal forage (biomass 80.1426, as discussed further below. match the notice of proposed sorghum). In the U.S., grain sorghum is In previous actions, EPA has rulemaking on this topic. In light of the commonly used as animal feed similar approved pathways for the production practical similarity between ‘‘non-food to feed corn, although in some parts of of ethanol from grain sorghum made grade corn oil’’ and ‘‘distillers corn oil’’ the world it is more often grown for through a dry mill process as qualifying and to avoid implementation difficulties human consumption. Pathways for for renewable fuel (D-code 6) RINs, and from continuing to administer ethanol produced from grain sorghum in some cases advanced biofuel (D-code registrations with obsolete terms, fuel were approved in a rule published on 5) RINs, depending on process energy producers who are currently registered December 17, 2012 (77 FR 74592). We sources used during production.14 In for pathways that include non-food also discussed biomass sorghum in a December 2016, EPA also approved grade corn oil as a feedstock will need Federal Register Notice published on (with conditions) a facility-specific to update their registration to include December 31, 2014 (79 FR 78857). In pathway for advanced butanol distillers corn oil feedstock through a that notice, we stated that EPA does not (qualifying for (D-code 5) RINs) company update in EPA’s Central Data consider hybrids of Sorghum bicolor Exchange (CDX). After the effective date and Johnsongrass (Sorghum halepense) 10 Given that ethanol production far exceeds that of this final rule, including a reasonable to be biomass sorghum. We would also of butanol, for the sake of brevity, this preamble often refers only to dry mill ethanol plants, but transition period to allow for adequate not consider such hybrids to be grain time for registration updates to be butanol plants are implied to be included in such sorghum. Johnsongrass hybrids are references, unless stated otherwise. initiated and processed, the non-food explicitly excluded due to concerns 11 Grain sorghum refers to Sorghum bicolor (L.) grade corn oil feedstock code will be regarding their potential to behave as an Moench ssp. Bicolor, see: https://plants.usda.gov/ removed and RINs will not be able to be core/profile?symbol=sobib. invasive species. 12 A Moreau, Robert & B Hicks, Kevin & Johnston, 6 81 FR 80828 (November 16, 2016). David & P. Laun, Nathan. (2010). The Composition 8 of Crude Corn Oil Recovered after Fermentation via 7 See 81 FR 80828, 80900 (‘‘[W]e believe that the For more information on EPA’s guidelines for Centrifugation from a Commercial Dry Grind precise timing and method of corn oil extraction is registration updates see memo to the docket, not relevant for GHG reductions to be accomplished ‘‘Registration Approach for Fuel Producers Ethanol Process. Journal of the American Oil pursuant to pathways F and H, provided that: (1) Transitioning from Non-Food Grade Corn Oil to Chemists’ Society. 87. 10.1007/s11746–010–1568–z. The corn is converted to ethanol; (2) The corn oil Distillers Corn Oil Feedstock,’’ in Air Docket EPA– 13 This rulemaking replaces the term ‘‘non-food is extracted at a point in the dry mill ethanol HQ–OAR–2017–0655. grade corn oil’’ in the feedstock column of rows F production process that renders it unfit for food 9 See, U.S. Department of Agriculture Natural and H of Table 1 to 40 CFR 80.1426 with ‘‘distillers uses without further refining; and (3) The resulting Resource Conservation Service, https:// corn oil.’’ See section VI of this preamble for further DGS from the dry mill operation is marketable as plants.sc.egov.usda.gov/core/profile?symbol= discussion. animal feed.’’) SOBI2, accessed July 02, 2018. 14 Table 1 to 40 CFR 80.1426, Rows R and S.

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produced from grain sorghum as a quantities of feedstocks used’’ for each intend to inform companies with feedstock.15 batch of renewable fuel produced or existing facility-specific pathway Currently about 30 percent of grain imported. The regulations do not approvals for non-food grade corn oil, sorghum grown, or 120 million bushels specify a method for fuel producers to granted through the 40 CFR 80.1416 a year, goes towards ethanol use in determining the quantity of each petition process, that such pathway production.16 Most of this production feedstock when the feedstocks are approvals will be interpreted by EPA as occurs in Texas, Oklahoma, and received as a commingled shipment, as approvals for distillers corn oil. (This Kansas.17 For comparison, in recent would likely be the case for distillers gives such producers the same treatment years over 5,200 million bushels of corn corn oil and distillers sorghum oil. A as producers who registered for non- have been used for ethanol production number of commenters recommended food grade corn oil feedstock without annually.18 Distillers sorghum oil can be that EPA clarify the treatment of mixed first being approved for a facility- produced at these facilities and used for distillers corn and sorghum oil in the specific petition.) In order to generate biofuel production or other uses. final rule. Based on these comments, we (D-code 5) RINs for naphtha and/or LPG However, it is still a relatively niche believe it is appropriate to clarify the produced from distillers corn oil and/or product, and the NSP petition treatment of commingled distillers corn commingled distillers corn and sorghum anticipates that with approval of an RFS and sorghum oils in this rule. Given our oil, a fuel producer would first need to pathway, a potential of 12 to 21 million expectation that a large share of petition EPA pursuant to 40 CFR ethanol-equivalent gallons of biofuel distillers sorghum oil will be mixed 80.1416, have EPA review and approve would be produced from the distiller with distillers corn oil when it is their requested pathway, and then sorghum oil per year. recovered, from a practical standpoint, submit and have EPA accept the To the extent that distillers sorghum approving a distillers sorghum oil registration for the new pathway. oil is used as a biofuel feedstock, it will pathway without clearly allowing for EPA sought comment in the December often be produced together with the use of commingled shipments 2017 sorghum oil proposed rule on a distillers corn oil at ethanol plants using would unnecessarily constrain the use proposed definition for distillers a combination of grain sorghum and of these potential feedstocks. Further, sorghum oil. We summarize comments corn as feedstocks for ethanol we acknowledge that it is not practical received below, with a more detailed production. The commingled distiller to require parties to separate the oils summary and analysis included in the sorghum and corn oils will then be from this mixture and report the docket for this rulemaking. EPA shipped as a mixture to a different distillers sorghum and corn oils as received one comment on the proposed biofuel production facility for use as a individual feedstocks. Taking these definition, asking that EPA clarify the feedstock.19 Due to the recovery process factors into consideration and for ease of phrase ‘‘rendered unfit for food uses’’ to of the oils from the DGS, where the implementation, we are adding specify that this means human food uses ethanol plant is using a feedstock that ‘‘Commingled distillers corn and and not animal food uses. In this combines grain sorghum and corn, it is sorghum oils’’ as a feedstock to rows F comment EPA was also asked to finalize not possible to physically separate the and H of Table 1 to 40 CFR 80.1426. revisions to the definition of corn oil distillers sorghum and corn oils into Thus, facilities producing fuel through extraction that was proposed in the two streams, nor is it possible to these pathways can treat commingled November 2016 REGS proposed rule. account for the volume of sorghum oil distillers corn oil and distillers sorghum The requested clarification is consistent or corn oil in this mixture. Due to this oil as a single feedstock and report the with EPA’s intended meaning, and we specific recovery process and inability combined volume of these oils in RIN are finalizing a definition that says, ‘‘the to separate or allocate volume generation reports under 40 CFR oil is unfit for human food use without associated with each oil in the mixture, 80.1451(b)(ii)(K). They may also further refining.’’ We are also removing we are allowing the mixture of distiller generate RINs in accordance with the the word ‘‘rendered’’ from this part of sorghum and corn oil to be reported formula in 40 CFR 80.1426(f)(2) for the definition, as it is unnecessary and together as one volume. For example, renewable fuel that can be described by seemed to raise questions for the RFS regulations at 40 CFR a single pathway. commenters without any clear benefit. 80.1451(b)(ii)(K) require renewable fuel At this time, EPA is not adding EPA received a number of comments producers to submit RIN generation ‘‘commingled distillers corn and on the November 2016 REGS proposed reports that include the ‘‘types and sorghum oil’’ as a feedstock to row I of rule related to the proposed changes to Table 1 to 40 CFR 80.1426 for the the definition of corn oil extraction 15 December 22, 2016 pathway approval for Gevo, production of naphtha and LPG via a Inc., https://www.epa.gov/renewable-fuel-standard- contained in that proposed rule. Based program/gevo-inc-approval. hydrotreating process. Non-food grade on these comments, we have made a 16 Sorghum Checkoff, ‘‘Renewables,’’ http:// corn oil is not currently listed in that number of changes to the proposed www.sorghumcheckoff.com/market-opportunities/ row, nor has EPA proposed to add it (or definition of distillers sorghum oil to renewables, accessed 09-05-2017, (EPA-HQ-OAR- distillers corn oil). Thus, it would be ensure that it aligns with the definition 2017-0655-0015). 17 USDA, NASS, ‘‘Sorghum for Grain 2016 premature for EPA to add either of distillers corn oil. These comments Harvested Acres by County for Selected States,’’ distillers corn oil or commingled and associated changes are discussed in https://www.nass.usda.gov/Charts_and_Maps/ distillers corn and sorghum oil as section IV, and in more detail in a graphics/AS-HA-RGBChor.pdf, (EPA-HQ-OAR- feedstocks in row I. Through the fuel response to comment document in the 2017-0655-0019). pathway petition process, EPA 18 USDA, ERS, ‘‘Table 5—Corn supply, docket for this rulemaking. disappearance, and share of total corn used for previously approved two petitions As part of this rule, we are adding a ethanol,’’ U.S. Bioenergy Statistics, https:// allowing the generation of advanced definition of distillers sorghum oil in 40 www.ers.usda.gov/data-products/us-bioenergy- biofuel (D-code 5) RINs for naphtha and CFR 80.1401. So long as the criteria in statistics/us-bioenergy-statistics/#Feedstocks, the definition are met, a variety of accessed 09–05–2017, (EPA–HQ–OAR–2017–0655– LPG produced from non-food grade corn 20 0021). oil via a hydrotreating process. We recovery methods could be 19 See comment from the Renewable Fuels Association (EPA–HQ–OAR–2017–0655–0039) and 20 Renewable Energy Group’s facility in Geismar, Green Diesel’s facility in Norco, LA (https:// NSP petition, (EPA–HQ–OAR–2017–0655–0005), LA (https://www.epa.gov/renewable-fuel-standard- www.epa.gov/renewable-fuel-standard-program/ pp. 8. program/reg-geismar-approval-0) and Diamond diamond-green-diesel-llc-approval).

