California takes wraps off dirtier, "winter" gasoline to ease prices

AutoBlog: California takes wraps off dirtier, "winter" gasoline to ease prices

For Californians, the start of "winter" can't come soon enough.

The California Air Resources Board (CARB) has responded to a request from Governor Jerry Brown to allow slightly dirtier gasoline to be sold about three weeks before the state usually switches to the so-called "winter blend" of gas. Brown made the request to bring the gas cost down from record highs.

The most populous US state, which uses gas that's better for the environment in the summer because it evaporates more slowly, usually switches to faster evaporating fuel – the winder blend – on October 31. The cleaner gas is required in the summer because of harsher ozone conditions. Brown made the request after prices topped $4.65 a gallon, on average, this past weekend, about 84 cents per gallon more than the national rate. In some places, a gallon was much, much higher: $5.89 around Big Sur.

CARB's Dave Cleggern told Capitol Public radio that the early switch shouldn't pose a problem this year. "I don't think there is going to be too dramatic an impact on air quality because the temperatures have begun to cool in the nick of time you might say and the cooler temperatures that we're seeing now should help blunt any air quality impact," he said.

California is the only state that uses the exact formulation of gasoline that it does, and the fuel requires special refining. Due in part to a power outage at ExxonMobil's plant in Torrance, CA and some pipeline issues, gas prices spiked recently. The governor's hope is that once the winter blend is added to the state's fuel supply, prices will fall. Some estimates suggest it could drop by as much as 20 cents per gallon within a few days of the switch.

PRESS RELEASE:

Governor Brown Urges Action to Reduce Gas Prices

10-7-2012

SACRAMENTO -- Governor Edmund G. Brown Jr. today directed the California Air Resources Board (CARB) to take emergency steps to increase the state's gasoline supply and bring down fuel prices.

The Governor directed the board to immediately allow oil refineries to make an early transition to winter-blend gasoline. Winter-blend gasoline typically isn't sold until after October 31.

"Gas prices in California have risen to their highest levels ever, with unacceptable cost impacts on consumers and small businesses," said Governor Brown. "I am directing the Air Resources Board to immediately take whatever steps are necessary to allow an early transition to winter-blend gasoline."

Winter-blend gasoline is a mixture that evaporates more quickly than the gasoline sold in summer months, which takes longer to evaporate and is better for air quality during the smog season. Allowing an early transition to winter-blend gasoline could increase California's fuel supply by up to an estimated 8-10 percent with only negligible air quality impacts.

Gas prices in California have skyrocketed over the past week due to a tightening of fuel supplies caused by shutdowns at Tesoro and Exxon refineries. The Exxon refinery came back online Friday and Tesoro is scheduled to resume production early next week. Combined, these actions are expected to stabilize and reduce fuel prices.

The text of the Governor's letter to the California Air Resources Board (CARB) is below:

October 7, 2012

Mary Nichols, Chairman
California Air Resources Board
1001 I Street
Sacramento, CA 95812

Chairman Nichols:

California is temporarily experiencing tight gasoline supplies that are causing dramatic spikes in the price consumers must pay to fuel their vehicles. Gas prices in the State have set new record highs, and gas is completely unavailable at some stations in southern California. If this situation continues, it may cause unacceptable price impacts for consumers and small businesses, significant economic disruption, and serious harm to public safety and welfare.

California refiners are required to produce a summer-blend gasoline through October in most areas of the State. After October 31, a winter-blend gasoline is allowed. Due to the composition of the gasoline, refiners can produce more of the winter-blend than the summer-blend.

In light of the tight gasoline supplies and resulting price spikes, we should not wait until the end of the month to start production of our winter-blend gasoline. Allowing refiners to make an early transition to winter-blend gasoline could quickly increase fuel supply and provide a much needed safety valve with negligible air quality impacts. Accordingly, I am directing that the Air Resources Board immediately take whatever steps are necessary to allow for an early transition to winter-blend gasoline to be manufactured, imported, distributed, and sold in California.

Edmund G. Brown Jr.
Governor