O. Reg. 227/18: ETHANOL IN GASOLINE

filed April 10, 2018 under Environmental Protection Act, R.S.O. 1990, c. E.19

ontario regulation 227/18

made under the

Environmental Protection Act

Made: March 7, 2018
Filed: April 10, 2018
Published on e-Laws: April 10, 2018
Printed in The Ontario Gazette: April 28, 2018

Amending O. Reg. 535/05

(ETHANOL IN GASOLINE)

1. The title to Ontario Regulation 535/05 is revoked and the following substituted:

Greener Gasoline — bio-based content requirements for gasoline

2. (1) Subsection 1 (1) of the Regulation is amended by adding the following definition:

“bio-based content” means, subject to subsection (1.0.1),

(a) any material that is derived from biological matter that is available on either a renewable or recurring basis, or

(b) ethyl alcohol that is derived from renewable or recurring sources and any denaturant that has been added to it;

(2) The definition of “blend” in subsection 1 (1) of the Regulation is amended by striking out “oxygenates” and substituting “bio-based content”.

(3) Subsection 1 (1) of the Regulation is amended by adding the following definitions:

“blended gasoline” means a combination of gasoline and bio-based content;

“blendstock” means a fossil-based substance that is not suitable for use in a spark ignition engine until combined with an oxygenate;

(4) The definitions of “cellulosic ethanol”, “ethanol” and “ethanol-blended gasoline” in subsection 1 (1) of the Regulation are revoked.

(5) The definition of “facility” in subsection 1 (1) of the Regulation is revoked and the following substituted:

“facility” means,

(a) a site, vehicle, vessel or other place where a fuel supplier undertakes the manufacture of gasoline or blended gasoline, or

(b) a site, vehicle, vessel or other place where gasoline or blended gasoline is received pursuant to an inter-refiner agreement;

(6) The definition of “fuel supplier” in subsection 1 (1) of the Regulation is amended by,

(a) striking out “manufactures or blends gasoline” in clause (a) and substituting “manufactures gasoline or blended gasoline”;

(b) adding “or blended gasoline” after “gasoline” in clause (b); and

(7) The definition of “gasoline” in subsection 1 (1) of the Regulation is amended by striking out “liquid product of petroleum” in the portion before clause (a) and substituting “fossil-derived liquid”.

(8) Subsection 1 (1) of the Regulation is amended by adding the following definitions:

“GHGenius model” has the same meaning as in Ontario Regulation 97/14 (Greener Diesel — Bio-Based Content Requirements for Diesel Fuel) made under the Act;

“greenhouse gas intensity” means the greenhouse gas emissions, expressed in grams of carbon dioxide equivalent emissions per megajoule of energy, that are attributable to a substance as quantified under,

(a) the GHGenius model, or

(b) another methodology if the Director provides the methodology for the substance under subsection 3.1 (3);

(9) The definition of “inter-refiner agreement” in subsection 1 (1) of the Regulation is amended by adding “or blended gasoline” after “gasoline”.

(10) The definition of “manufacture” in subsection 1 (1) of the Regulation is revoked and the following substituted:

“manufacture” means to produce gasoline or blended gasoline, but does not include modification of gasoline or blended gasoline solely by the addition of additives;

(11) Subsection 1 (1) of the Regulation is amended by adding the following definitions:

“Northern Ontario” means all those parts of Ontario lying north and west of the Mattawa River, Lake Nipissing and the French River, including the Territorial District of Manitoulin;

“professional engineer” means a person who holds a licence, limited licence, provisional licence or temporary licence under the Professional Engineers Act;

(12) Section 1 of the Regulation is amended by adding the following subsection:

(1.0.1) For the purposes of the definition of “bio-based content” in subsection (1), bio-based content does not include solid municipal waste that contains,

(a) source separated organics, except for residues generated by the processing of the waste;

(b) compost produced by composting;

(d) leaf and yard waste collected or accepted by a leaf and yard waste system to which section 13 of Ontario Regulation 101/94 (Recycling and Composting of Municipal Waste) made under the Act applies, except for residues generated by the composting of the waste at a leaf and yard waste composting site as defined in Part V of that Regulation.

(13) Subsections 1 (2), (3), (4) and (5) of the Regulation are amended by adding “or blended gasoline” after “gasoline” wherever it appears.

