Winston
H.
Hickox
Agency
Secretary
The
energy
challenge
facing
California
is
real.
Every
Californian
needs
to
take
immediate
action
to
reduce
energy
consumption.
For
a
list
of
simple
ways
you
can
reduce
demand
and
cut
your
energy
costs,
see
our
Website:
http://
www.
arb.
ca.
gov.

California
Environmental
Protection
Agency
Printed
on
Recycled
Paper
Air
Resources
Board
Alan
C.
Lloyd,
Ph.
D.
Chairman
1001
I
Street
°
P.
O.
Box
2815
°
Sacramento,
California
95812
°
www.
arb.
ca.
gov
Gray
Davis
Governor
March
21,
2001
VIA
FACSIMILE
Anne
Pastorkovich
Attorney/
Advisor
U.
S.
Environmental
Protection
Agency
Fuels
and
Energy
Division
401
M
Street,
SW
(
6406J)
Washington,
D.
C.
20460
Re:
California
Enforcement
Exemption
and
the
Early
Sale
of
Phase
3
California
Reformulated
Gasoline
Dear
Ms.
Pastorkovich:

This
is
a
follow­
up
to
our
telephone
conversation
today
in
which
I
advised
you
of
refiner
interest
in
producing
in
the
near
future
California
gasoline
subject
to
the
new
Phase
3
California
reformulated
gasoline
(
Phase
3
CaRFG)
standards.
We
request
that
the
U.
S.
Environmental
Protection
Agency
(
U.
S.
EPA)
initiate
a
rulemaking
to
make
such
gasoline
subject
to
the
California
Enforcement
Exemption
provisions
of
the
federal
reformulated
gasoline
(
RFG)
regulations.
In
the
interim,
we
request
that
EPA
consider
a
policy
of
foregoing
enforcement
of
the
requirements
covered
by
the
California
Enforcement
Exemption
in
the
case
of
California
gasoline
that
meets
all
of
the
Phase
3
CaRFG
standards.
We
believe
that
there
are
sound
reasons
for
doing
so,
and
that
such
a
policy
would
maintain
all
of
the
emission
benefits
of
the
federal
RFG
program.

As
you
know,
the
California
Enforcement
Exemption
in
40
CFR

80.81
exempts
refiners
from
many
of
the
federal
RFG
enforcement
requirements
 
but
not
the
underlying
standards
 
for
gasoline
produced
in
California
and
meeting
the
Phase
2
CaRFG
requirements.
All
California
motor
vehicle
gasoline
has
been
subject
to
the
Phase
2
CaRFG
standards
in
sections
2260
et
seq.,
title
13,
California
Code
of
Regulations
(
CCR)
since
1996.
U.
S.
EPA's
extension
of
the
California
Enforcement
Exemption
beyond
December
31,
1999
was
premised
on
a
determination
that
Phase
2
CaRFG
provides
emissions
benefits
equivalent
to
the
Federal
Phase
II
RFG
standards
that
became
applicable
in
January
2000.
(
64
F.
R.
49992,
49994
(
September
15,
1999).)
Ms.
Anne
Pastorkovich
March
21,
2001
Page
2
The
California
Air
Resources
Board
(
CARB)
adopted
the
Phase
3
CaRFG
standards
in
a
1999­
2000
rulemaking.
Sections
2260­
2273,
title
13,
CCR
contain
both
the
Phase
2
and
Phase
3
CaRFG
requirements,
with
the
actual
standards
contained
in
section
2262.
The
numerical
Phase
2
and
Phase
3
CaRFG
standards
are
shown
in
the
Attachment
1
(
footnotes
have
been
omitted).
The
Phase
3
CaRFG
amendments
also
include
a
Phase
3
CaRFG
Predictive
Model
that
includes
an
evaporative
emissions
element.
All
of
the
Phase
3
CaRFG
rulemaking
documents
can
be
found
on
the
Internet
site
for
the
rulemaking,
http://
www.
arb.
ca.
gov/
regact/
carfg3/
carfg3.
htm.

All
California
gasoline
supplied
from
California
refineries
starting
December
31,
2002
must
meet
the
Phase
3
CaRFG
standards
in
place
of
the
Phase
2
CaRFG
standards.
As
described
on
page
20
of
the
Final
Statement
of
Reasons,
section
2261(
b)(
3)
contains
a
mechanism
under
which
a
refiner
may
request
that
CARB
allow
early
compliance
with
the
Phase
3
CaRFG
standards
before
December
31,
2002.
If
the
refiner
makes
a
satisfactory
demonstration
of
both
an
ability
and
intent
to
produce
gasoline
subject
to
the
CaRFG3
standards,
CARB's
Executive
Officer
will
announce
a
date
after
which
any
refiner
may
produce
batches
of
gasoline
subject
to
the
CaRFG3
standards.
We
expect
to
be
acting
on
such
a
request
from
a
refiner
in
the
near
future.

The
Phase
3
CaRFG
standards
were
adopted
in
response
to
Governor
Gray
Davis's
March
25,
1999
issuance
of
Executive
Order
D­
5­
99,
in
which
he
found
that,
on
balance,
there
is
a
significant
risk
to
the
environment
from
using
methyl
tertiary­
butyl
ether
(
MTBE)
in
gasoline
in
California.
The
objectives
of
the
Phase
3
CaRFG
regulations
were
to
prohibit
the
use
of
MTBE
in
gasoline,
to
provide
flexibility
to
refiners
in
producing
or
importing
California
gasoline
without
MTBE,
to
preserve
the
significant
benefits
from
the
Phase
2
CaRFG
regulations,
and
to
obtain
additional
emissions
reductions
to
the
extent
technologically
feasible
and
economically
reasonable.