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implemented. For example, this would these comments and conducted further bushel of grain sorghum feedstock can include recovery of sorghum oil before analysis to estimate the potential be recovered using commercially fermentation from the slurry or from indirect GHG emissions associated with available mechanical extraction liquefaction tanks. It would also include replacing the extracted distillers technologies.24 When oil is recovered recovery of sorghum oil after sorghum oil. After accounting for these from the DGS, the total mass of DGS fermentation from the thin stillage and/ emissions, based on available produced could be reduced by up to or DGS. Further, it would also include information and reasonable assumptions approximately 6 percent. However, DGS recovery of sorghum oil by a third-party, to account for uncertainties, our revised from grain sorghum represents less than and/or at a separate location from the analysis continues to show that biofuels 3 percent of DGS fed to domestic biofuel plant. The definition of distillers produced from distillers sorghum oil livestock.25 Even if all distillers sorghum oil is consistent with the satisfy the 50 percent lifecycle GHG sorghum oil were removed from definition of distillers corn oil, which is reduction threshold required to qualify also being finalized in this rule (see as advanced biofuel or biomass-based livestock feed, the overall impact on the section IV of this preamble). diesel. Finally, some commenters on the livestock sector would be extremely proposed distillers sorghum oil rule small. To the extent that sorghum DGS B. Analysis of Lifecycle GHG Emissions suggested that EPA has an obligation to are likely to be fed in combination with EPA evaluated the GHG emissions engage in consultation with the United corn DGS and other livestock feed associated with using distillers sorghum States Fish and Wildlife Service and/or ingredients, the changes in oil content oil as a biofuel feedstock based on that National Marine Fisheries Service on the combined feed could potentially information provided by the petitioner, under Section 7 of the Endangered be too small to discern.26 In that case, input from the U.S. Department of Species Act prior to finalizing the rule. it is unlikely that feedstock suppliers Agriculture (USDA), public comments, Such consultation is required for actions would find a need to replace the and other available data sources. GHG in which the Agency has discretion to distillers sorghum oil with other oils. As emissions include emissions from tailor its actions for the benefit of mentioned previously, EPA has an production and transport of grain threatened or endangered species, or existing pathway approved for non-food sorghum, the production and transport their critical habitat, and where the grade corn oil, now referred to as of distillers sorghum oil; the processing action in question ‘‘may effect’’ listed distillers corn oil. Much of the current of the oil into biofuel; transport of the species. However, as described in the corn DGS on the feed market is already biofuel from the production facility to Response to Comments Document de-oiled, and because all known current the fuel-blender; and, ultimately the use accompanying this rule, EPA does not facilities using sorghum blend with corn of the biofuel by the end consumer. have discretion under the statute to take DGS, we do not expect any significant EPA’s lifecycle analyses include into consideration possible impacts to significant direct and indirect GHG changes in oil concentrations from what threatened or endangered species or already exists on the market. However, emissions (including such emissions their critical habitat in determining based on the comments received, we from land use changes) associated with which biofuels qualify under the have conducted additional analysis on producing a feedstock and transporting renewable fuel standard program as the potential indirect GHG emissions it to the processing facility. All of the advanced biofuel or biomass-based emissions associated with growing, diesel and, even if it did have such impacts on a per pound of oil extracted harvesting, and transporting grain discretion, today’s rule will have no basis. sorghum as a biofuel feedstock were effect on threatened or endangered Chemically, full-oil and reduced-oil calculated and taken into account in species. As a result, Section 7 sorghum DGS share similar EPA’s evaluation of the lifecycle GHG consultation is not required. compositions; they are primarily made emissions associated with grain up of crude protein, fat, and natural and 21 1. Livestock Sector Impacts sorghum ethanol and butanol. acid detergent fibers.27 Where the two In the proposed rule we described our During a typical dry mill fermentation products differ most significantly is in preliminary finding that biofuels process, DGS are produced. These DGS produced from distillers sorghum oil their acid detergent fiber and fat are then used as animal feed, thereby concentrations. reduce lifecycle GHG emissions by displacing feed crops and the GHG approximately 80 percent compared to emissions associated with growing and the petroleum baseline. These results transporting those feed crops. After assumed zero indirect GHG emissions distillers sorghum oil is removed, DGS 24 related to compensating for oil removal 0.88 pounds removal is at the highest end of continue to be produced and sold as the information NSP provided and corresponds to from DGS, based on the premise that livestock feed, but with reduced oil a fat content in reduced-oil distillers grains of certain types of livestock benefit from content. 3.91% rather than 7.2% which NSP considers as a lower-fat DGS and therefore removing We do not expect sorghum oil more likely outcome. the sorghum oil would not result in removal to have significant impact on 25 NSP petition (EPA–HQ–OAR–2017–0655– 0005), pp. 19. And, AgMRC, ‘‘Estimated U.S. Dried significant indirect impacts. EPA the types and quantities of feed used in Distillers Grains with Solubles (DDGS) Production received two comments arguing that the livestock market. EPA’s modeling & Use,’’ https://www.extension.iastate.edu/agdm/ extracting distillers sorghum oil from for the December 2012 grain sorghum crops/outlook/dgsbalancesheet.pdf, (EPA–HQ– DGS reduces the mass, calorific, and fat ethanol final rule assumed average dried OAR–2017–0655–0006). content of the DGS, and that there 26 See Air Docket EPA–HQ–OAR–2017–0655, DGS yield of 17 pounds per bushel of U.S. Department of Agriculture, Office of the Chief would be significant indirect GHG grain sorghum feedstock.22 The oil Scientist and Office of the Chief Economist, emissions associated with replacing content of full oil DGS is approximately ‘‘Memorandum: Technical responses on EPA these losses with other sources of 1.71 pounds per bushel,23 of which assumptions related to the lifecycle GHG livestock feed. As discussed below, we assessment of the proposed grain oil sorghum approximately 0.67–0.88 pounds per biofuel pathway,’’ March 15, 2018, pp. 4. have adjusted our analysis based on 27 Neutral detergent fibers measure the amount of 22 See 77 FR 74592 (December 17, 2012). structural component of plants, while acid 21 See the December 17, 2012 grain sorghum 23 NSP petition (EPA–HQ–OAR–2017–0655– detergent fibers measure the least digestible plant ethanol final rule (77 FR 74592). 0005), Attachment 4, pp. 7. components.

