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Hoping to avert gasoline price spikes next summer, federal regulators suggested cutting down on the number of specialty fuels designed to meet the nation's dizzying array of local anti-pollution requirements.
In recommendations made to the White House yesterday, the Environmental Protection Agency (EPA) also said the transition from winter to summer fuel blends should be accelerated. Storage facilities linking pipelines and gas stations should be required to stop accepting winter blends after April 15, instead of after May 1, according to the Associated Press. The proposals were made in response to President Bush's energy plan, which asked the agency to address the issue administratively.
"We want to ensure that using summer blend fuel is not a contributor to price hikes," EPA Administrator Christie Whitman said, adding that gasoline prices appear to increase dramatically, as during this past summer, when supplies fall short due to higher demand or pipeline disruptions.
Each year, fuel producers make the April-to-June transition from winter to summer grade reformulated gasoline. Whitman said the proposed administrative and regulatory actions would help refiners, particularly those in the Midwest, in advance of next year's spring transition season, the report said.
The EPA proposed reducing the more than a dozen boutique blends in various states. EPA also recommended fewer data reporting requirements and "broader testing tolerance" for things such as volatility of fuels and levels of cancer-causing benzene, said Jeff Holmstead, who heads EPA's Office of Air and Radiation.
Holmstead said it would be a complicated undertaking for Congress to cut the number of boutique blends allowed without compromising air quality. "Exactly how you would do that and without having an unnecessarily expensive program is the problem. We think there are ways to do that ... but they all have trade-offs," he said.
According to the oil industry, specialty blends designed for local needs lead to increases in gasoline prices as refiners switch to producing them each summer and fall.