With its proposal to remove nearly all sulfur from gasoline and diesel fuel, the European Commission threatens to follow the precautionary principle on global warming up an economic smokestack.
The precautionary principle mandates response to worst-case scenarios, regardless of their chances for coming true. On it, European governments nowadays enthusiastically hinge policy. Yet doubt grows around the notion that measured temperatures rise as a function of atmospheric concentrations of greenhouse gases. The hypothesis is giving way to knowledge about the climate's complex and little-understood offset mechanisms and about natural temperature cycles unrelated to gases of human origin.
If temperatures don't rise as a predictable function of greenhouse gases, among which carbon dioxide is the one most associated with human activity, it makes little sense for people to change habits and incur heavy costs to moderate emissions. Yet European regulators march steadily on, eager to slay the CO2 dragon.
The EC proposal
Under this banner, the EC proposes to reduce sulfur in highway gasoline and diesel fuel to 10 ppm after 2005 in all members of the European Union. Under an existing directive, sulfur concentrations for both fuels are to be reduced by 2005 to 50 ppm. At the beginning of 2000, sulfur ceilings fell to 150 ppm for gasoline and 350 ppm for diesel.
Sulfur has no direct effect on emissions of CO2. And reducing sulfur to 10 ppm from 50 ppm has negligible effect on emissions of standard pollutants. By stimulating formation of ammonia, in fact, the reduction might increase pollution by small particles. Nevertheless, the EC wants to mandate the lower sulfur limit for gasoline by 2011 and for diesel at a date yet to be set.
The commission thus bows to the European automotive industry's insistence that the lower sulfur standard is necessary in the exhaust-handling systems of new engines designed for fuel efficiency. The systems don't actually require the 10 ppm sulfur standard. Some of them simply work better with it than they do at the 50 ppm level by, for example, needing less-frequent catalyst-regeneration cycles, which elevate fuel consumption.
"The availability of sulfur-free [fuel] will remove an important technical barrier to the introduction of the most-advanced fuel-efficient vehicles," declared EC Environment Commissioner Margot Wallström while announcing the sulfur proposal. "We can now expect significant reductions in emissions of carbon dioxide from new cars, vans, trucks, and buses."
Maybe. It is much more certain that Europeans can expect sharply higher prices for vehicle fuel.
Refiners will have to invest heavily to meet the tougher sulfur standard. The industry group CONCAWE estimates net present value of investments and increased operating costs from the proposal, beyond costs for the 50 ppm sulfur standard, at 4.8 billion euros ($5.5 billion) for gasoline and 6.7 billion euros ($7.7 billion) for diesel.
Some refiners will divert product streams to other markets; some might close plants. The crimped supply will drive up prices, although the amount is impossible to predict. And vulnerability of the product distribution system to disruption will increase because of new batching and contamination issues.
In return for elevated costs and potentially interrupted supply, Europeans might see no overall decline in emissions of greenhouse gases. As CO2 emissions fall due to improved vehicle efficiency, they'll rise for reasons related to production of the ultralow-sulfur fuels. Increased processing severities will lift refinery energy consumption. Greater hydrogen production will raise CO2 emissions. And growing volumes of pipeline batch interfaces will have to be trucked to refineries for reprocessing, boosting energy use. Furthermore, use of ultralow-sulfur gasoline with some new engine technologies might increase emissions of nitrous oxide, which as a greenhouse gas is more potent than CO2.
Array of offsets
A step back from vehicle systems thus reveals an array of offsets to the CO2 benefits claimed by supporters of deep sulfur cuts. Automakers say the offsets are overstated. But they don't make vehicle fuel.
The EC's proposal would certainly raise the already high prices of vehicle fuel in Europe. The promised gains are-to be generous about it-subject to great doubt. And the overarching goal-CO2 reductions as a precaution against global warming-teeters on a weakening hypothesis. This is whimsical governance. European oil companies owe it to their customers to say so.