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Table III.1 shows the key constituents the ‘‘displacement rate’’ of a DGS, occurs when milk fat is reduced by 0.2 that make up dried full-oil and reduced- which indicates how much weight a percent or more.33 If milk fat depression oil DGS. pound of distillers grain can replace of occurs over the long term, a decline in another feed. A lower feed displacement overall milk production may occur as TABLE III.1—KEY NUTRIENT MAKE-UP rate for a reduced-oil distillers grain as well as worsened health conditions of OF FULL-OIL AND REDUCED-OIL compared to a full-oil distillers grain the herd. High fat diets have been linked DRIED DISTILLERS GRAINS WITH could result in additional GHG with this condition and have been SOLUBLES (DDGS) DERIVED FROM emissions as it suggests that additional shown to worsen the rumen 34 GRAIN SORGHUM 28 feed is required to replace the missing environment of dairy cattle. Therefore, oil. Displacement rates are calculated by dairy producers seek to avoid high fat Full-oil Reduced-oil taking into account nutrient and energy diets. Given the benefits of reduced-oil Nutrient sorghum sorghum requirements of livestock and their DGS over full-oil DGS for milk fat DDGS DDGS respective recommended DGS inclusion production, it is expected that reduced- rates to maintain animal performance.30 Crude Protein, % .. 30.80 31.36 oil DGS will be preferred over full-oil The next section (III.B.1.b. Mass Loss), Crude Fat, % (aka DGS by dairy producers and that feed Ether Extract) .... 9.75 3.91 describes how we used the displacement rates will be no lower Neutral Detergent displacement rate to analyze the than those of full-oil DGS. emissions impacts associated with the Fiber (NDF), % .. 33.60 37.23 An impact on displacement rates may removal of oil from sorghum DGS. Acid Detergent occur when reduced-oil instead of full- Fiber (ADF), % .. 22.68 31.91 Research suggests that for several oil DGS are used for beef cattle, which Ash, % ...... 6.62 7.60 livestock types there are performance require additional fat. Table III.2 shows Calcium, % ...... 0.12 0.08 improvements, per pound of DGS, when the displacement ratios for the livestock Phosphorus, % ..... 0.76 0.96 oil content of fed-DGS is removed. For sectors where dried DGS (DDGS) are Lysine, % ...... 0.82 0.62 instance, for poultry and swine, Methionine, % ...... 0.54 0.47 used. In this table, for instance, 1 pound ‘‘increased concentrations of free fatty Cystine, % ...... 0.53 0.61 of reduced-oil DDGS fed to beef cattle acids have a negative impact on lipid Tryptophan, % ...... 0.25 0.23 displaces 1.173 pounds of corn, as digestion and energy content.’’ 31 Free opposed to 1.196 pounds of corn for 29 fatty acids are a class of acids that form EPA received two comments full-oil DDGS. A pound of full-oil and regarding the potential greenhouse gas part of a lipid molecule. Full-oil DGS typically contain higher levels of free reduced-oil DDGS also displaces equal impacts on the livestock sector if the amounts (0.056 pounds) of urea. Urea is distillers oil is removed. One potential fatty acids and thus may have a negative impact on the fat digestion of poultry a non-protein nitrogen compound that is impact is based on whether a lower typically fed to cattle for aiding the crude fat concentration would require and swine. Thus, while the fat content may be lower for reduced-oil DGS, per production of protein by rumen changes in the livestock feed microbes.35 These values show that for composition to make up for the pound feeding values of this product may not be lower than full-oil DGS for dairy, swine, and poultry, reduced-oil nutritional loss to the livestock DDGS replace the same amounts of (nutritional impacts). The second poultry and swine and the feed displacement rate may not be lower for alternative feed despite containing less potential impact is related to the oil than full-oil DDGS. This is not the physical reduction in DGS mass reduced-oil versus full-oil DGS. For dairy, there are also benefits from case, however, with respect to beef resulting from the oil recovery (mass cattle. loss). We address both of these potential feeding reduced-oil DGS as compared to impacts in the following sections. full-oil DGS. Research on dairy cows shows that reduced-oil DGS produce a 33 University of Kentucky, ‘‘Preventing Milk Fat a. Nutritional Impacts lessened likelihood of the onset of milk Depression in Dairy Cows,’’ https://afs.ca.uky.edu/ dairy/preventing-milk-fat-depression-dairy-cows. 32 The key issue associated with the first fat depression. Milk fat depression Accessed September 08, 2018, (EPA–HQ–OAR– potential impact is whether the reduced 2017–0655–0017). On the herd level milk fats range 30 calories would impact the amount of For more detail see, Arora et al., (2008). from 3 to 5 percent normally. Oetzel, Garret R., Argonne National Laboratory. ‘‘Update of distillers ‘‘Subacute Ruminal Acidosis in Dairy Herds: feed displaced through the use of grains displacement ratios for corn ethanol Physiology, Pathophysiology, Milk Fat Responses, sorghum DGS. Should fat content not be life-cycle analysis’’ (EPA–HQ–OAR–2017–0655– and Nutritional Management.’’ Preconference at sufficient levels, livestock producers 0007). Seminar 7A: Dairy Herd Problem Investigation might need to add nutrients or other 31 Kerr, B.J., W.A. Dozier, and G.C. Shurson. Strategies: Lameness, Cow Comfort, and Ruminal types of feed to meet appropriate (2016). ‘‘Lipid digestibility and energy content of Acidosis, American Association of Bovine distillers’ corn oil in swine and poultry,’’ Journal Practitioners, 40th Annual Conference, September nutritional targets. This is reflected in of Animal Science. 94:2900–2908. doi:10.2527/ 17, 2007—Vancouver, BC, Canada, https:// jas.2016–0440, pp. 2905 (EPA–HQ–OAR–2017– www.vetmed.wisc.edu/dms/fapm/fapmtools/2nutr/ 28 The chart lists the most prominent constituents 0655–0010). sara1aabp.pdf pp.98. (EPA–HQ–OAR–2017–0655– in distillers grains. Data provided by the National 32 H.A. Ramirez-Ramirez, E. Castillo Lopez, C.J.R. 0012). Sorghum Producers, see Air docket EPA–HQ–OAR– Jenkins, N.D. Aluthge, C. Anderson, S.C. Fernando, 34 Penn State Extension, ‘‘Troubleshooting 2017–0655. Data for full-oil sorghum DDGS is K.J. Harvatine, P.J. Kononoff, (2016). ‘‘Reduced-fat Problems with Milkfat Depression,’’ August 14, sourced from Nutrient Requirements of Swine, 2012 dried distillers grains with solubles reduces the risk 2017, https://extension.psu.edu/troubleshooting- National Academies Press, Washington, DC, pp 329. for milk fat depression and supports milk problems-with-milkfat-depression. Accessed Data for reduced-oil Sorghum DDGS was calculated production and ruminal fermentation in dairy September 08, 2017, (EPA–HQ–OAR–2017–0655– by National Sorghum Producers using the ratio of cows,’’ Journal of Dairy Science, Volume 99, Issue 0016). (1) corn DDGS, between 6 to 9 percent Oil; and (2) 3, Pages 1912–1928, ISSN 0022–0302, http:// 35 Penn State Extension, ‘‘Urea in Beef Cattle corn DDGS, less than 4 percent oil from Nutrient dx.doi.org/10.3168/jds.2015-9712. (http:// Rations,’’ August 08, 2017, https:// Requirements of Swine, 2012 National Academies www.sciencedirect.com/science/article/pii/ extension.psu.edu/urea-in-beef-cattle-rations. Press, Washington, DC, pp. 266 and 267. S0022030216000515), (EPA–HQ–OAR–2017–0655– Accessed October 18, 2017, (EPA–HQ–OAR–2017– 29 EPA–HQ–OAR–2017–0655–0041, 0042. 0014). 0655–0018).

