Maureen Lorenzetti
Washington Editor
WASHINGTON, DC, May 10 -- The American Petroleum Institute wants the US Environmental Protection Agency to expand the scope of an independent review panel that is scheduled to review low-sulfur diesel standards later this month.
Last month EPA said refiners, environmental groups, fuel distributors, and state and local governments would participate in the panel, which is expected to begin its work May 23. The group is slated to issue recommendations to the agency by mid-September.
Meetings will be open to the public (OGJ Online, Apr. 24, 2002).
EPA said the panel will mainly concern itself with technology issues; namely the progress diesel engine-makers, refiners, and emission-control system specialists have made in finding new ways to meet the tough new engine exhaust standards and fuel specifications.
API letter
But in an Apr. 26 letter to EPA Assistant Administrator Jeff Holmstead, API Downstream General Manager Ed Murphy urged the agency to broaden the discussion to include supply shortage concerns by refiners; deliverability issues that may occur with the new fuel specifications; and a closer examination of the agency's proposed credit trading system.
According to Murphy, there are many considerations that are likely to impact a refiner's decision to desulfurize its diesel output that the panel is now not slated to review.
These considerations include the unknown final nonroad diesel fuel requirements, the viability of after-treatment technologies, the size of the investments required, the secondary importance of the diesel market for many refiners, the availability of alternative sales outlets for distillate fuel, and the uncertainty about refiners' ability to recover their costs in the marketplace.
Pipeline company sought
API also asked EPA to add a member to the panel from one of the pipeline companies that would ship low-sulfur diesel.
EPA has not yet responded to the association's request, but an answer is expected shortly, industry officials said.
Last June EPA said it would pursue an independent study to take a second look at the Clinton administration-era rule. The regulation now on the books forces refiners to meet a 15 ppm standard before 2007 on 80% of diesel supply. The remaining 20% will be phased in by 2010 (OGJ Online, June 6, 2001).
A legal challenge to the rule from API and the National Petrochemical & Refiners Association failed May 3, and it is uncertain whether industry will appeal.
Last year environmental groups and state air administrators urged EPA not to convene a panel, saying the rule should stand as written, given that it has already gone through an extensive public comment period. Since that time EPA chose to hold the review, and both local air pollution officials and clean air groups say they will have a seat on the panel this summer.
Both constituencies are expected to argue that the rules represent a cost-effective way to lower harmful air pollution that otherwise would mean billions of dollars in public health costs.