DU Energy/economics experts, Please help me understand this...

[usregimechange]

Recently, Roy Blunt has proposed the following:

"Suspending nationally the EPA reformulated gasoline
program’s oxygenate mandate, which will permit
refiners additional flexibility to increase their
refineries’ output of gasoline."1

However, a Texaco memo from 1996 states:

"...One example of a significant event would be the
elimination of mandates for oxygenate additions to
gasoline. Given a choice, oxygenate usage would go
down, and gasoline supplies would go down
accordingly." 2

Getting rid of the oxygen mandate may increase air pollution but how would it effect gas supply?

Thank you for your time,

usregimechange
http://majoritywhip.house.gov/news.asp?formmode=SingleRelease&gcid=833
http://www.consumerwatchdog.org/energy/fs/5104.pdf

[NNadir]

1. The industry line is that it allows for the flexible use of capacity.

Refineries represent continous chemical processes. Thus it is expensive to shut the train down to provide for varying formulations since during shut down, fixed costs still accrue.

In general - certain examples of fantasy land excepted - one seeks to run an industrial asset of any type at maximal capacity loading.

I don't buy the claim at all that this proposal will actually much effect the price of gasoline. What it will effect is profits, which is the Bush point.

That said, if you really think about it, trying to formulate gasoline so that it is "safe for the environment" is rather like placing styrofoam padding on steel bullets to make them "less harmful."

If environmental concerns were paramount, gasoline would be simply banned. There are many possible replacements but all require investment in infrastructure.

[Massacure]

2. The U.S. uses several different blend of gasoline depending on the region.

By getting rid of the different blending standards, they make sure one region doesn't have too much while another doesn't have enough.

Don't ask me how it would have broken down had they not done that though. The politicians probably just wanted to be seen doing something.

[rfkrfk]

3. the oxygen mandate is rubbish, very few cars have carburetors

the idea behind the 'oxygen mandate' is,
to 'lean-out' the air-fuel mixture produed by
the carburetor, thus less hydocarbon and
carbon monoxide pollution.
This 'lean-out' is accomplished by, putting
a substance in the gasoline, that uses
'less oxygen per volume', for complete combustion.

The substances usually chosen are,
MTBE, ETBE, TAME, and ethanol.

cars have changed, the vast majority of gasoline road vehicles,
now have an 'oxygen sensor' in the exhaust pipe.
the oxygen sensor detects 'rich/lean' condition in the exhaust,
and adjusts the air-fuel mixture, thus the system
'adjusts out' the effect of gasoline changes.
in addition, the catalytic conveter cleans up most
of the mess, anyway.

there is a political angle, here.
Some states, for other reasons, have banned MTBE.
I think the 'problem' caused by MTBE was exagerated,
but other states can do what they want, better would
be to ban underground storage tanks.

The combination of...
the federal mandate for oxygen in gasoline, in some places, plus
some states banning MTBE,
creates a 'mandated demand' for ethanol, the usual
MTBE alternate.
Farm states like the idea that certain other
states are kinda forced to add ethanol
to gasoline.
That is the political angle.

eliminating the 'oxygen mandate', IMO, would clearly
increase supply, but I don't know by how much.
The statement from Texaco is rediculous,
becasue, you could always keep meeting the 'former' specs.


amoung the different gasoline blends.....
{in the following, the different blends, have variations by
octane grade, and Noth-South-seasonal vapor pressure.

there is 'conventional'

there is 'MTBE compatible gasoline blend', aka reformulated,
for what I
call a 'normal federal smog area', more difficult to make.

there is 'ethanol compatible gasoline blend', for federal
smog areas that have also banned MTBE, even more difficult
to make.

There is 'California' blend
because of California state gas laws,
even MORE difficult to make.

I won't go into the NY, Minn., or Arizona, thing.

Bush relaxed the federal specifications on
gasoline vapor pressure, which presumably increases
supply, becase less specialty-blending componets will
be needed to meet the easier spec.
I really think the effect on the air will be negligible,
but believe whatever you want.

Does Germany have lots of people with asthma?
the gasoline components the US does not want,
ends up being used somewhere,
either as the export of benzine to other countries,
or the benzine is removed before being sent to the US.