New RFS Pathway Petitions: Detailed Summary of EPA’s New Guidance and Procedures

As reported in a previous blog entry, the U.S. Environmental Protection Agency announced on September 30, 2014 that it had completed its review of the New Pathway Petition process under the Renewable Fuel Standard. In yesterday’s post, I summarized what EPA has done and briefly analyzed the new Guidance that Agency has issued to help applicants prepare new petitions. Today’s entry provides a more complete section-by-section analysis of the Guidance document.

EPA created a greatly-improved website with information on many aspects of the petition program. The site features easily-understood menus with links to guidance on the petition process, information about the regulations governing new pathways, and the web pages listing approved and pending petitions. The new website includes a page entitled “How to Submit a Complete Petition”, which includes links to a new guidance document for industry, with detailed instructions for how to prepare new pathway petitions, which can now be submitted electronically via EPA’s web server. Also posted on the web is a screening tool, in the form of a spreadsheet that the agency wants companies to use to submit the data needed for EPA to complete the life cycle analysis of the pathway that is required under the regulations.

The following is a summary of the sections included in the new Guidance document, along with brief explanations of what each section entails. Much of the requested information would have reasonably been expected to be required from a reading of the applicable regulations, but there does appear to be certain requested information that would not have been obvious from the prior guidance. In any event, having this Guidance document available to provide a format and organization for the requested data will be very helpful for future petitioners.

A. Cover Sheet. The document provides the format for a simple cover sheet, that is to include basic information about the company and the fuel type (i.e., category of RIN proposed). The document also gives guidance for how to prepare the cover sheet and the petition if there are multiple applicants.

B. Technical Justification. In a section that EPA requests not contain any confidential business information, the agency suggests including the following information:

• A complete narrative description of the process, sufficient to give the reader a clear understanding of what is proposed.
• An executive summary of the pathway (no longer than 1-2 pages).
• A process flowchart for each fuel type requested (non-confidential; applicants can include a confidential version as an attachment or appendix).
• Comparison to other pathways previously reviewed by EPA.
• Justification of commercial viability, which will help EPA prioritize and triage petitions.
• Information on historical (5 years previous requested) and projected (10 years recommended) fuel volumes.

Although most of this information is as expected, and is consistent with earlier guidance from the Agency, I believe the requirement in the final bullet is new, and may pose difficulties for companies early in development. EPA had previously given guidance to companies to file petitions as early as possible, but if several years of operating data are required, this would defeat the purpose of the RFS in promoting development of novel early-stage technologies not previously on the market.

C. Organizational information. Basic information about the company and the identity and contact information for the corporate officer who will be the point of contact for the submission.

D. Fuel Type. In addition to a Technical Description for each fuel type proposed (a brief description of each fuel, no more than 1-2 paragraphs for novel fuel types, much shorter for fuel types already reviewed by EPA), EPA requests the following information:

• Chemical composition of the fuel, based on actual sampling and lab testing; demonstrating that it meets applicable specifications.
• Justification for meeting the regulatory definition (i.e., does feedstock meet the statutory definition; is GHG reduction threshold met?)
• Provide recommended equivalence value for the fuel, under Section 80.1415 of the regulations.
• Describe certification status under 40 CFR Part 79, or ASTM process re jet fuel.

I don’t believe it was clear from EPA’s previous guidance that the Agency wanted to see information on the chemical composition of the fuel, much less evidence based on actual testing that the fuel met the applicable specification, although this is a reasonable thing for the agency to request. Along with the requested historical information on the process, this implies that the Agency now prefers to see applicants file petitions once they are already in production, as opposed to their previous advice to file petitions early.

E. Production Process. The following information is requested about the production process. The document indicates that, for process types EPA has not previously evaluated, it will need a greater amount of information to perform its lifecycle GHG analysis than for those that are variations on more familiar, previously-approved pathways .

• Type of Production Process. A brief explanation of each process, no more than 1-3 sentences for process technologies EPA has previously evaluated; no more than 1-2 pages for new technologies.
• Mass and Energy Balances, using EPA-supplied spreadsheet. Note that there does not appear to be any explicit provision that the company perform its own LCA, but this would be implied by the need to develop the mass and energy balance information that is requested, and also the requirement of proving that the applicable GHG emission reduction threshold has been met.
• Historical Process Data – requesting at least 2 years of data to support mass and energy balances, although the applicant can explain why such data is not available.
• Other information about the process, which EPA states may be shared with DOE, USDA as needed for review of the petition. This could Include information on “energy saving technologies” or other process improvements inherent in the pathway, special provisions (which would presumably include limitations needed to achieve the needed greenhouse gas emission reduction), info on use of input fuels which themselves might be approved under RFS, letters of support from experts and other third parties, etc.

