Tier 3 Gasoline Standard Ruling to be released by February

Posted by Ed Burke on Dec 10, 2013 8:57:00 AM

The EPA has announced it will release the final rule on the Tier 3 gasoline standard by February of this coming year, after revising the timeline due to the volume of responses received. The standard  is set to be in effect by 2017, with the stated purpose of reducing harmful vehicle emissions and pollution generated by cars and light duty trucks by dropping the sulfur content of gasoline from its present 30 parts per million down to 10 parts per million. (If you recall, Tier 2 dropped gasolines sulfur content from 300 PPM to the current 30PPM) 

The EPA estimates the cost impact of Tier 3 should be around a penny per gallon, but refiners believe that it could be more like 9 cents per gallon. This is because of the overhaul needed at approximately 66 major US refineries to make their existing hydrotrating equipment meet the new standards, and the fear that there is not enough excess in supply to cover demand while the upgrades happen could shoot the price at the pump up.  

The EPA says that by the year 2030 the program should cost about 3.4 billion annually, that they claim is more than offset by the projected monetized health benefits of somewhere between 8 and 23 billion. 

I wrote an article for NEFI's Oil & Energy Magazine that goes into more detail on the standard and how it works, you can read that article here: Oil & Energy Magazine  or in PDF Form by clicking here 

Topics: EPA Mandate, Refinery Closures, EPA, Tier 3 Gasoline Standard, Gasoline Supply Crunch

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