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TABLE III.2—FULL-OIL AND REDUCED-OIL SORGHUM DISTILLERS GRAINS WITH SOLUBLES DISPLACEMENT RATIOS 36 [lb of ingredient/lb of sorghum distillers grains with solubles, dry matter basis]

Beef cattle Dairy cattle Swine Poultry 37 Ingredient Full-oil Reduced-oil Full-oil Reduced-oil Full-oil Reduced-oil Full-oil Reduced-oil

Corn ...... 1.196 1.173 0.731 0.731 0.890 0.890 0.292 0.292 Soybean Meal...... 0.633 0.633 0.095 0.095 ...... Urea ...... 0.056 0.056 ......

b. Mass Loss When oil is removed from the substitution rate for how much corn sorghum DGS, the distillers grains would be needed for every pound of The second issue raised by the decrease in mass. Although feed rations grain sorghum oil diverted to biofuel commenters on potential livestock are complex, for the purposes of production, by livestock type (see Table indirect GHG impacts 38 relates to the conducting this analysis, in USDA’s III.3 below).43 potential impacts of mass reduction judgement it is a reasonable assumption from the removal of oil from sorghum to use corn to substitute for the mass TABLE III.3—FEED SUBSTITUTION DGS. The commenters also suggested loss due to sorghum oil recovery. Corn RATIO that EPA consider the impacts of is a relatively low cost primary product feeding reduced-oil sorghum DGS to all that is readily available in the locations Substitution 40 types of livestock rather than those where sorghum oil is produced. Feed ratio where performance gains were likely to Furthermore, USDA experts noted that Livestock type (lb feed substitute substitute/lb be seen. In evaluating these comments, to the extent that other materials such oil extracted) EPA has undertaken additional analysis as crop residues or waste from the to account for the potential indirect human food supply system were Beef ...... Corn ...... 1.551 GHG emissions associated with this available and used instead, they would Dairy ...... Corn ...... 0.731 ‘‘mass loss’’ effect. Since sorghum likely have a lower GHG profile than Swine ...... Corn ...... 0.890 accounts for less than 3 percent of the corn.41 To the extent that these other Poultry ...... Corn ...... 0.292 domestically consumed distillers grains, materials may be used, assuming corn there is very little market data on the substitutes for mass loss is a Using the national average shares for impacts of removing oil from the conservative assumption for a GHG DDGS use by livestock type,44 we sorghum DGS on the livestock sector. emissions perspective.42 calculated a weighted average 1.2 EPA, therefore, has relied on the To calculate the impact of the mass pounds of corn substituted per pound of expertise of USDA to inform the loss and the greenhouse gas emission distillers sorghum oil removed. Based livestock sector impact analysis impacts from the substitution of corn for on our modeling for the March 2010 described below.39 sorghum DGS, EPA used data obtained RFS rule, we have used an emissions from a study conducted by Argonne factor of 0.27 kgCO2e per pound of corn 36 Information provided by National Sorghum National Laboratory and estimates from produced, transported and consumed.45 Producers, see Air docket EPA–HQ–OAR–2017– NSP for the displacement of feed by The product of these values gives a 0655, using the following sources Arora et al., DGS by livestock type (see Table III.2). livestock sector impact of 0.31 kgCO e (2008). Argonne National Laboratory. ‘‘Update of 2 distillers grains displacement ratios for corn ethanol Using these data, we calculated a per pound of distillers sorghum oil, life-cycle analysis,’’ (EPA–HQ–OAR–2017–0655– which represents the potential indirect 0007); Kerr et al., (2016). ‘‘Lipid digestibility and biofuel pathway,’’ March 15, 2018, Air Docket EPA– emissions resulting from additional corn energy content of distillers’ corn oil in swine and HQ–OAR–2017–0655. produced to substitute for a loss in poultry,’’ Journal of Animal Science 94:2900–8, 40 Corn is demonstrably cheaper than other (EPA–HQ–OAR–2017–0655–0010); Opheim et al., feedstock replacements. For instance, in the U.S. sorghum DGS on a per pound of oil (2016). ‘‘Biofuel feedstock and blended coproducts corn in the 2016/2017 season averaged $0.06/lb extracted basis. The product of this compared with deoiled corn distillers grains in whereas, soy oil in 2017 averaged $0.32/lb and corn value and the yield for each type of feedlot diets: Effects on cattle growth performance, oil averaged $0.28. See USDA ERS, Feed Grains biofuel (pounds of distillers sorghum oil apparent total tract nutrient digestibility, and Yearbook, https://www.ers.usda.gov/data-products/ carcass characteristics,’’ Journal of Animal Science feed-grains-database/feed-grains-yearbook- per mmBtu of fuel) results in the 94:227, (EPA–HQ–OAR–2017–0655–0013); Ramirez tables.aspx (accessed on June 14, 2018) and USDA livestock sector GHG impacts listed in et al., (2016). ‘‘Reduced-fat dried distillers grains Vegetable Oils and Animal Fats, Oil Crop Yearbook, the results table in section III.B.8 of this with solubles reduces the risk for milk fat https://www.ers.usda.gov/data-products/oil-crops- preamble. depression and supports milk production and yearbook.aspx (accessed on June 06, 2018). ruminal fermentation in dairy cows,’’ Journal of 41 See, U.S. Department of Agriculture, Office of Dairy Science 99:1912–28, (EPA–HQ–OAR–2017– the Chief Scientist and Office of the Chief 43 See, Summary for the Final Rule of Key 0655–0014). Poultry displacement ratios were Economist, ‘‘Memorandum: Technical responses on Assumptions for EPA’s Analysis of the Lifecycle provided by the National Sorghum Producers and EPA assumptions related to the lifecycle GHG Greenhouse Gas Emissions Associated with calculated based on data from the Iowa State assessment of the proposed grain oil sorghum Biofuels Produced from Distillers Sorghum Oil and Extension Services, Agricultural Marketing and biofuel pathway,’’ March 15, 2018, Air Docket EPA– Distiller Sorghum Oil LCA Spreadsheet, Air Docket Resources Center, ‘‘Estimated U.S. Dried Distillers HQ–OAR–2017–0655. EPA–HQ–OAR–2017–0655. Grains with Solubles (DDGS) Production and Use,’’ 42 The purpose of lifecycle assessment under the 44 The data comes from the medium projections https://www.extension.iastate.edu/agdm/crops/ RFS program is not to precisely estimate lifecycle for the year 2016–2017 from AgMRC, ‘‘Estimated outlook/dgsbalancesheet.pdf (EPA–HQ–OAR– GHG emissions associated with particular biofuels, U.S. Dried Distillers Grains with Solubles (DDGS) 2017–0655–0006). but instead to determine whether or not the fuels Production & Use,’’ https://www.extension.iastate. 37 Protein sources such as soybean meal can be satisfy specified lifecycle GHG emissions thresholds edu/agdm/crops/outlook/dgsbalancesheet.pdf, used to supplement sorghum DGS for poultry. to qualify as one or more of the four types of (EPA–HQ–OAR–2017–0655–0006). 38 EPA-HQ-OAR–2017–0655–0041, 0042. renewable fuel specified in the statute. Where there 45 See the docket memo ‘‘Summary for the Final 39 See, U.S. Department of Agriculture, Office of are a range of possible outcomes and the fuel Rule of Key Assumptions for EPA’s Analysis of the the Chief Scientist and Office of the Chief satisfies the GHG reduction requirements when Lifecycle Greenhouse Gas Emissions Associated Economist, ‘‘Memorandum: Technical responses on ‘‘conservative’’ assumptions are used, then a more with Biofuels Produced from Distillers Sorghum EPA assumptions related to the lifecycle GHG precise quantification of the matter is not required Oil,’’ Air Docket EPA–HQ–OAR–2017–0655, for assessment of the proposed grain oil sorghum for purposes of a pathway determination. more details.