3. (1) Subsection 2 (1) of the Regulation is revoked and the following substituted:

Blended gasoline quality

(1) No person shall distribute blended gasoline for use or sale in Ontario unless the blended gasoline meets the standards and specifications set out in the following documents as applicable to the type of fuel:

1. Canadian General Standards Board (CGSB) document CAN/CGSB-3.511, as amended from time to time.

2. Canadian General Standards Board (CGSB) document CAN/CGSB-3.5, as amended from time to time.

3. Canadian General Standards Board (CGSB) document CAN/CGSB-3.512, as amended from time to time.

4. An equivalent set of standards and specifications that is approved in writing by the Director before the blended gasoline is distributed.

(2) Subsection 2 (2) of the Regulation is revoked.

(3) Subsection 2 (4) of the Regulation is amended by adding “or blended gasoline” after “gasoline”.

(4) Subsection 2 (5) of the Regulation is amended by striking out “or (2), as the case may be” at the end.

4. Section 3 of the Regulation is revoked and the following substituted:

Minimum bio-based content

3. Every fuel supplier shall ensure that the gasoline and blended gasoline it places in the Ontario market for each compliance year after 2019 contains an average adjusted volume of bio-based content of at least 10 per cent calculated in accordance with the applicable compliance formula in section 4.

Rules for applying compliance formulas

3.1 (1) In calculating “y” for the purposes of the formulas in section 4, the fuel supplier shall,

(a) comply with any written directions made by the Director under subsection (2); and

(b) ensure that a professional engineer is of the opinion that,

(i) the primary data used is reasonable, and

(ii) the calculation is correct.

(2) The Director may issue written directions as to the manner in which the following types of data are to be input into the GHGenius model:

1. Primary data, consisting of quantified values of products, materials or energy flows that enter and leave a production process or activity, directly measured, calculated or obtained and based on specific original source measurements.

2. Secondary data, consisting of quantified values of products, materials or energy flows that enter and leave a production process or activity, indirectly measured, calculated or obtained and not based on specific original source measurements.

(3) If a fuel supplier wishes to use bio-based content that is not listed in the GHGenius model, the fuel supplier shall request that the Director provide a methodology for calculating the greenhouse gas intensity of that bio-based content and the fuel supplier shall use the methodology the Director provides.

(4) For the purposes of calculating the formulas under section 4, any portions of the volume of bio-based content in blended gasolines placed in the Ontario market in a compliance year that have been transferred from the records of one fuel supplier to the records of another fuel supplier within the same compliance year may be included.

(5) For the purposes of the formulas in section 4, the following categories of gasoline or blended gasoline may be deducted from the total amount of gasoline or blended gasoline placed in the Ontario market in a compliance year, if the fuel supplier so elects and can establish, by written evidence, that the gasoline or blended gasoline was distributed for those purposes:

1. Gasoline or blended gasoline placed in the Ontario market in the same compliance year for the purposes of generating power in aircraft, marine vessels or equipment, off-road vehicles or equipment, or vehicles manufactured prior to 1980.

2. Gasoline or blended gasoline that has an antiknock index of 89 or greater placed in the Ontario market in the same compliance year, if the gasoline or blended gasoline is not included in the category described in paragraph 1.

(6) For the purposes of the formula in subsection 4 (1), the following category of gasoline or blended gasoline may be deducted from the total amount of gasoline or blended gasoline placed in the Ontario market in a compliance year, if the fuel supplier so elects and can establish, by written evidence, that the gasoline or blended gasoline was distributed for those purposes:

1. Gasoline and blended gasoline that the fuel supplier distributed to, from or within Northern Ontario in the same compliance year.

5. Section 4 of the Regulation is revoked and the following substituted:

Compliance formulas

4. (1) For the 2020, 2021 and 2022 compliance years, the following formula shall be used to calculate the average adjusted volume of bio-based content:

[{C [(83.9 − y) / 37.8] + D − E} / (A + B − F − G − H)] × 100

in which,

“A” is the volume of blended gasolines that the fuel supplier placed in the Ontario market in the compliance year,

“B” is the volume of non-blended gasolines that the fuel supplier placed in the Ontario market in the compliance year,

“C” is the volume of bio-based content contained in “A”,

“D” is the volume of bio-based content transferred from the records of other fuel suppliers within the same compliance year,