In
terms
of
the
California
Enforcement
Exemption,
the
most
important
consideration
was
maintaining
the
emission
benefits
from
the
Phase
2
CaRFG
program.
CARB
was
mandated
by
state
law
to
do
so
 
1999
legislation
signed
by
the
Governor
October
10,
1999
(
Stats.
1999
ch.
812;
S.
B.
989,
Senator
Sher)
required
CARB
to
ensure
that
the
Phase
3
CaRFG
standards
maintain
or
improve
upon
emissions
and
air
quality
benefits
achieved
by
Phase
2
CaRFG
as
of
January
1,
1999.
Our
demonstration
that
the
Phase
3
CaRFG
standards
fully
protect
the
emission
benefits
from
the
Phase
2
CaRFG
standards
is
contained
on
pages
47­
54
of
the
Staff
Report::
Initial
Statement
of
Reasons
and
on
pages
15­
19
and
27­
32
of
the
Final
Statement
of
Reasons.

Because
U.
S.
EPA
has
already
determined
that
the
Phase
2
CaRFG
provides
emissions
benefits
equivalent
to
federal
Phase
II
RFG,
and
CARB
has
demonstrated
that
Phase
3
CaRFG
fully
protects
the
emission
benefits
of
Phase
2
CaRFG,
it
should
follow
that
Phase
3
CaRFG
provides
emissions
benefits
equivalent
to
federal
Phase
II
Ms.
Anne
Pastorkovich
March
21,
2001
Page
3
RFG.
We
believe
this
should
be
adequate
to
justify
extending
the
California
Enforcement
Exemption
to
cover
California
gasoline
meeting
the
Phase
3
CaRFG
standards.
As
is
presently
the
case,
California
gasoline
sold
in
federal
RFG
areas
would
remain
subject
to
the
underlying
federal
Phase
II
RFG
standards.

I
hope
this
provides
enough
information
to
begin
your
analysis
of
our
request.
We
obviously
recognize
that
you
will
have
further
questions
in
this
regard.
You
can
direct
legal
questions
to
me
at
(
916)
323­
9608,
and
technical
questions
to
either
Dean
Simeroth
at
(
916)
322­
6020
or
Steve
Brisby
at
(
916)
322­
6019.

Sincerely,

W.
Thomas
Jennings
Senior
Staff
Counsel
OFFICE
OF
LEGAL
AFFAIRS
Attachment
1
Flat
Limits
Averaging
Limits
Cap
Limits
Property
CaRFG
Phase
2
CaRFG
Phase
3
CaRFG
Phase
2
CaRFG
Phase
3
CaRFG
Phase
2
CaRFG
Phase
3
Reid
Vapor
Pressure1
(
pounds
per
square
inch)
7.00
7.00
or
6.902
Not
Applicable
Not
Applicable
7.003
6.40
­
7.20
604
Sulfur
Content
(
parts
per
million
by
weight)
40
20
30
15
80
304
Benzene
Content
(
percent
by
volume)
1.00
0.80
0.80
0.70
1.20
1.10
Aromatics
Content
(
percent
by
volume)
25.0
25.0
22.0
22.0
30.03
35.0
Olefins
Content
(
percent
by
volume)
6.0
6.0
4.0
4.0
10.0
10.0
T50
(
degrees
Fahrenheit)
210
213
200
203
220
220
T90
(
degrees
Fahrenheit)
300
305
2905
295
330
330
1.86
­
3.5
1.86­
3.57
Oxygen
Content
(
percent
by
weight)
1.8
­
2.2
1.8
­
2.2
Not
Applicable
Not
Applicable
06
­
3.5
06
­
3.57
Methyl
tertiary­
butyl
ether
(
MTBE)
and
oxygenates
other
than
ethanol
Not
Applicable
Prohibited
as
provided
in

2262.6
Not
Applicable
Not
Applicable
Not
Applicable
Prohibited
as
provided
in
2262.6
1
The
Reid
vapor
pressure
standards
apply
only
during
the
warmer
weather
months
identified
in
section
2262.4.
2
The
6.90
psi
standard
applies
only
when
a
producer
or
importer
is
using
the
evaporative
emissions
model
element
of
the
CaRFG
Phase
3
Predictive
Model.
3
For
sales,
supplies,
or
offers
of
California
gasoline
downstream
of
the
production
or
import
facility
starting
on
the
date
on
which
early
compliance
with
the
CaRFG
Phase
3
standards
is
permitted
by
the
executive
officer
under
section
2261(
b)(
3),
the
CaRFG
Phase
2
cap
limits
for
Reid
vapor
pressure
and
aromatics
content
shall
be
7.20
psi
and
35.0
percent
by
volume
respectively.
4
The
CaRFG
Phase
3
sulfur
content
cap
limits
of
60
and
30
parts
per
million
are
phased
in
starting
December
31,
2002,
and
December
31,
2004,
respectively,
in
accordance
with
section
2261(
b)(
1)(
A).
5
Designated
alternative
limit
may
not
exceed
310.
6
The
1.8
percent
by
weight
minimum
oxygen
content
cap
only
applies
during
specified
winter
months
in
the
areas
identified
in
section
2262.5(
a).
7
If
the
gasoline
contains
more
than
3.5
percent
by
weight
oxygen
but
no
more
than
10
volume
percent
ethanol,
the
maximum
oxygen
content
cap
is
3.7
percent
by
weight.