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2. Feedstock Production 3. Feedstock Transport energy balance data in the NSP petition, Distillers sorghum oil is removed In our analysis, distillers sorghum oil submitted under claim of CBI, the from DGS at dry mill biofuel plants is transported 50 miles by heavy duty conversion of yellow grease and using the same equipment and truck from the dry mill ethanol plant to distillers sorghum oil are expected to technologies used for distillers corn oil the biodiesel or hydrotreating facility require similar energy inputs and yield recovery. Oil recovery requires thermal where it is converted to transportation similar amounts of biodiesel as output. energy to heat the DGS and electricity fuel. GHG emissions associated with For production of renewable diesel, to power centrifuges, pumps and other feedstock transport are relatively small, jet fuel, naphtha and LPG via a oil recovery equipment. Our analysis for and modest changes in transport hydrotreating process, we used the same data and approach as used in the March the March 2010 RFS final rule,46 the distance would not affect the threshold 2013 Pathways I rule,54 and subsequent NSP petition, and two studies,47 48 determinations based on our analysis. facility-specific petitions involving indicate that although extracting oil 4. Feedstock Pretreatment hydrotreating processes.55 The March from DGS uses thermal energy, it also 2013 Pathways I rule evaluated two leads to relatively less thermal energy For emissions from feedstock hydrotreating configurations: One being used later in the process to dry the pretreatment and fuel production, we optimized for renewable diesel DGS, resulting in an overall negligible perform two analyses. In the first production and one optimized for jet change in thermal energy requirements analysis, we calculate the emissions fuel production. For this analysis we for plants that dry their DGS. Our from biodiesel and heating oil produced evaluated a hydrotreating process analysis here includes both the thermal using transesterification. In the second analysis, we calculate the emissions maximized for renewable diesel and electrical energy requirements to production, as that is the most common remove the distillers sorghum oil. We from renewable diesel, jet fuel, LPG, and naphtha, produced using hydrotreating. configuration. The jet fuel configuration do not account for the reduction in results in higher emissions thermal energy needed for DGS drying Before distillers sorghum oil is converted to biodiesel via (approximately 5 kgCO2e/mmBtu mentioned above, so this can be viewed higher), but the threshold GHG as a conservative approach (i.e., transesterification, it is processed to remove free-fatty acids. This process reduction results discussed below are resulting in higher estimated GHG requires thermal energy. Our evaluation not sensitive to this assumption. emissions) for plants that dry their DGS. of yellow grease for the March 2010 RFS Our previous analyses of Based on our review of the data,49 we final rule included 14,532 Btu of natural hydrotreating processes have applied an assume 200 Btu (British thermal units) gas per gallon of biodiesel produced for energy allocation approach for RIN- of grid electricity and 800 Btu of natural pretreatment, and we have applied the generating co-products that qualify as gas are used to recover distillers 56 same assumption for this analysis. renewable fuel. This approach results sorghum oil from DGS, per pound of According to the NSP petition, distillers in higher lifecycle GHG emissions for distillers sorghum oil recovered. These sorghum oil has free fatty acid content each of the fuel products than other parameters are based on energy near or below 15 percent, which is in approaches considered, such as a requirements associated with extracting the range of yellow grease free fatty acid displacement approach, and thus can be oil from DGS at dry mill ethanol plants, contents (<15 percent).51 Our viewed as a conservative approach. We but we believe they are also appropriate assumption on pretreatment thermal have used this approach in assessing and conservative in cases where the oil energy use for distillers sorghum oil is GHG emissions impacts of fuels derived is recovered at any point downstream from distillers sorghum oil. 50 higher than thermal energy use in other from sorghum grinding. (non-EPA) lifecycle assessments of high In the allocation approach, all the emissions from the hydrotreating 46 free-fatty acid biodiesel feedstocks that See section 1.4.1.3 of USEPA (2010). we have reviewed,52 and can be viewed process are allocated across all co- Renewable fuel standard program (RFS2) regulatory products. There are a number of ways to impact analysis. U.S. Environmental Protection as a conservative assumption (i.e., Agency Office of Transportation Air Quality, EPA– resulting in higher GHG emissions). do the allocation, for example on the 420–R–10–006. Washington, DC. https:// Pretreatment to remove free-fatty basis of energy, mass, or economic www.epa.gov/sites/production/files/2015-08/ acids is not required when distillers value. Consistent with the approach documents/420r10006.pdf. taken in the hydrotreating analysis for 47 Wang, Z., et al. (2015). ‘‘Influence of corn oil sorghum oil is used to produce recovery on life-cycle greenhouse gas emissions of renewable diesel, jet fuel, LPG and the March 2013 RFS rule, for this corn ethanol and corn oil biodiesel.’’ Biotechnology naphtha through a hydrotreating analysis of fuels produced from for Biofuels 8(1): 178, (EPA–HQ–OAR–2017–0655– process. distillers sorghum oil feedstock through 0020). a hydrotreating process, we allocated 48 Mueller, S., Kwik, J. (2013). ‘‘2012 Corn 5. Fuel Production emissions to the renewable diesel, Ethanol: Emerging Plant Energy and Environmental Technologies.’’ For biodiesel production, we used the naphtha and LPG based on the energy 49 See sources referenced in footnotes 20 and 21 transesterification analysis for the content (using lower-heating values) of for energy use associated with oil extraction, and March 2010 RFS rule for yellow grease the products produced. Emissions from California Air Resources Board (2014), (EPA–HQ– biodiesel.53 Based on comparison of this the process were allocated equally to all OAR–2017–0655–0011). ‘‘California-Modified yellow grease analysis and the mass and of the Btus of fuel produced. Therefore, GREET Fuel Pathway: Biodiesel Produced in the Midwestern and the Western U.S. from Corn Oil on a per Btu basis, all of the primary Extracted at Dry Mill Ethanol Plants that Produce extraction techniques that would yield higher levels products coming from the hydrotreating Wet Distiller’s Grains with Solubles.’’ Staff of oil. Overall, we expect any differences to be facility have the same emissions from Summary, Method 1 Fuel Pathway (EPA–HQ–OAR– small in the context of this distillers sorghum oil the fuel production stage of the 2017–0655–0009). analysis. 50 There are limited data on the energy efficiency 51 See Table 15 in the January 5, 2012 Pathways of alternative oil extraction technologies. Oil I direct final rule (77 FR 722). 54 See 78 FR 14190 (March 5, 2013). extraction earlier in the dry mill process would 52 See for example: California Environmental 55 For determination documents responding to offer energy efficiency benefits later in the process, Protection Agency Air Resources board, https:// facility specific petitions, see: https://www.epa.gov/ as moving oil through the fermentation and ethanol www.arb.ca.gov/fuels/lcfs/2a2b/apps/co_bd_wdgs- renewable-fuelstandard-program/approved- recovery processes tends to increase energy rpt-102414.pdf, (EPA–HQ–OAR–2017–0655–0008). pathways-renewable-fuel. requirements. Recovery further downstream at a 53 For details see section 2.4 of the RIA for the 56 See the March 2013 Pathways I rule, separate location would likely include chemical March 2010 RFS final rule. specifically 78 FR 14198–14200 (March 5, 2013).

