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House Committee OKs New Refinery Legislation

The House Energy and Commerce Committee last week approved refinery legislation—HR 3893: Gasoline for America’s Security Act of 2005—out of committee.

Proposed following the damage to refining capacity caused by Katrina (and now worsened by Rita), the legislation is designed to encourage the building of new refineries. It also tackles gasoline distribution and pricing; reduces the number of specialized fuels in the country from 19 to 6; codifies the President’s ability to waive fuel quality standards in time of emergency, and encourages carpooling.

Our country needs more oil refineries because the people who work for a living need gasoline to get to work. These are the people who earn paychecks and buy groceries and pay their bills, including their taxes. That means they use gasoline every day. They need it, and they need it at a price they can afford to pay.

The President has recently called for Americans to conserve fuel. We should conserve energy, but not by mandates from the federal government. The bill will help Americans conserve gasoline by encouraging car and vanpooling. And where Americans cannot conserve, they should be protected from price gouging.

—Rep. Joe Barton, R-Texas, chairman of the House Energy and Commerce Committee

The legislation includes some of the following provisions:

  • Encourages the construction of new refineries to increase supply by streamlining siting procedures; providing regulatory risk insurance for refiners; mandating the siting of three refineries on designated federal lands; authorizing the president to enter into a contact to have a refinery permitted, constructed and operated to make petroleum products for military consumption; and removing a number of regulatory barriers.

  • Cuts the number of “boutique fuels”—i.e., different blends mandated by regional regulation or sold to specific markets—from 19 to 6.

  • Promotes new pipelines by altering siting requirements for pipelines and for pipeline expansions.

  • Directs the DOE secretary to establish and to carry out a program to encourage the use of carpooling and vanpooling to reduce the consumption of gasoline.

  • Outlaws price gouging in gasoline or diesel sales.

  • Permits the DOE secretary to sell petroleum products from the Strategic Petroleum Reserve (SPR) to finance construction of the additional capacity needed to fill the SPR to 1 billion barrels.

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Comments

The Oil Drum (profgoose)

great catch Mike. linking this up tonight...

wintermane

I told everyone there was a bloody obvious reason the energy sector had stopped pushing hard to get new refineries and pipelines and such. They always knew it would be far better to let american stupidity toward fuel needs cause a crisis and then push through the needed upgrades... Far cheaper and faster and alot less hastle for them. Oh and more profits too.

lensovet

Could you please post more details on exactly what changes have been made in terms of the decrease in kinds of fuels? Have they increased or decreased "standards"? Does that mean that the Rockies region will no longer have 85-octane gas?
Thanks...just curious.

Mike

The proposed legislation is not specific about which fuels; it directs the EPA to figure it out.

Lucas

I've said for years that the USA needs only one kind of automotive fuel - Diesel.

If it were done and done right, most of our air pollution problems would go away. When we exaust all the inexpensive fossil fuels, switching to BioDiesel would be easy. All the infrastructure would already be in place. The remaining oil would be used to produce
pharmaceuticals.

If there were any intelligent people in government, we would be a lot farther down that road.

djm

Lucas, I am an ardent supporter of biodiesel, but do not delude yourself into thinking it is without hurdles. There is currently not enough feedstock to replace all of our commercial vehicle fuel needs, much less passenger car fuel needs. Unless algal biodiesel becomes economically feasible, the biodiesel revolution will wait in the wings. Also, NOx pollution is a large concern with diesel, likewise for biodiesel. Switching LA to 100% diesel/biodiesel would make the air several times worse than it already is in terms of ozone.

Lamar Johnson

The working poor, who cannot afford to buy fuel, home heating oil, kerosene, and natural gas, are the victims of the good intentions of the environmentalists who have opposed new refineries, refinery expansion, CTL technologies, and now they are in opposition to wind power.

The green, politically correct Birkenstock yuppies have really dealt the working poor a cruel blow with their short-sighted energy policies.

Schwa

The poor always get screwed, weather there's environmental regulations in place keeping the industry from freely expanding or we openly dump toxic waste in their back yard, it's always poor people getting screwed by big business and their friends in government. Some countries stand up and fight this nonsense, but then we usually blow away any democratic government that gets any notion of independence... That's empire.

Fred

Our nation's energy strategy is to consume the rest of our oil and as much of the rest of world's as possible. In the big picture, this means global war and the last country standing, like all the others, will lose.

Only a fool would believe that a few environmentalists can stop refinery construction. Big energy corporations have the power to easily crush the environmentalists, with more sophisticated and far reaching propaganda and their cash to buy political influence. Green groups don't have the money to play in Washington. The real reason there is a refinery capacity shortage is because it is profitable for oil companies to keep gas supplies short. Further, oil production is expected to decline rather than grow, so the oil companies don't wish to invest in new refineries that won't be needed.

The real problem is that oil is a fossil fuel that took millions of years to form, and we have used half the supply in 100 years. Prices will increase rapidly as supplies dwindle. Faster consumption will bring on shortages and disaster more quickly.

People in India and China get to work without cars. Why can't we?

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