US issues new gasoline emission standards, industry balks

WASHINGTON (ICIS)–Federal officials on Friday proposed tougher sulphur standards and other emissions restrictions for gasoline, saying the rules would save thousands of lives and billions of dollars in medical care at little cost to refiners or consumers.

US energy and refining interests charged, however, that the new rules are without merit, would cost billions of dollars to implement and could hike gasoline prices by as much as $0.09/gal (€0.07) and likely cause increased pollution.

The Environmental Protection Agency (EPA) issued its proposed rulemaking on gasolines and automobile tailpipe emissions, saying the more stringent standards were sensible and would “significantly reduce harmful pollution, prevent thousands of premature deaths and illnesses while also enabling efficiency improvements” in US autos and light trucks.

If implemented as proposed, EPA said the new fuels criteria would cut smog-forming volatile organic compounds (VOCs) and nitrogen oxide emissions from vehicles by 80%, set a 70% tighter standard on particulate matter and reduce fuel vapour leaks to near zero.

The regulations, said EPA, would reduce sulphur levels in gasoline by 60%.

The proposal, said EPA acting administrator Bob Perciasepe, is “another example of how we can protect the environment and public health in an affordable and practical way”.

Perciasepe said in a statement that the new rules, known as Tier 3 or the third iteration of EPA fuel emissions reductions “will cost refiners less than a penny per gallon of gasoline on average” once they are fully in place. The proposed regulations would go into effect in 2017.

But the American Fuel & Petrochemical Manufacturers (AFPM), the principal US refining industry trade group, blasted the proposed fuel standards, charging that they are “completely without merit given that the agency has not previously offered any cost/benefit analysis to justify this onerous rulemaking”.

AFPM president Charles Drevna said that “EPA’s failure to provide any information on the need for this discretionary rule, despite repeated requests from American fuel manufacturers, strongly suggests the lack of a credible case”.

Drevna said that US refiners have already spent billions of dollars to achieve a 90% cut in gasoline sulphur levels, reducing them from an average of 300 parts per million (ppm) in 2004 to a current average of 30ppm.

To implement the new EPA sulphur standard for gasoline, he said, “will require another $10bn in new infrastructure and another $2.4bn per year in operating costs on an industry already burdened by questionable regulations”.

Bob Greco, director of downstream affairs at the American Petroleum Institute (API), said that the proposed fuel standards would raise refiners’ costs, provide little or no environmental benefit and actually increase carbon emissions.

The new rules, he added, are part of “a tsunami of federal regulations coming out of the EPA that could put upward pressure on gasoline prices”.

While EPA said the rules would add only one cent to the price of a gallon of gasoline, Greco said the cost to consumers would be more like nine cents per gallon.

He said that implementing the new fuel standards “would actually increase greenhouse gas emissions because of the energy-intensive equipment required to comply”.

“We urge the administration to bring common sense back into the regulatory process,” Greco said, adding: “Unnecessary regulations just mean higher costs and lost jobs.”

EPA said the proposed rules, which run 885 pages, will be subject to a period of public comment and an unspecified number of public hearings.

($1 = €0.78)

Paul Hodges studies key influencers shaping the chemical industry in Chemicals and the Economy