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EPA Lifecycle Analysis of Greenhouse

Gas Emissions from Renewable Fuels

BackgroundAs part o revisions to the National Renewable Fuel Standard program (commonlyknown as the RFS program) as mandated in the Energy Independence and SecurityAct o 2007 (EISA), EPA has analyzed liecycle greenhouse gas (GHG) emissions

rom increased renewable uels use. EISA established eligibility requirements or

renewable uels, including the frst U.S. mandatory liecycle GHG reduction thresholds,which determine compliance with our renewable uel categories. The regulatorypurpose o EPAs liecycle GHG emissions analysis is thereore to determine whetherrenewable uels produced under varying conditions meet the GHG thresholds or thedierent categories o renewable uel. Determining compliance with the thresholdsrequires a comprehensive evaluation o renewable uels, as well as o gasoline anddiesel, on the basis o their liecycle emissions.

EISA defnes liecycle GHG emissions as ollows:

The term liecycle greenhouse gas emissions means the aggregate quantity ogreenhouse gas emissions (including direct emissions and signifcant indirectemissions such as signifcant emissions rom land use changes), as determined bythe Administrator, related to the ull uel liecycle, including all stages o uel andeedstock production and distribution, rom eedstock generation or extractionthrough the distribution and delivery and use o the fnished uel to the ultimate

consumer, where the mass values or all greenhouse gases are adjusted to accountor their relative global warming potential.1

EISA established specifc liecycle GHG emission thresholds or each o our typeso renewable uels, requiring a percentage improvement compared to liecycle GHG

emissions or gasoline or diesel (whichever is being replaced by the renewable uel)sold or distributed as transportation uel in 2005. EISA required a 20% reductionin liecycle GHG emissions or any renewable uel produced at new acilities (those

1 Clean Air Act Section 211(o)(1)

Ofce o Transportation and Air Quality

EPA-420-F-10-006

February 2010

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constructed ater enactment), a 50% reduction in order to be classifed as biomass-based diesel or

advanced biouel, and a 60% reduction in order to be classifed as cellulosic biouel.

Threshold Determinations

EPA is making threshold determinations based on a methodology that includes an analysis o

the ull liecycle o various uels, including emissions rom international land-use changes result-ing rom increased biouel demand. EPA has used the best available models or this purpose,and has incorporated many modifcations to its proposed approach based on comments rom thepublic, a ormal peer review, and developing science. EPA has also quantifed the uncertainty associated with signifcant components o its analyses, including important actors aecting GHGemissions associated with international land use change. EPA is confdent that its modeling oGHG emissions associated with international land use is comprehensive and provides a reason-

able and scientifcally robust basis or making threshold determinations. Based on this analysis,EPA is determining that:

Ethanolproducedfromcornstarchatanewnaturalgas,biomass,orbiogasredfacility(or expanded capacity rom such a acility) using advanced efcient technologies (onesthat we expect will be most typical o new production acilities) will meet the 20% GHGemission reduction threshold compared to the 2005 gasoline baseline.

Biobutanolfromcornstarchalsomeetsthe20%threshold.

Biodieselandrenewabledieselfromsoyoilorwasteoils,fats,andgreaseswillmeetthe50% GHG threshold or biomass-based diesel compared to the 2005 petroleum dieselbaseline.

Biodieselandrenewabledieselproducedfromalgaloilswillalsocomplywiththe50%threshold should they reach commercial production.

Ethanolfromsugarcanecomplieswiththeapplicable50%reductionthresholdforadvanced

biouels. Forcellulosicethanolandcellulosicdiesel,thepathwaysmodeledinouranalysis(for

eedstock and production technology) would comply with the 60% GHG reduction

threshold or cellulosic biouel. DeterminationsforadditionalfuelsandfuelpathwayscanbefoundinSectionVofthe

preamble.

In addition to fnalizing threshold compliance determinations or pathways that we specifcallymodeled, as shown above, in some cases our technical judgment indicates that other pathwaysare likely to be similar enough that we can extend these determinations. These include uelsthat are produced rom fve categories o eedstocks similar to those already modeled and which

are expected to have less or no indirect land use change:

1. Crop residues such as corn stover, wheat straw, rice straw, citrus residue2. Forest material including eligible orest thinnings and solid residue remaining rom orest

product production3. Secondary annual crops planted on existing crop land such as winter cover crops4. Separated ood and yard waste including biogenic waste rom ood processing5. Perennial grasses including switchgrass and miscanthus

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Threshold determinations or certain other pathways were not possible at this time because

sufcient modeling or data is not yet available. In some o these cases, we recognize that whilea renewable uel is already being produced rom an alternative eedstock and we have the dataneeded or analysis, we did not have sufcient time to complete the necessary liecycle GHGimpact assessment or this fnal rule. EPA anticipates modeling grain sorghum ethanol, woodypulp ethanol, and palm oil biodiesel ater this fnal rule and including the determinations in arulemaking within 6 months.