F. Feedstock. Very detailed information about the feedstock, including genus/species, chemical composition, category, volume of feedstock to be used, market projections, market value, land use, invasiveness, etc. The requested information includes:

• Type of Feedstock. A brief description of the feedstock, recommended not to contain confidential information.
• Detailed information for new feedstocks, including a technical definition (genus and species, chemical composition), identification of the category of renewable biomass for which the feedstock qualifies; volume of fuel projected to be produced from the feedstock, including modeling of the market potential of the fuel; estimates of the yields of fuel from the feedstock; land use data; market value of the feedstock; possible alternate uses for the feedstock; farm input data; mass and energy balances for feedstock pre-processing; and information on the potential invasiveness and other potential environmental impacts of the species used as feedstock. This data too may be shared with USDA or DOE as appropriate.

G. Co-Products. Similar (but less extensive) information is requested regarding any co-products that might arise from the pathway. This specifically includes a technical description of each co-product, the estimated market value of the co-product, and some additional information for co-products intended to be used as animal feed. This section will likely not be applicable to Joule.

H. Attachments. Any attachments to the petition would be included in this Section H.

Overall, I believe the new Guidance document will be very useful for companies seeking to have new pathways approved under the RFS. Over the next few weeks, I’ll be preparing the talk on this new petition process that I’ll be giving at the at the BIO Pacific Rim conference this coming December, and during that time I plan to speak to EPA representatives to clarify some questions about this new guidance. I’ll report on what I learn, and I’ll also plan to post additional information about my talk as the date gets closer. Please look for tomorrow’s post for a more detailed section-by-section summary of the new Guidance document.

D. Glass Associates, Inc.is a consulting company specializing in government and regulatory affairs support for renewable fuels and industrial biotechnology. David Glass, Ph.D. is a veteran of over thirty years in the biotechnology industry, with expertise in industrial biotechnology regulatory affairs, U.S. and international renewable fuels regulation, patents, technology licensing, and market and technology assessments. More information on D. Glass Associates’ regulatory affairs consulting capabilities, and copies of some of Dr. Glass’s prior presentations on biofuels and biotechnology regulation, are available at www.slideshare.net/djglass99 and at www.dglassassociates.com. The views expressed in this blog are those of Dr. Glass and D. Glass Associates and do not represent the views of any other organization with which Dr. Glass is affiliated. Please visit our other blog, Biofuel Policy Watch.

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New RFS Pathway Petitions: Analysis of EPA’s New Guidance and Procedures

As reported in the previous blog entry, the U.S. Environmental Protection Agency announced on September 30, 2014 that it had completed its review of the New Pathway Petition process under the Renewable Fuel Standard. Today’s entry will summarize what EPA has done and briefly analyze the new Guidance that Agency has issued to help applicants prepare new petitions. Tomorrow I’ll post a more complete section-by-section analysis of the Guidance document.

As I described in an earlier blog post, many developers of novel renewable fuels need to petition EPA to have their production pathway approved as meeting the requirements of the RFS. I reported in a March 20, 2014 blog entry that EPA issued a Program Announcement in March 2014 to say that it was initiating activities to improve the petition process for new RFS fuel pathways, to enable more timely and efficient decision-making, and to provide improved guidance to companies considering submitting new petitions, to try to substantially reduce the large backlog and long processing times for pending petitions. The agency asked companies to voluntarily hold off on submitting new petitions during this process, which was expected to take 6 months, a time frame which was indeed met by last month’s announcement.

One significant outcome of the agency’s review has been creation of a greatly-improved website with information on many aspects of the petition program. This can be found at http://www.epa.gov/otaq/fuels/renewablefuels/new-pathways. The site features easily-understood menus with links to guidance on the petition process, information about the regulations governing new pathways, and the web pages listing approved and pending petitions. The new website includes a page entitled “How to Submit a Complete Petition”, which includes links to a new guidance document for industry, with detailed instructions for how to prepare new pathway petitions, which can now be submitted electronically via EPA’s web server. Also posted on the web is a screening tool, in the form of a spreadsheet that the agency wants companies to use to submit the data needed for EPA to complete the life cycle analysis of the pathway that is required under the regulations.

Some of the key aspects of the new Guidance document are as follows:

• The new document is very thorough, but is also fairly clear on the requirements for new pathway petitions.
• The Guidance covers many different possible scenarios (e.g., multiple applicants, petitions from feedstock developers rather than fuel producers), and so several of its sections may not be applicable to all petitioners.
• The requested information largely conforms to information previously believed to be required from the regulations and EPA’s website, but nevertheless will be beneficial to submitters in clearly specifying the data EPA wants to see, and the format in which to present it.
• As laid out in the Guidance document, it appears that a significant amount of information and data may be required in a petition, particularly for pathways involving agricultural crops as novel feedstocks. It is not clear how these newly-specified requirements  will affect the ability of small, early-stage companies to submit successful petitions.
• Petitions can now be submitted via EPA’s central data server, by e-mail, or in hard copy.

