WASHINGTON -- A proposed federal bill narrowly approved by the House on Friday could ease requirements oil companies must meet before receiving approval to increase their refinery capacity. The House voted 212 to 210 to approve the bill, which is an effort to deal with the gasoline price spikes and dry pumps that drivers encountered nationwide after hurricanes shut down many Gulf Coast oil refineries.
"We use 21 million barrels of oil a day and only have the refinery capacity for 16 million on a good day. And after Katrina and Rita, we haven't [image-nocss] had many good days," said U.S. Rep. Joe Barton (R), who introduced the Gasoline for America's Security Act, H.R. 3893.
The bill reforms cumbersome siting procedures by requiring the Department of Energy to coordinate the refinery permitting process, but only if a state's governor requests the process or if the president has designated the site as potentially suitable for a refinery.
"In 1981, there were 324 operating refineries in the boundaries of the United States. Today there are 148. Do the math. There are a lot of reasons for it, but one of the reasons is the law as it exists today," Barton said. "What company's board of directors in its right mind would want to go through this complicated process and tie up billions of dollars for years and years if they weren't certain whether this process would wrap up in a timely fashion?"
The legislation requires the Federal Trade Commission to investigate price gouging and, for the first time, grants the agency the authority to prosecute offenses. The bill also cuts the number of "boutique" fuels currently required for different parts of the country from 17 to six, and encourages carpooling to conserve gasoline.
Other provisions in the bill:
Encourages new refineries in order to increase gasoline supplies and address soaring prices.
Requires the president to designate sites on federal lands, including at least three closed military installations that are appropriate for the purposes of siting a refinery.
Allows the president to permit the operation of a refinery to manufacture petroleum products for consumption by the Armed Forces of the United States.
Requires the EPA administrator to identify six gasoline and diesel fuels for a Federal Fuels List, down from 17 today that inhibits the ability to transfer and sell excess fuel from one part of the country when shortages strike another part of the country.
Encourages new pipelines.
Reforms siting and construction requirements for pipelines and for pipeline expansions.
To encourage expeditious construction of the Alaska Natural Gas Pipeline and thereby provide abundant and affordable natural gas to American consumers, sunsets loan guarantee on the Alaska Natural Gas Pipeline within two years of enactment of the Gasoline for America's Security Act of 2005 if the state of Alaska and interested parties have not entered into an agreement regarding construction of the pipeline.
Requires the DOE secretary to study whether crude oil or refined petroleum product pipeline facilities significant to the nation's supply needs have sufficient backup power to ensure availability of product.
Encourages conservation.
Prohibits price gouging in gasoline and diesel fuel sales.
Outlaws price gouging, as defined by the Federal Trade Commission (FTC), in gasoline or diesel fuel sales; requires the FTC to promulgate a standard for price gouging within six months of the legislation's enactment. The federal ban does pre-empt anti-gouging measures already in place in a number of states.Members help make our journalism possible. Become a CSP member today and unlock exclusive benefits, including unlimited access to all of our content. Sign up here.