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lifecycle. For this analysis, the energy assumed that heating oil, renewable sensitive to these assumptions. More content was the most appropriate basis diesel, jet fuel, LPG, and naphtha have details on our analysis of fuel use for allocating emissions because all of the same fuel distribution emissions as emissions are described in a memo 57 to the fuel products are used as sources of biodiesel per mmBtu of fuel used. the rulemaking docket. energy. Energy content also has the 7. Fuel Use 8. Results of GHG Lifecycle Analysis advantage of being a fixed factor as opposed to market prices which For this analysis we applied fuel use Table III.4 shows the lifecycle GHG fluctuate over time. emissions factors developed for the emissions associated with biofuels March 2010 RFS final rule. We used the produced from distillers sorghum oil 6. Fuel Distribution biodiesel emissions factor for biodiesel that result from our assessment. The We used the fuel distribution results and biodiesel used as heating oil. For table also shows the percent reduction from the biodiesel analysis for the renewable diesel and jet fuel we used relative to the petroleum baseline. All of March 2010 RFS rule. Fuel distribution the emissions factors for non-CO2 GHGs the fuels are compared to the diesel emissions are relatively small compared for baseline diesel fuel. For naphtha we baseline, except for naphtha which is to baseline lifecycle GHG emissions (see used the emissions factors for non-CO2 compared to the gasoline baseline. Table III.4: Lifecycle GHG Emissions GHGs for baseline gasoline fuel. For Based on the lifecycle GHG emissions Associated With Biofuels Produced LPG we used the LPG non-CO2 results presented above, all of the From Distillers Sorghum Oil (kgCO2-eq/ emissions factor developed for the pathways evaluated meet the 50 percent MJ) below), and although they may be March 2010 RFS rule. The tailpipe GHG reduction threshold required for different for different types of fuel, for emissions are relatively small, and the advanced biofuel and biomass-based the purposes of this analysis we threshold GHG reduction results are not diesel.

TABLE III.4—LIFECYCLE GHG EMISSIONS ASSOCIATED WITH BIOFUELS PRODUCED FROM DISTILLERS SORGHUM OIL

[kgCO2-eq/MJ]

Renewable Fuel Biodiesel, diesel, Naphtha LPG 2005 Diesel 2005 Gasoline heating oil jet fuel baseline baseline

Production process Transesterification Hydrotreating Refining

Livestock Sector Impacts ...... 20.7 19.4 19.4 19.4 ...... Feedstock Production ...... 6.6 6.2 6.2 6.2 18.0 19.2 Feedstock Transport ...... 0.3 0.3 0.3 0.3 Feedstock Pretreatment ...... 8.4 Fuel Production ...... 1.2 8.0 8.0 8.0 Fuel Distribution ...... 0.8 0.8 0.8 0.8 Fuel Use ...... 0.7 0.7 1.7 1.5 79.0 79.0

Total ...... 38.7 35.4 36.4 36.2 97.0 98.2

Percent Reduction ...... 60 64 63 63 ......

IV. Definition of Distillers Corn Oil The proposed definitional change was without further refining, and the oil motivated by the evolution of corn oil extraction results in distillers grains In the March 2010 RFS final rule, EPA extraction technology within the marketable as animal feed.’’ This established two pathways (pathways F ethanol industry, which allows ethanol definitional change was intended to and H in Table 1 to 40 CFR 80.1426) for producers to recover corn oil at different both address the developments in corn biomass-based diesel (D-code 4) or locations in the ethanol production oil extraction and to define the advanced biofuel (D-code 5) made from process, with potential energy efficiency conditions under which corn oil ‘‘non-food grade corn oil.’’ The lifecycle and ethanol yield benefits. qualifies as a feedstock for the purposes GHG analyses for these pathways were In the November 2016 REGS proposed of Table 1. based on the EPA’s modeling of corn oil rule, EPA reasoned that the precise As explained below, rather than the recovered from DGS produced by a dry- timing and method of corn oil extraction approach proposed in the 2016 REGS mill corn ethanol plant through corn oil are not relevant for meeting the 50 proposed rule, which would have extraction. In the November 2016 REGS percent GHG reduction threshold revised the term ‘‘corn oil extraction’’ proposed rule, EPA proposed to revise associated with pathways F and H, and replaced ‘‘non-food grade corn oil’’ pathways F and H in Table 1 to 40 CFR provided that a number of conditions with ‘‘oil from corn oil extraction’’ in are satisfied. Specifically, EPA proposed rows F and H, EPA is instead leaving 80.1426 to specify that the feedstock is the following definition for corn oil the definition of ‘‘corn oil extraction’’ ‘‘oil from corn oil extraction,’’ rather extraction: ‘‘Corn oil extraction means as-is and is finalizing a definition for the than ‘‘non-food grade corn oil,’’ and to the recovery of corn oil at any point term ‘‘distillers corn oil’’ that will be include a revised and somewhat downstream of when a dry mill corn used in Table 1. The substance of the broadened definition of ‘‘corn oil ethanol plant grinds the corn, provided definition of ‘‘distillers corn oil’’ extraction’’ relative to the 2010 that the corn is converted to ethanol, the finalized here is consistent with the definition.58 oil is rendered unfit for food uses proposed definition for ‘‘corn oil

57 See, ‘‘Summary of Key Assumptions for EPA’s Sorghum Oil,’’ Air Docket EPA–HQ–OAR–2017– 58 See section VII.B of the November 2016 REGS Analysis of the Lifecycle Greenhouse Gas Emissions 0655. proposed rule (81 FR 80900–01). Associated with Biofuels Produced from Distillers