Analysis

The document provides clear guidance for the information needed in a petition and how EPA expects the information to be presented and formatted. However, not all portions of the requested information might apply to all applicants, and so prior consultation with EPA would be recommended for most applicants. Further, the document clarifies some issues that were somewhat unclear under the previous system: for example clarifying the levels of detail needed for various pieces of information, and clarifying how an applicant might request an approval that depends on specific limitations or provisions for the pathway that are needed to achieve the threshold greenhouse gas reduction levels.

One potentially troubling aspect is that the document seems to be requiring a substantial amount of prior operating data for new pathways, projections of production volumes several years into the future, and (with regard to agricultural feedstocks) detailed information on markets and production needs. One can understand why EPA might want such data, but it begs the question of whether this will pose a difficult burden for early-stage companies that might not have such historical data or the resources to develop the requested production and market forecasts. Presumably EPA will have some flexibility on these and other aspects of the requested data.

Overall, I believe the new Guidance document will be very useful for companies seeking to have new pathways approved under the RFS. Over the next few weeks, I’ll be preparing the talk on this new petition process that I’ll be giving at the at the BIO Pacific Rim conference this coming December, and during that time I plan to speak to EPA representatives to clarify some questions about this new guidance. I’ll report on what I learn, and I’ll also plan to post additional information about my talk as the date gets closer. Please look for tomorrow’s post for a more detailed section-by-section summary of the new Guidance document.

D. Glass Associates, Inc.is a consulting company specializing in government and regulatory affairs support for renewable fuels and industrial biotechnology. David Glass, Ph.D. is a veteran of over thirty years in the biotechnology industry, with expertise in industrial biotechnology regulatory affairs, U.S. and international renewable fuels regulation, patents, technology licensing, and market and technology assessments. More information on D. Glass Associates’ regulatory affairs consulting capabilities, and copies of some of Dr. Glass’s prior presentations on biofuels and biotechnology regulation, are available at www.slideshare.net/djglass99 and at www.dglassassociates.com. The views expressed in this blog are those of Dr. Glass and D. Glass Associates and do not represent the views of any other organization with which Dr. Glass is affiliated. Please visit our other blog, Biofuel Policy Watch.

EPA Completes Review of RFS Pathway Petition Process; Publishes New Industry Guidance

On Tuesday this week, September 30, EPA announced (without much fanfare) that they had completed their review of the New Pathway Petition process under the Renewable Fuel Standard, and that it was issuing new guidance to companies to assist in the preparation and submission of new petitions (many developers of novel renewable fuels need to petition EPA to have their production pathway approved as meeting the requirements of the RFS; see this earlier blog post for more background info). As I reported in a March 20, 2014 blog entry, EPA issued a Program Announcement in March to say that it was initiating activities to improve the petition process for new RFS fuel pathways.  At that time, EPA said that it found “that improvements should be made to the petition process to enable more timely and efficient decision-making” in the RFS program, particularly including improved guidance to companies considering submitting new petitions, and with the goal of substantially reducing the large backlog and long processing times for pending petitions. The agency asked companies to voluntarily hold off on submitting new petitions during this process, which was expected to take 6 months, a time frame which was indeed met by this week’s announcement.

One significant outcome of the agency’s review has been creation of a greatly-improved website with information on many aspects of the petition program. This can be found at http://www.epa.gov/otaq/fuels/renewablefuels/new-pathways. The site features easily-understood menus with links to guidance on the petition process, information about the regulations governing new pathways, and the web pages listing approved and pending petitions. Most importantly, EPA has issued a new guidance document for industry, with detailed instructions for how to prepare new pathway petitions, which can now be submitted electronically via EPA’s web server. Also posted on the web is a screening tool, in the form of a spreadsheet that the agency wants companies to use to submit the data needed for EPA to complete the life cycle analysis of the pathway that is required under the regulations.

I have only just begun to review the Guidance document and the other new materials. I plan to post a more detailed summary and analysis of the guidance document within the next 1-2 weeks. Also, I will be discussing and analyzing this new policy at a talk at the BIO Pacific Rim conference this coming December (the talk will also cover the petition process under the California Low Carbon Fuel Standard). So please look for further blog posts this fall as I continue to study and familiarize myself with this new guidance, and as I prepare my presentation for December.

D. Glass Associates, Inc.is a consulting company specializing in government and regulatory affairs support for renewable fuels and industrial biotechnology. David Glass, Ph.D. is a veteran of over thirty years in the biotechnology industry, with expertise in industrial biotechnology regulatory affairs, U.S. and international renewable fuels regulation, patents, technology licensing, and market and technology assessments. More information on D. Glass Associates’ regulatory affairs consulting capabilities, and copies of some of Dr. Glass’s prior presentations on biofuels and biotechnology regulation, are available at www.slideshare.net/djglass99and at www.dglassassociates.com. The views expressed in this blog are those of Dr. Glass and D. Glass Associates and do not represent the views of any other organization with which Dr. Glass is affiliated. Please visit our other blog, Biofuel Policy Watch.