EPA denies gasoline oxygen waiver for California

June 18, 2001
The US Environmental Protection Agency last week denied California's request to waive the federal oxygen content requirement for reformulated gasoline (RFG).

The US Environmental Protection Agency last week denied California's request to waive the federal oxygen content requirement for reformulated gasoline (RFG).

EPA Administrator Christie Whitman said, "After an extensive analysis, the agency concluded that there is significant uncertainty over the change in emissions that would result from a waiver. California has not clearly demonstrated what the impact on smog would be from a waiver of the oxygen mandate. We cannot grant a waiver for California, since there is no clear evidence that a waiver will help California to reduce harmful levels of air pollutants."

The dilemma

In April 1999, California Gov. Gray Davis asked the agency to waive the 2.0 wt % oxygen requirement, because the state had opted to ban the oxygenate meth yl tertiary butyl ether starting in 2003.

The only other commercially available alternative to MTBE is fuel ethanol, and state officials fear there is not enough supply to meet California demand. State officials also maintain that fuel ethanol volatility could undo the clean air benefits surrounding reformulated gasoline.

Ethanol fuel producers say they can expand to meet demand growth, but others are skeptical. Analysts say there is 131,000 b/d of fuel ethanol capacity, with nearly half controlled by one supplier, the agri business giant Archer Daniels Midland Co. Plans are on the drawing board to double that figure by 2005, but only 8,700 b/d of capacity is under construction with an ad di tional 26,700 b/d in advanced planning.

Refiners are expected to continue lobbying the White House and Congress to revise clean fuel rules so that RFG can be sold without a mandated oxygenate level.

Other states, including most recently New York and New Jersey, are moving forward with MTBE bans because of concerns that the chemical can seep too easily into groundwater.

Whitman said, "The administration is concerned about the risks of MTBE in drinking water in California and other states. Clean air and clean water are equally important. We do not want to pursue one at the expense of the other. As it currently stands, the Clean Air Act provisions limit the agency's ability to address these concerns. We are exploring all options and currently assessing the health risks of MTBE."

Ethanol push

Ethanol interests, supported by powerful Midwest agribusiness companies, are calling on Congress to mandate national ethanol levels.

Under legislation proposed by Sens. Chuck Hagel (R-Neb.) and Tim Johnson (D-SD), the Department of Energy would require fuel refiners, blenders, or importers to use a minimum percentage of renewable fuels. The renewable fuel standard would require in 2002 that 0.8% of the fuel supply (on a btu basis) be derived from renewable fuels such as ethanol and biodiesel. The standard would increase to 3% by 2011 and 5% by 2016, which amounts to an eightfold increase in the use of renewable fuels by 2016.

EPI attempted to mandate national fuel ethanol levels during the administration of President Bill Clinton but lost legal challenges.

The White House supports extending the 5.4¢/gal excise tax credit for ethanol, and as a "renewable" fuel made from corn, it could also benefit from a proposed House energy tax bill.