NCPA - National Center for Policy Analysis

EPA Plans to Require Cleaner Gas

April 1, 2013

The Obama administration is moving forward with tough new standards to cut pollution from cars, prompting an outcry from refiners who say the proposal could raise the cost of producing gasoline by nearly 10 cents a gallon, says the Wall Street Journal.

  • The Environmental Protection Agency (EPA), which says the rule will cost considerably less, wants to reduce the amount of sulfur in gasoline to an average of 10 parts per million, down from the current standard of 30 ppm.
  • The plan, which still must go through public comment before becoming final, would give environmentalists one of the top items on their wish list at a time of disappointment on some other fronts.

Whether the tougher standards would have a big impact on everyday drivers at the pump is a matter of debate.

  • The American Petroleum Institute, which represents refiners, says the standards would cost $10 billion in upfront capital expenditures and an additional $2.4 billion in annual compliance costs.
  • The standards would ultimately raise the price of producing gasoline by up to nine cents a gallon, the institute says, and that extra cost would likely be passed on to consumers.
  • A senior administration official said a tighter sulfur standard would affect the price of gasoline by only a penny a gallon. 

Of the 111 refineries in the United States, the EPA estimates 29 can already meet the tighter standard and 66 can do so with relatively modest improvements.

Source: Tennille Tracy, "EPA Plans to Require Cleaner Gas," Wall Street Journal, March 28, 2013.


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