President Bush Extends EPA Waivers, Calls for More Refineries
26 September 2005
In discussing the impact of Hurricane Rita on the gasoline and energy supply, President Bush said he has instructed the EPA to keep the clean-fuel waivers in place issued in response to Katrina (earlier post), and well as for continuance of the waiver of the Jones Act restrictions on fuel transportation.
He also called for being “better conservers” of energy by reducing non-essential travel, and for the creation of additional refining capacity in the US.
We have suspended certain EPA winter blend rules so that it makes it easier to import gasoline from overseas. In other words, there’s a supply of gasoline in Europe, and by suspending these rules, it’s a lot more likely to be able to get gasoline into our markets. And so while there’s a shortfall because of down refining capacity, we will work with -- we have instructed EPA to leave the rules in place, or to suspend the rules that were in place, keep the suspension in place, which would make it easier to increase supply, and continue to get supply of gasoline here. And that’s important for our consumers to know.
[...] Let me repeat, we’ll use the Strategic Petroleum Reserve to help refineries with crude oil. We will continue the waivers to allow the winter blends of fuel to be used throughout the country. We will continue to waiver that -- to allow broader use of diesel fuel. Because we understand there’s been a disruption in supply and we want to make sure that we do everything we can to help with the supply disruption.
The Homeland Security waived the Jones Act on restrictions on fuel transportation. We’re allowing foreign flag ships to temporarily transport fuel from one U.S. port to another. That’s going to be important for expediting supply to deal with bottlenecks. We will continue that waiver. The Treasury and IRS announced that dyed diesel fuel for off-road use would be allowed on on-road use without penalty. In other words, we’re taking action to help deal with the shortfall caused by Katrina and Rita.
Two other points I want to make is, one, we can all pitch in by using -- by being better conservers of energy. I mean, people just need to recognize that the storms have caused disruption and that if they’re able to maybe not drive when they -- on a trip that’s not essential, that would helpful. The federal government can help, and I’ve directed the federal agencies nationwide -- and here’s some ways we can help. We can curtail nonessential travel. If it makes sense for the citizen out there to curtail nonessential travel, it darn sure makes sense for federal employees. We can encourage employees to carpool or use mass transit. And we can shift peak electricity use to off-peak hours. There’s ways for the federal government to lead when it comes to conservation.
And, finally, these storms show that we need additional capacity in -- we need additional refining capacity, for example, to be able to meet the needs of the American people. The storms have shown how fragile the balance is between supply and demand in America. I’ve often said one of the worst problems we have is that we’re dependent on foreign sources of crude oil, and we are. But it’s clear, as well, that we’re also really dependent on the capacity of our country to refine product, and we need more refining capacity. And I look forward to working with Congress, as we analyze the energy situation, to expedite the capacity of our refiners to expand and/or build new refineries.
One immediate possible policy action in response to the disruptions caused by the hurricanes as well as the general energy situation not discussed was the re-instatement of the 55 mph speed limit. Originally imposed in response to the oil crises of three decades ago., the 55 mph speed limit conserved some 2.5 billion gallons of gasoline and diesel in 1983, according to estimates by the NRDC.
That figure works out to some 163,000 barrels of product per day—the output of a mid-size refinery.
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