New Senate Bill Takes Market-Based Approach to Future Fuels

WASHINGTON, D.C. -- Bipartisan legislation aimed at removing the legal and infrastructure obstacles to the sale of alternative fuels in the United States was introduced Thursday in the U.S. Senate. The Domestic Fuels Act of 2012 provides a market-based, no-cost approach to produce more energy, increase competition, foster greater sales of alternative fuels, provide more consumer choice and lower the cost of motor fuels at the pump, according to the bill's sponsors, Sens. John Hoeven (R-N.D.), Roy Blunt (R-Mo.), Amy Klobuchar (D-Minn.) and Mike Crapo (R-Idaho).

As reported by CSNews Online, the domestic fuels bill was one of a number of concerns convenience store retailers discussed with legislators during NACS' 2012 Day on Capitol Hill, held in March. The legislation would allow retailers to sell new fuels with a lower cost of entry and at a lower risk of legal liability.

Currently, the high cost of entry for retailers, inconsistent standards and other regulatory factors limit the amount of renewable fuel that can be sold through existing motor fuel retail outlets. The Domestic Fuels Act takes a market-based approach, driven by supply and demand, which makes it easier to market all fuels and give consumers more choice at the pump, the sponsors contend.

Specifically, the act:

• Streamlines the process so that all fuels, both traditional and renewable, can be stored and dispensed with common equipment. The bill requires the Environmental Protection Agency (EPA)to develop streamlined criteria so that underground tanks can be used to dispense gasoline, diesel, ethanol or some combination of fuels, rather than requiring the use of separate tanks.
• Provides liability protection for retailers that meet the streamlined EPA standards so they can sell multiple types of fuel with less red tape, providing consumers with more choice and lower fuel prices.
• Establishes a new pathway for retailers to ensure their equipment is safe and legally recognized as compatible to sell new fuels, thereby reducing the cost of entry for many retailers.

"We need to make all fuels available to American consumers and businesses, and we need to do so by using tested market-based measures that increase competition and remove bureaucratic obstacles to producing and marketing both domestic and traditional fuels," said Hoeven.

This bill "would cut through red tape and help provide the clear standards needed to increase competition and bring homegrown energy to consumers," added Klobuchar.

In addition to NACS, the bill is supported by a wide range of industries, associations and companies, including the Renewable Fuels Association, Growth Energy, American Petroleum Institute, Tesoro Corp., ExxonMobil Corp., Society of Independent Gasoline Marketers of America (SIGMA), Petroleum Marketers Association of America (PMAA), National Association of Truck Stop Operators (NATSO) and Outdoor Power Equipment Institute (OPEI).

"This legislation is the culmination of an unprecedented and multi-year collaboration among all parties in the transportation fuels universe – marketers and retailers, auto engine manufacturers, non-road engine manufacturers, renewable fuel advocates and manufacturers of transportation fuels," commented Gregory Goff, president and CEO of Tesoro Corp.

The bill will speed the nation's transition to E15 and higher ethanol blends and other biofuels, according to Bob Dinneen, president and CEO of the Renewable Fuels Association. "The bill would avoid unnecessary infrastructure investments by providing gasoline marketers with a commonsense certification pathway for existing equipment that assures safety, while accelerating consumer access to these new fuels," he said. "The Domestic Fuels Act could help deliver price relief at the gas pump for consumers, while increasingly liberating this country from its unhealthy, unsafe dependence upon foreign oil."

The Domestic Fuels Act has also been described as "fuel neutral," in that it does not designate or favor any one specific type of traditional or alternative fuel.

Similar legislation, sponsored by Reps. John Shimkus (R-Ill.), Mike Ross (D-Ark.), John Sullivan (R-Okla.), and Collin Peterson (D-Minn.), is expected to be introduced in the House.