1997 ANNUAL REPORT
FUELS

Oxygenate Usage Sparks Controversy

The 1997 focus of debate in many Western states continued to be on the comparative merits of cleaner-burning fuels and oxygenates with controversies in Arizona, California and Nevada leading the way.

In California, a four-month, $6 million study by the Air Resources Board (CARB) concluded that in 1997 the state experienced its cleanest air in four decades, crediting cleaner-burning gasoline as one major reason for the dramatic reduction in air pollution. Never the less, controversy swirled around the use of oxygenates in manufacturing this gasoline as mandated by state and federal governments. Concerns were raised about the potential health and environmental effects from the release of one oxygenate, MTBE, from leaking underground storage tanks, personal watercraft, refueling and auto exhaust emissions. The discovery of MTBE in several City of Santa Monica water wells forced the closing of the wells and heightened the controversy.

These concerns led WSPA's Downstream Committee and Major Issues Task Force to form a MTBE Task Force to bring together the best technical and advocacy resources to manage the unfolding MTBE issue. During the year, the task force focused on legislation, media and public advocacy while various technical committees provided support to air and water agencies and utilities throughout the state.

With the support of a broad-based coalition of environmental groups and regional air districts, WSPA was successful in amending bills that would have banned outright the use of MTBE while placing onerous liability standards on the use of the oxygenate. Once amended, WSPA supported the passage of bills that required among other things: a state study of the health and environmental risks and benefits of MTBE; gubernatorial action if a risk were identified; detailed mapping of existing underground tanks, pipelines and drinking water wells; and adoption of a primary drinking water standard for MTBE.

On the technical front, WSPA developed partnerships with both the Lawrence Livermore National Laboratories and the U.S. Department of Energy to study the transport of MTBE in groundwater and to research future remediation technologies. WSPA also began working closely with the Association of California Water Agencies (ACWA) to develop cost-effective, short and long-term strategies for remediation of MTBE in groundwater. Several workshops

for the public and water agencies were co-sponsored by WSPA to provide information on current remediation technologies and the health impacts of MTBE in cleaner-burning gasoline. WSPA also commissioned a consultant study to determine the impact in California if MTBE was banned.

The challenges surrounding MTBE are expected to continue into next year, and WSPA is planning to again support amendments to the federal Clean Air Act which would allow refiners flexibility to meet emission reductions without specific mandates for oxygenates.

Arizona Rolls Out Reformulated Gasoline

In Arizona, meanwhile, WSPA worked with state agencies to ensure the smooth rollout of reformulated gasoline beginning in August. The phased-in introduction of federal Reformulated Gasoline came after a contentious legislative session and a lengthy stakeholder process to develop detailed regulations and enforcement stipulations.

Air quality problems continue to escalate in fast-growing Phoenix as the city was bumped up to serious non-attainment classification for ozone during the summer. New State Implementation Plans (SIPs) for carbon monoxide (CO) and particulate matter will be submitted by year end with reformulated diesel under consideration along with a number of other alternative fuel provisions and the adoption of California's low emission and zero emission vehicle programs.

In the Tucson area, WSPA is working with Pima County to develop cost-effective alternatives to the proposed Stage II vapor recovery requirements. WSPA has taken the position that the need for vapor recovery had not been demonstrated under the Clean Air Act since the area is in attainment of ozone standards.

Ethanol Mandate in Las Vegas

Over strenuous industry objections in Nevada, the Clark County Health District approved an ethanol mandate, requiring 3.5 percent oxygen by weight in gasoline sold during the winter CO season. WSPA attempted to include language that would allow the use of alternative gasoline formulations if they were found to produce equivalent CO reductions. The Board of Health deferred consideration of this option until at least next January.

Although the Las Vegas area appears to be in attainment of the current and proposed ozone standards, the Health District has initiated a process to determine what preventative measures, including reformulated gasoline, could be implemented to maintain that status. WSPA has urged the district to defer all action until the need has been demonstrated. At that point, WSPA will ask that the district study the cost effectiveness of a wide range of control measures rather than focus on reformulated gasoline.

1997 WSPA Annual Report
Fuels