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extraction,’’ other than changes made in definition of corn oil extraction.60 They process can be set up at a dry grind response to comments. Thus, based on said the proposed changes were needed ethanol plant and the resulting extracted the comments received on the to update the definition based on corn oil will still meet all the November 2016 REGS proposed rule, technological changes in the industry, requirements for corn oil extraction. EPA is taking the following actions in and to provide a level playing field for Two commenters requested that EPA this rulemaking: (1) Table 1 to 40 CFR new oil extraction methods. Seven clarify the proposed definition of corn 80.1426 is revised to replace the term commenters supported the proposed oil extraction by stating that ‘‘the oil is ‘‘Non-food grade corn oil’’ with revisions and recommended the rendered unfit for human food uses ‘‘Distillers corn oil’’ in rows F and H; relatively small revisions discussed without further refining.’’ 66 One and (2) 40 CFR 80.1401 is revised to add below.61 EPA also received four commenter requested that EPA clarify a definition of ‘‘distillers corn oil’’. comments on the December 2017 the proposed definition of corn oil extraction to state that the resulting The approach taken in this rule sorghum oil proposed rule that supported finalizing the expanded distillers grains include those that have preserves the existing meaning of corn been subjected to further oil recovery by oil extraction for the purpose of the definition of corn oil as part of this 62 a dry mill or third party.67 Three second row of Table 2 to 40 CFR rulemaking. While EPA is not finalizing the definition of ‘‘corn oil commenters stated that EPA’s proposed 80.1426 (the ‘‘corn oil extraction extraction’’ that was proposed in the addition of the phrase ‘‘at any point advanced technology’’); our intent was REGS rule, EPA believes that the downstream’’ is inconsistent with its to broaden the non-food grade corn oil approach being finalized today proposed approach for biointermediates pathways listed in Table 1 to 40 CFR addresses the concerns of these and should be clarified.68 The 80.1426, not to modify the corn oil commenters, as well as those of other commenters also state that the phrase extraction advanced technology commenters who raised questions about ‘‘oil is rendered unfit’’ is unnecessary specified in Table 2, which is relevant continued use of the term ‘‘non-food since all corn oil obtained from for corn starch ethanol pathways. The grade corn oil.’’ extraction is unfit for food uses. One corn oil extraction advanced technology While no commenters objected to commenter recommended using the was included in the regulations based EPA’s overall proposal to revise and term ‘‘distillers corn oil’’ as that term is on analysis completed in the March expand the types of extracted corn oil better understood in the industry, and 2010 RFS rule for pathways in rows A that qualify as approved feedstocks in USDA reporting, to reference corn oil and B of Table 1 that can include rows F and H of Table 1 to 40 CFR from dry mills. extracting oil from whole stillage and/or 80.1426, a number of commenters Based on these comments, EPA is derivatives of whole stillage, thus requested clarifications or modifications finalizing a definition that has been reducing energy use at dry mill ethanol modified in several ways compared to 59 to EPA’s proposed definition. Four plants. In order to avoid altering the commenters suggested that EPA should the one proposed in the November 2016 scope of corn oil extraction for the expand the definition of corn oil REGS proposed rule. First, EPA has purpose of Table 2 (which involves extraction even further to include corn decided to use the term ‘‘distillers corn different pathways than rows F and H), oil recovered at butanol plants, because oil’’ because we agree with the it is most appropriate to create a new the dry mill process for butanol is very commenter that the term is better definition for distillers corn oil and to similar to those for dry mill ethanol understood in the industry and thus preserve the existing definition of corn with respect to conversion of corn to enhances the clarity of the regulations. oil extraction. Incidentally, we generally liquefied mash and recovery of distillers Second, the definition has been revised anticipate that corn oil recovered grains and thin stillage.63 Five to include corn oil recovered at dry mill through corn oil extraction as listed in commenters suggested that EPA should butanol plants, given their similarities Table 2 to 40 CFR 80.1426 should be expand the definition of corn oil in terms of the oil recovery technologies able to qualify as distillers corn oil extraction to include corn oil from wet used, the characteristics of the oil (provided it satisfied all of the milling.64 These commenters stated that recovered and the resulting DGS co- definitional requirements) for the all corn oil meets the requirements of products. Third, we have clarified that purpose of the pathways in rows F and the RFS program and thus should be distillers corn oil is limited to oil that H in Table 1; however, not all distillers eligible feedstocks under the program. is unfit for human food use without corn oil will necessarily be recovered by Four commenters requested that EPA further refining. Fourth, we have processes that qualify as corn oil expand the definition of corn oil removed the word ‘‘rendered’’ from the extraction. The comments received on extraction to include corn oil extracted definition as it is unnecessary and EPA’s proposed corn oil definitional after corn fractionation.65 These seemed to raise questions for changes are summarized below, with a commenters stated that the fractionation commenters. Finally, we replaced the more detailed summary and analysis word ‘‘extraction’’ with ‘‘recovery’’ to included in the docket for this 60 EPA–HQ–OAR–2016–0041–0231, 0296, 0307 avoid any confusion about how the rulemaking. and 0313. For convenience, EPA is providing definition interacts with the term ‘‘corn citations to the docket for the REGS proposed rule oil extraction’’ in 40 CFR 80.1401 and Four commenters on the November for comments that were filed in that docket on 2016 REGS proposed rule supported proposed changes to the regulations for corn oil, but Table 2 to 40 CFR 80.1426. EPA’s proposed revision to the these comments have also been included in the Other modifications recommended by docket for this action. commenters have not been incorporated 61 EPA–HQ–OAR–2016–0041–0243, 0246, 0260, 59 EPA has consistently viewed the non-food into the definition finalized by this 0266, 0267, 0277 and 0286. grade corn oil pathways as only available for rulemaking. Corn oil from wet milling 62 facilities that extract corn oil produced at dry mill EPA–HQ–OAR–2017–0655–0034, 0039, 0028, remains excluded from the definition. 0038. corn ethanol plants (see letter from Karl Simon of Corn oil produced at wet mills is EPA to John W. Bode of the Corn Refiners 63 EPA–HQ–OAR–2016–0041–0243, 0246, 0267 Association, dated October 24, 2013). The change and 0286. from ‘‘non-food grade corn oil’’ to ‘‘distillers corn 64 EPA–HQ–OAR–2016–0041–0259, 0270, 0282, 66 EPA–HQ–OAR–2016–0041–0266 and 0277. oil’’ and the associated definition will more clearly 0300 and 0311. 67 EPA–HQ–OAR–2016–0041–0260. articulate this and other requirements for purposes 65 EPA–HQ–OAR–2016–0041–0278, 0282, 0300 68 EPA–HQ–OAR–2016–0041–0282, 0300 and of Table 1. and 0311. 0311.

