The Department of Energy said last week it is prepared to use its authority to maintain the flow of products from a U.S. refining industry that is running all out.
DOE has the power under the Defense Production Act to ensure priority repairs to refineries that experience accidents or outages.
It figured refiners used 97% of U.S. operating capacity in August, compared with 93% a year ago.
Utilization rates of available capacity are slightly lower.
Energy Sec. James Watkins told the House energy and power subcommittee last week, "We are concerned about the ability of refiners to continue operating at near maximum capacity for a long time.
"Last week saw the first of many expected refinery shutdowns for maintenance. With our system so fully utilized, we are more vulnerable to events such as accidents, transportation problems, or bad weather."
Rep. John Dingell (D-Mich.) agreed. "Refineries are, for all intents and purposes, operating at 100% of capacity," he said. "They are functioning very close to the danger level."
The Defense Production Act allows DOE and the Commerce Department to require priority performance of contracts and allocate materials and equipment for projects that maximize domestic energy supplies.
Assistant Energy Sec. John Easton recently wrote U.S. refiners, informing them, "This authority could be used to help a refiner expeditiously acquire critical components needed to repair a damaged facility and thereby remove production and distribution bottlenecks."
He added, "Given the projected tightness of supply, it is clearly in our national interest to minimize the impacts of any problems that occur and to restore our domestic producing and refining capacity as quickly as possible."
Watkins said DOE will urge President Bush to "stand ready to commandeer personnel to respond to a refinery emergency" that would reduce product supplies.
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