The U.S. Environmental Protection Agency has proposed a 90% slash in U.S. gasoline sulfur limits beginning in 2004, a proposal the refining industry said is needlessly expensive to consumers.
The National Petrochemical & Refiners Association (NPRA) said the proposal would cost refiners $3-6 billion and add up to 10¢/gal to the cost of gasoline.
President Bill Clinton announced the sulfur measure in his weekly radio address. It was linked with a proposed rule to lower the allowable amount of nitrogen oxide emissions for all cars by about 90% and bring sport utility vehicles (SUVs) under the same pollution limits as cars.
Clinton said, "We've taken great pains to make sure these new standards will not cause hardship for the industry or reduced consumer choice. In many cases, existing technology will allow (auto) manufacturers to meet the new standards and still offer the same models popular with consumers today.
"According to some estimates, the benefits of the proposal may outweigh the costs by as much as 4:1."
EPA Administrator Carol Browner said the joint proposal would add 1-2¢ to the cost of a gallon of gasoline and $100-200 to the cost of most cars and trucks. EPA plans to issue final rules by yearend.
Sulfur ruleEPA and automakers have claimed the sulfur content of gasoline interferes with catalytic converters on cars.
The rule would require refiners to limit gasoline sulfur content to a 30 ppm average, down from the current 330 ppm average. The new standard is to be phased in during 2004-06.
The maximum amount of sulfur in gasoline, for purposes of averaging, could not exceed 80 ppm after 2005.
About 18 small refiners in the U.S. would get 2 more years to meet the requirements, if they can demonstrate the sulfur rule would impose a "severe economic hardship."
Refiners that reduce the sulfur in their gasoline ahead of the federal targets could earn credits to use directly or to sell to other refiners during 2004-06.
Browner said the administration would soon propose a rule for cleaner-burning diesel fuel.
Auto ruleThe sulfur rule was combined with one reducing tailpipe emissions standards for cars, SUVs, and light-duty trucks.
Nox emissions would be capped at 0.07 g/mile for most vehicles starting in 2007, although light trucks would have more time to cut emissions to that level.
EPA said that, under the plan, manufacturers would produce vehicles that are 77-95% cleaner than those made now. EPA said the sulfur and auto rules, when fully implemented, would be equal to removing 166 million cars from the road.
Under the new standard, vehicles weighing less than 6,000 lb would be phased in during 2004-07, and vehicles weighing 6,000-8,500 lb would be phased in through 2009.
The current U.S. federal standards range from 0.6 g/mile for cars to 1.53 g/mile for the heaviest SUVs and vans.
As early as 2001, auto manufacturers could obtain credits for later use for vehicles produced at or below the 0.07 g/mile standard.
ReactionsNPRA and the American Petroleum Institute had argued for two higher, regional gasoline sulfur standards, which they said reflect the nation's varied air quality needs (OGJ, Mar. 30, 1998, p. 29).
They said that, under EPA's proposal, gasoline sulfur levels would be reduced nationwide to the extremely low levels now required in California, which has the nation's worst air quality.
"That means all consumers would pay for this costlier-to-manufacture fuel, even those who live in areas where air quality already is very good," they said.
William O'Keefe, API executive vice-president, said, "The case for a national approach has yet to be made, and an approach that does not recognize regional differences in air quality means that consumers will pay more than necessary, and refiners will be hard pressed to make the reductions on schedule."
He said industry would continue to push for changes in EPA's proposal.
Bob Slaughter, NPRA general counsel, said, "Air quality problems are vastly different across the nation. Yet under EPA's plan, the citizens of Boise, Ida., will pay as much or more to clean their air than will the citizens in the Bronx, N.Y.
"This rulemaking has not demonstrated that all regions of the country need the same level of sulfur reductions. The best technology to enable EPA's plan is not yet generally available commercially and, as a result, the costs to achieve EPA's plan are too high," Slaughter said.
API and NPRA said the difference in effects on ozone levels between the EPA and industry proposals would be small and hard to measure.
Slaughter said that, under the EPA schedule, "You're going to see something that looks like the Oklahoma land rush" as refiners scramble for desulfurization equipment and contractors to install it.
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