For other uels, we are establishing a process whereby a biouel producer or importer can petitionthe Agency to also consider whether a uel pathway would be eligible or use in complying with

an EISA standard. EPA will use the data supplied in the petition to evaluate whether the inor-mation or the uel pathway, combined with inormation developed in this rulemaking or otheruel pathways, is sufcient to allow EPA to determine whether the new uel pathway qualifes.EPA will process these petitions as expeditiously as possible, taking into consideration that someuel pathways are closer to the commercial production stage than others.

Our AnalysisIn order to calculate the liecycle GHG emissions o various uels, EPA utilized models thattake into account energy and emissions inputs or uel and eedstock production, distribution,and use, as well as economic models that predict changes in agricultural markets. In developing

this analysis, the Agency employed a collaborative, transparent, and science-based approach.Through technical outreach, the peer review process, and the public comment period, EPAreceived and reviewed a signifcant amount o data, studies, and inormation on our proposedliecycle analysis approach. We incorporated a number o new, updated, and peer-reviewed datasources in our fnal rulemaking analysis, including better satellite data or tracking land usechanges and improved assessments o N2O impacts rom agriculture.

We also perormed dozens o new modeling runs, uncertainty analyses, and sensitivity analyseswhich are leading to greater confdence in our results. We have updated our analyses in conjunc

tion with, and based on, advice rom experts rom government, academia, industry, and not orproft institutions.

The new studies, data, and analysis perormed or the fnal rulemaking impacted the liecycleGHG results or biouels in a number o dierent ways. In some cases, updates caused the mod-eled analysis o liecycle GHG emissions rom biouels to increase, while other updates causedthe modeled emissions to be reduced. Overall, the revisions since our proposed rule have led toa reduction in modeled liecycle GHG emissions as compared to the values in the proposal. For

example, or corn ethanol the fnal rule analysis ound less overall indirect land use change (lessland needed), thereby improving the liecycle GHG perormance o corn ethanol. The mainreasons or this decrease are:

Basedonnewstudiesthatshowtherateofimprovementincropyieldsasafunctionofprice, crop yields are now modeled to increase in response to higher crop prices. Whenhigher crop yields are used in the models, less land is needed domestically and globallyor crops as biouels expand.

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Newresearchavailablesincetheproposalindicatesthatdistillersgrainsandsolubles

(DGS), a corn ethanol production co-product, is more efcient as an animal eed (meaning less corn is needed or animal eed) than we had assumed in the proposal. Thereore,in our analyses or the fnal rule, domestic corn demand and exports are not impacted asmuch by increased biouel production as they were in the proposal analysis.

Improvedsatellitedataallowedustomorenelyassessthetypesoflandconvertedwheninternational land use changes occur, and this more precise assessment led to a lower-ing o modeled GHG impacts. Based on previous satellite data, the proposal assumedcropland expansion onto grassland would require an amount o pasture to be replaced

through deorestation. For the fnal rulemaking analysis we incorporated improved satel-lite data, as well as improved economic modeling o pasture demand, and ound that pasture is also likely to expand onto existing grasslands. This reduced the GHG emissionsassociated with an amount o land use change.

Next Steps/Future WorkWhile EPA is using its current liecycle assessments to inorm regulatory determinations in thisfnal rule, as required by EISA, we also recognize that as the state o scientifc knowledge con-tinues to evolve in this area, the liecycle GHG assessments or a variety o uel pathways willcontinue to be enhanced. Thereore, the Agency is committing to urther reassess these determi

nations and liecycle estimates. As part o this ongoing eort, we will ask or the expert adviceo the National Academy o Sciences, as well as other experts, and incorporate their adviceand any updated inormation we receive into a new assessment o the liecycle GHG emissionsperormance o the biouels being evaluated in this fnal rule. EPA will request that the NationaAcademy o Sciences evaluate the approach taken in this rule, the underlying science o lie-cycle assessment, and in particular indirect land use change, and make recommendations orsubsequent liecycle GHG assessments on this subject. This new assessment could result in new

determinations o threshold compliance compared to those included in this rule. These wouldapply to uture production rom plants that are constructed ater each subsequent rule incorpo-rating a revised liecycle assessment methodology.

Additional detail on the dierent components o EPAs liecycle analysis can be ound in thepreamble and the Regulatory Impact Analysis that accompany the Final Rule.

For More InformationFor more inormation on this proposal, please contact EPAs Ofce o Transportation and Air

Quality, Assessment and Standards Division inormation line at:U.S. Environmental Protection AgencyOfce o Transportation and Air Quality2000 Traverwood DriveAnn Arbor, MI 48105Voicemail:(734)214-4636E-mail: asdino@epa.gov

Or visit: www.epa.gov/otaq/renewableuels/index.htm