32 • OIL
&
ENERGY
IN FEBRUARY, THE EPA IS EXPECTED TO
release its final rule on the Tier 3 standard
that is designed to reduce air pollution from
passenger cars and trucks.
Starting in 2017, Tier 3 would lower
the sulfur content in gasoline, and set new
vehicle emissions standards, looking at
both the vehicle and its fuel as an integrated
system. The new standards would reduce
both tailpipe and evaporative emissions
from passenger cars, light-duty trucks,
medium-duty passenger vehicles, and some
heavy-duty vehicles.
EPA had said it was on track to finalize
the proposed sulfur emissions standard
by the end of the year, but after receiving
over 200,000 comments on the proposal,
the timeline for a final rule was revised to
February 2014.
THE TIER 3 STANDARDS
According to the EPA, Tier 3 is among
the most highly cost-effective air quality
control measures available. They project the
program to cost about a penny per gallon of
gasoline, and about $130 per vehicle. The
annual cost of the overall program in 2030
would be around $3.4 billion, but would
yield annual monetized health benefits
between $8 and $23 billion.
Tier 3, as proposed, would require
refiners to reduce sulfur in gasoline from
30 parts per million to 10 parts per million
by 2017. The lower gasoline sulfur standard
would make emission control systems more
effective, and would enable more stringent
vehicle emissions standards.
The earlier Tier 2 standards lowered the
sulfur content in gasoline by 90 percent,
from 300 parts per million to the current 30
parts per million.
The Tier 3 standards were designed to
be implemented over the same timeframe as
EPA’s program for reducing greenhouse gas
(GHG) emissions from light-duty vehicles
starting in model year 2017.
The new tailpipe standards would
include different phase-in schedules that
vary by vehicle class, but generally phase
in between model years 2017 and 2025.
They also include credits for early compli-
ance, and the ability to offset some higher-
emitting vehicles with extra-clean models.
The proposed standards include an
averaging, banking, and trading (ABT)
program that would allow refiners and
importers to spread out their investment
through an early credit program and rely on
ongoing nationwide averaging to meet the
sulfur standard.
REMOVING SULFUR
The sulfur in gasoline does not actually
pose a health problem. Removing the sulfur
allows your vehicle’s catalytic converter to
work more efficiently, reducing tailpipe
emissions. These emissions, nitrogen
oxides (NOX), volatile organic compounds
(VOC), carbon monoxide (CO), and direct
particulate matter (PM2.5), contribute to
smog and air toxics, which can cause respi-
ratory and heart disease.
Compared to current standards, the pro-
posed non-methane organic gases (NMOG)
and nitrogen oxides (NO
X
), presented as
NMOG+NO
X
, tailpipe standards for light-
duty vehicles represent approximately an
80 percent reduction from today’s fleet
average and a 70 percent reduction in per-
vehicle particulate matter (PM) standards.
Proposed heavy-duty tailpipe standards
represent about a 60 percent reduction.
EPA notes that the proposed Tier 3
gasoline sulfur standards are similar to levels
already being achieved in California. But
according to a study released by the American
Petroleum Institute (API) in April, EPA’s
proposed Tier 3 rule would result in an ozone
reduction of less than one percent, relative to
the reductions from EPA’s earlier Tier 2 rule.
Looking at infrastructure, EPA reports
that 66 U.S. refineries would need modifica-
tions to existing hydrotreating equipment
to meet the Tier 3 gasoline sulfur standards,
while 16 refineries would need a major
overhaul.
There are industry concerns that the
U.S. does not have enough excess refinery
capacity to replace supply while modifica-
tions and overhauls are being done over the
next three years, leading to possible short-
ages and higher prices. Refiners believe
EPA’s Tier 3 proposal could increase the
cost of gasoline production by up to nine
cents per gallon.
Fuel
Tier 3 Would Bring Changes to Gasoline and Vehicles
By Ed Burke, Dennis K. Burke Inc.
