PMAA has been closely following the developments in
Congress on the issue of MTBE and ethanol and we are deeply concerned
that Congress might worsen the critical gasoline supply and cost
problems burdening industry and consumers in the U.S. PMAA believes
that Congress must eliminate the 2% oxygenate mandate for
reformulated gasoline and, if an interim step is necessary, allow a
state to opt out of that requirement. PMAA supports an orderly
phase-out of MTBE, should E.P.A. or Congress determine such a
phase-down is necessary, but one that also takes into account the
impact of such a phase-out on supply and costs and limits any
negative impact.
In 1990, Congress required
oxygenates to be a part of reformulated gasoline. Petroleum marketers
opposed such a mandate as costly and unproven with regard to the true
benefits to air quality, and now there are concerns that these same
additives are affecting drinking water. Those additives made
necessary by the CAA are another regulatory obstacle that increases
fuel costs. The Congress is now considering ways to reduce the amount
of MTBE used in the United States. However, the political compromise
to enact legislation - a renewable fuels mandate - should not be part
of a final solution.
PMAA believes that ethanol
plays a vital role in the nation’s energy picture and that it also is
important to the economies of several states. To that end, we have
petitioned for relaxation of rules that would allow ethanol to
compete effectively with MTBE. However, a mandated market-share,
combined with a large subsidy, does not benefit American consumers or
taxpayers. Further, such a mandate will have no proven positive
impact on the environment. For these reasons, PMAA opposes a
renewable fuels mandate.
Since Congress established
the mandate for states to use either ethanol or MTBE as the oxygenate
in 1990, PMAA feels strongly that Congress has a responsibility to
free the states from that mandate. PMAA would also discourage
Congress from being diverted to once again focusing on gasoline
storage tanks. This ruse ignores the tremendous investments made by
the industry to upgrade tanks and the tremendous costs incurred
annually to maintain those tanks. Further, it ignores atmospheric
deposition of MTBE, spills from automobile accidents, the operation
of illegal tanks, spills of gasoline by homeowners fueling lawnmowers
and other garden equipment, and fuel leaks at marinas during
refueling events. Thus, we believe Congress and EPA must focus on
MTBE as a component of gasoline, rather than reopening a closed
issue.
PMAA supports the phase-out of MTBE and
believes Congress should act quickly on this issue. However,
resolving that issue by creating a new problem with a renewable fuels
mandate is not the correct legislative combination. PMAA believes
MTBE legislation should contain the following:
- The oxygenate requirement should be waived upon petition by a
state governor;
- MTBE should be phased down in conjunction with the lifting of
the oxygenate requirement;
- There should be no new fuel mandates established by the Congress
that will lead to upward pressure on fuel prices; and
- Congress should provide additional funds (and broaden the
statutory authority for states to use the Leaking Underground
Storage Tank fund for MTBE targeted clean-up) to states for cleanups
because of the cost of MTBE;
Again, PMAA urges you to help refocus the debate on what is fair and
reasonable and appropriately address the issue.
