Executive Summary: The U.S. EPA’s ULSD program is entering its final phase on October 1, 2014 after which only 15-ppm diesel fuel will be allowed for use in highway vehicles and non-road vehicles nationwide. 500-ppm fuel may only be used in locomotive, marine engines. The sulfur content of heating oil is not regulated by the U.S. EPA. The final phase-in of the ULSD program means the elimination of certain regulatory requirements for product transfer document language and dispenser labels.

FINAL PHASE-IN OF EPA ULSD PROGRAM BRINGS CHANGES TO DIESEL FUEL PTD AND DISPENSER LABEL REQUIREMENTS:

The EPA ULSD standard is concluding an eight-year phase-in period required under the EPA’s ultra low sulfur diesel fuel program. The final stage in the program means that 15-ppm dyed non-road diesel fuel and 15-ppm clear highway diesel fuel will be required nationwide. Some higher sulfur distillates remain for locomotive and marine engines as well as heating oil.

The final phase-in also brings along some minor changes to diesel fuel product transfer document requirements and dispenser labels. The regulatory changes primarily involve elimination of PTD language and dispenser labels for 500-ppm diesel fuel. However, there is new language for ECA 1000-ppm marine fuel and a new general requirement to include the sulfur content of the fuel on all PTD language, including heating oil – a practice most heating oil dealers already follow.

The following PTD language is required unless otherwise indicated. Please note that EPA approved a number of alternative language requirements for PTDs. If you are using the alternative language, you may continue to do so.

I. EPA PRODUCT TRANSFER DOCUMENT REQUIREMENTS:

PTD requirements apply on each occasion any person transfers custody or title to MVNRLM diesel fuel, heating oil, or ECA marine fuel except when such fuel is dispensed into motor vehicles or non-road engines, locomotives, marine diesel engines or C3 vessels.

• Dyed 500-ppm Locomotive and Marine Diesel Fuel - Beginning June 1, 2010 and Thereafter:

“500 ppm sulfur (maximum) Dyed Low Sulfur Locomotive and Marine diesel fuel. Not for use in highway or other non-road vehicles and engines.”

• Dyed Heating Oil - Beginning June 1, 2007 and Thereafter:

“XXXX* ppm sulfur (maximum) Heating Oil. Not for use in highway vehicles or engines or nonroad, locomotive, or marine engines.”

*XXXX – fill in the applicable sulfur content

• Undyed 15-ppm Sulfur Diesel Fuel - Beginning June 1, 2006 and Thereafter:

“15 ppm sulfur (maximum) Undyed Ultra-Low Sulfur Diesel Fuel. For use in all diesel vehicles and engines.”

• Dyed 15-ppm Sulfur Diesel Fuel - Beginning June 1, 2006 and Thereafter:

“15 ppm sulfur (maximum) Dyed Ultra-Low Sulfur Diesel Fuel. For use in all nonroad diesel engines. Not for use in highway vehicles or engines except for tax-exempt use in accordance with section 4082 of the Internal Revenue Code.”

• ECA Marine Fuel – Beginning June 1, 2014 and Thereafter:

“1,000 ppm sulfur (maximum) ECA marine fuel. For use in Category 3 marine vessels only. Not for use in engines not installed on C3 marine vessels.”

• 500-ppm Dyed Diesel Fuel- Prohibited Beginning October 1, 2014 and Thereafter:

“500 ppm sulfur (maximum) Dyed Low Sulfur Nonroad Diesel Fuel. For use in model year 2010 and older nonroad diesel engines. May be used in locomotive and marine diesel engines. Not for use in highway vehicles and engines or model year 2011 or later nonroad engines other than locomotive or marine diesel engines. Not for use in the Northeast/Mid-Atlantic Area.''

II. EPA DISPENSER LABEL REQUIREMENTS

Since 500-ppm diesel fuel for highway and non-road vehicles is no longer allowed under the ULSD program, the EPA is eliminating dispenser labels for 500-ppm dispenser labels after September 30, 2014. In addition, beginning November 1, 2014, the 15-ppm highway diesel fuel label is no longer required (the 15-ppm dyed diesel fuel dispenser label was discontinued in 2012). Marketers who wish to maintain the 15-ppm diesel fuel label may do so.

The following dispenser labels are no longer required after the applicable date:

• 15-ppm ULSD – No Longer Required After November 30, 2014:

“ULTRA-LOW SULFUR HIGHWAY DIESEL FUEL (15 ppm Sulfur Maximum)

Required for use in all highway diesel vehicles and engines.

Recommended for use in all diesel vehicles and engines.”

• 500-ppm LSD Non-Highway Diesel Fuel – Prohibited After September 30, 2014:

“LOW SULFUR NON-HIGHWAY DIESEL FUEL (500 ppm Sulfur Maximum)

WARNING

Federal law prohibits use in all model year 2011 and newer nonroad engines.

May damage model year 2011 and newer nonroad engines.

Federal law prohibits use in highway vehicles or engines.”

The following dispenser labels are permanent and must be maintained:

• 500 ppm Locomotive and Marine Diesel Fuel - Beginning June 1, 2010 and Thereafter:

“LOW SULFUR LOCOMOTIVE AND MARINE DIESEL FUEL (500 ppm Sulfur Maximum)

WARNING

Federal law prohibits use in nonroad engines or in highway vehicles or engines.”

• Heating Oil – Beginning June 1, 2007 and Thereafter:

“HEATING OIL (May exceed 500-ppm Sulfur)

WARNING

Federal Law Prohibits use in Highway Vehicles or Engines, or in non-road, locomotive or marine diesel engines. Its use may damage these diesel engines.”

IMPORTANT! It is important to remember that the sulfur content of heating oil remain unregulated under federal law. However, some states have already transitioned to 15-ppm heating oil while others plan to switch over in the next several years.

IMPORTANT! The following IRS dispenser labels are still required:

“DYED KEROSENE, NONTAXABLE USE ONLY, PENALTY FOR TAXABLE USE”

“UNDYED UNTAXED KEROSENE, NONTAXABLE USE ONLY PENATY FOR TAXABLE USE”

“DYED DIESEL FUEL, NONTAXABLE USE ONLY, PENALTY FOR TAXABLE USE”

Got Questions? Contact Mark S. Morgan, PMAA Regulatory Counsel - mmorgan@pmaa.org