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commonly sold as cooking oil for allowing commingled distillers sorghum direct effects on the states, on the human food uses, and thus may have and corn oil to be reported as one relationship between the national significantly different impacts than volume under the existing registration, government and the states, or on the distillers corn oil. The GHG emissions reporting and recordkeeping distribution of power and associated with substituting for oil requirements, and therefore are not responsibilities among the various removed from animal feed, and amending these sections. levels of government. specifically DGS, may be significantly VI. Statutory and Executive Order different than the GHG emissions G. Executive Order 13175: Consultation Reviews associated with substituting for oil and Coordination With Indian Tribal removed from cooking oil markets. A. Executive Order 12866: Regulatory Governments Thus, we believe the current LCA is Planning and Review and Executive This action does not have tribal insufficient to extend the pathway to Order 13563: Improving Regulation and implications as specified in Executive corn oil produced at wet mills and it Regulatory Review Order 13175. This final rule would would be more appropriate to address This action is not a significant affect only producers of distillers wet mill corn oil through a separate regulatory action and was therefore not sorghum oil and producers of biofuels action, such as a new fuel pathway submitted to the Office of Management made from distillers sorghum oil. Thus, petition submitted pursuant to 40 CFR and Budget (OMB) for review. Executive Order 13175 does not apply 80.1416. Fractionation is also not to this action. explicitly included, or otherwise B. Executive Order 13771: Reducing H. Executive Order 13045: Protection of mentioned, in the revised definition, as Regulations and Controlling Regulatory Children From Environmental Health EPA has previously found that oil Costs Risks and Safety Risks recovered through fractionation is likely This action is not expected to be an to be sold for human food use; 69 use of Executive Order 13771 regulatory action The EPA interprets Executive Order such oil for biofuel production would because this action is not significant 13045 as applying only to those require a modified lifecycle assessment under Executive Order 12866. regulatory actions that concern that is beyond the scope of this rule. environmental health or safety risks that Finally, EPA does not believe the C. Paperwork Reduction Act (PRA) EPA has reason to believe may definition finalized in this rulemaking This action does not impose any new disproportionately affect children, per contradicts the biointermediate information collection burden under the the definition of ‘‘covered regulatory provisions in the November 2016 REGS provisions of the Paperwork Reduction action’’ in section 2–202 of the proposed rule. Because it is listed as a Act, 44 U.S.C. 3501 et seq., and Executive Order. This action is not feedstock in Table 1 to 40 CFR 80.1426, therefore is not subject to these subject to Executive Order 13045 the current regulations accommodate requirements. because it because it does not concern an environmental health risk or safety distillers corn oil used through the D. Regulatory Flexibility Act (RFA) pathways in rows F and H unless it is risk. substantially altered at a separate I certify that this action will not have a significant economic impact on a I. Executive Order 13211: Actions facility before delivery to the fuel Concerning Regulations That production facility. substantial number of small entities under the RFA. This action will not Significantly Affect Energy Supply, V. Summary impose any requirements on small Distribution, or Use Based on our GHG lifecycle entities. An agency may certify that a This action is not subject to Executive evaluation described above, we find that rule will not have a significant Order 13211 because it is not a biodiesel and heating oil produced from economic impact on a substantial significant regulatory action under distillers sorghum oil via a number of small entities if the rule Executive Order 12866. transesterification process, and relieves regulatory burden, has no net J. National Technology Transfer renewable diesel, jet fuel and heating oil burden or otherwise has a positive Advancement Act (NTTAA) produced from distillers sorghum oil via economic effect on the small entities a hydrotreating process meet the 50 subject to the rule. This rule enables This rulemaking does not involve percent GHG reduction threshold distillers sorghum oil producers and technical standards. requirement for advanced biofuel and producers of biofuels from distillers K. Executive Order 12898: Federal biomass-based diesel. Based on this sorghum oil to participate in the RFS Actions To Address Environmental finding, and providing that all program, see CAA section 211(o), if they Justice in Minority Populations and regulatory requirements are satisfied, choose to do so in order to obtain Low-Income Populations these fuels are eligible for biomass- economic benefits. The EPA believes that this action does based diesel (D-code 4) RINs if they are E. Unfunded Mandates Reform Act not have disproportionately high and produced through a process that does (UMRA) adverse human health or environmental not co-process renewable biomass and effects on minority populations, low- petroleum, and for advanced biofuel (D- This action does not contain an income populations and/or indigenous code 5) RINs if they are produced unfunded mandate of $100 million or peoples, as specified in Executive Order through a process that does co-process more as described in UMRA, 2 U.S.C. 12898 (59 FR 7629, February 16, 1994). renewable biomass and petroleum. The 1531–1538, and does not significantly or This final rule does not affect the level RFS regulations are also amended to uniquely affect small governments. The of protection provided to human health add new and consistent definitions for action imposes no enforceable duty on or the environment by applicable air ‘‘distillers sorghum oil’’ and ‘‘distillers any state, local or tribal governments or quality standards. This action does not corn oil.’’ As discussed above, we are the private sector. relax the control measures on sources F. Executive Order 13132: Federalism regulated by the fuel programs and RFS 69 See the Regulatory Impact Analysis for the March 2010 RFS rule, section 1.1.3.2 (Corn Oil This action does not have federalism regulations and therefore will not cause Extracted During Ethanol Production). implications. It will not have substantial emissions increases from these sources.

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L. Congressional Review Act (CRA) PART 80—REGULATION OF FUEL recovery processes are marketable as AND FUEL ADDITIVES animal feed. This action is subject to the CRA, and Distillers sorghum oil means grain the EPA will submit a rule report to ■ 1. The authority citation for part 80 sorghum oil recovered at any point each House of the Congress and to the continues to read as follows: downstream of when a dry mill ethanol Comptroller General of the United Authority: 42 U.S.C. 7414, 7521, 7542, or butanol plant grinds the grain States. This action is not a ‘‘major rule’’ 7545, and 7601(a). sorghum, provided that the grain as defined by 5 U.S.C. 804(2). sorghum is converted to ethanol or Subpart M—Renewable Fuel Standard butanol, the recovered oil is unfit for List of Subjects in 40 CFR Part 80 human food use without further ■ 2. Section 80.1401 is amended by refining, and the distillers grains Environmental protection, adding, in alphabetical order, remaining after the dry mill and oil Administrative practice and procedure, definitions for ‘‘distillers corn oil’’ and recovery processes are marketable as Air pollution control, Diesel Fuel, Fuel ‘‘distillers sorghum oil’’ to read as animal feed. additives, Gasoline, Imports, Oil follows: imports, Petroleum, Renewable fuel. * * * * * § 80.1401 Definitions. ■ Dated: July 24, 2018. 3. Section 80.1426 is amended in * * * * * paragraph (f)(1), in Table 1 to § 80.1426, Andrew R. Wheeler, Distillers corn oil means corn oil by revising entries ‘‘F’’, ‘‘H’’, and ‘‘I’’ to Acting Administrator. recovered at any point downstream of read as follows: when a dry mill ethanol or butanol For the reasons set forth in the plant grinds the corn, provided that the § 80.1426 How are RINs generated and preamble, EPA amends 40 CFR part 80 corn starch is converted to ethanol or assigned to batches of renewable fuel by as follows: butanol, the recovered oil is unfit for renewable fuel producers or importers? human food use without further * * * * * refining, and the distillers grains (f) * * * remaining after the dry mill and oil (1) * * *

TABLE 1 TO § 80.1426—APPLICABLE D CODES FOR EACH FUEL PATHWAY FOR USE IN GENERATING RINS

Fuel type Feedstock Production process requirements D-code

******* F ...... Biodiesel, renewable diesel, jet Soy bean oil; Oil from annual One of the following: Trans- 4 fuel and heating oil. covercrops; Oil from algae Esterification Hydrotreating Ex- grown photosynthetically; Bio- cluding processes that co-proc- genic waste oils/fats/greases; ess renewable biomass and pe- Camelina sativa oil; Distillers troleum. corn oil; Distillers sorghum oil; Commingled distillers corn oil and sorghum oil.

******* H ...... Biodiesel, renewable diesel, jet Soy bean oil; Oil from annual One of the following: Trans- 5 fuel and heating oil. covercrops; Oil from algae Esterification Hydrotreating In- grown photosynthetically; Bio- cludes only processes that co- genic waste oils/fats/greases; process renewable biomass and Camelina sativa oil; Distillers petroleum. corn oil; Distillers sorghum oil; Commingled distillers corn oil and sorghum oil. I ...... Naphtha, LPG ...... Camelina sativa oil; Distillers sor- Hydrotreating ...... 5 ghum oil.

*******

* * * * * [FR Doc. 2018–16246 Filed 8–1–18; 8:45 am] BILLING CODE 6560–50–P

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