“E” is the volume of bio-based content transferred to the records of other fuel suppliers within the same compliance year,

“F” is the volume of blended gasolines and non-blended gasolines placed in the Ontario market in the compliance year for the purposes of generating power in aircraft, marine vessels or equipment, off-road vehicles or equipment or vehicles manufactured prior to 1980, if the fuel supplier has made an election under subsection 3.1 (5),

“G” is the volume of gasolines or blended gasolines that have an antiknock index of 89 or greater placed in the Ontario market in the compliance year and that is not included in the definition of “F”, if the fuel supplier has made an election under subsection 3.1 (5),

“H” is the volume of gasolines and blended gasolines distributed from or sold in Northern Ontario in the compliance year, if the fuel supplier has made an election under subsection 3.1 (6), and

“y” is the greenhouse gas intensity of the bio-based content in blended gasolines that the fuel supplier placed in the Ontario market during the compliance year, calculated on a weighted average basis by volume.

(2) For any compliance year after the 2022 compliance year, the following formula shall be used to calculate the average adjusted volume of bio-based content:

[{C [(83.9 − y) / 37.8] + D − E} / (A + B − F − G)] × 100

in which,

“A” is the volume of blended gasolines that the fuel supplier placed in the Ontario market in the compliance year,

“B” is the volume of non-blended gasolines that the fuel supplier placed in the Ontario market in the compliance year,

“C” is the volume of bio-based content contained in “A”,

“D” is the volume of bio-based content transferred from the records of other fuel suppliers within the same compliance year,

“E” is the volume of bio-based content transferred to the records of other fuel suppliers within the same compliance year,

6. (1) Subsection 5 (1) of the Regulation is amended by striking out “after 2007”.

(2) Subsection 5 (2) of the Regulation is amended by striking out “be in a form acceptable to the Director, and shall” in the portion before clause (a).

(3) Clause 5 (2) (b) of the Regulation is amended by striking out “subsection 4 (1)” and substituting “section 4”.

(4) Clause 5 (2) (d) of the Regulation is amended by adding “or blended gasoline” after “gasoline”.

(5) Subsection 5 (2) of the Regulation is amended by striking out “and” at the end of clause (d) and by adding the following clause:

(d.1) in the case of a fuel supplier who elects to deduct gasoline or blended gasoline placed in the Ontario market in the compliance year having an antiknock index of 89 or greater and not otherwise deducted as described in clause (d), a statement to that effect; and

(6) Clause 5 (2) (e) of the Regulation is amended by striking out “subsection 4 (1)” at the end and substituting “section 4”.

(7) Section 5 of the Regulation is amended by adding the following subsection:

(2.1) The report filed in 2020 respecting the 2019 compliance year shall include the information required by this Regulation as it read on December 31, 2019 and is not required to include the information required by this Regulation as it read on January 1, 2020.

(8) Subsections 5 (3) and (4) of the Regulation are revoked.

7. (1) Subsection 6 (1) of the Regulation is amended by adding “or blended gasoline” after “gasoline” in the portion before clause (a).

(2) Clause 6 (1) (a) of the Regulation is amended by striking out “subsections 4 (1) and 5 (3)” and substituting “section 4”.

(3) Clause 6 (1) (b) of the Regulation is amended by striking out “ethanol-blended gasolines, non-ethanol-blended gasolines, ethanol, or blendstock” and substituting “blended gasolines, non-blended gasolines, bio-based content or blendstock”.

(4) Clause 6 (1) (c) of the Regulation is revoked and the following substituted:

(c) dated contracts, records of transfer, invoices and records of payment for volumes of bio-based content that are transferred between the records of fuel suppliers.

8. Section 7 of the Regulation is revoked and the following substituted:

Giving or submitting records

7. (1) In this Regulation, if a notice, report, statement or other document is required to be given or submitted, other than a document required to be given or submitted by the Director, the notice, report, statement or other document shall be submitted in a form provided by or approved by the Director and in a manner approved by the Director.

(2) The Director may require that a document or other record that is given to the Director under this Regulation be given in an electronic format specified by the Director.

Commencement

9. (1) Subject to subsection (2), this Regulation comes into force on the day it is filed.

(2) Sections 1 to 8 come into force on January 1, 2020.

O. Reg. 227/18: ETHANOL IN GASOLINE

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