Senator Proposes National Reserves of Refined Petroleum Products

Senator Jeff Bingaman (D-NM). (image: bingaman.senate.gov)

Writing for Reuters last week, Tom Dogget reported that Senator Jeff Bingaman (D-New Mexico), chairman of the Senate Energy and Natural Resources Committee, wants the federal government to create emergency stockpiles of specific petroleum products, such as gasoline and diesel fuel, to help offset supply disruptions such as those experienced when recent hurricanes knocked out US refineries.The US already maintains a stockpile of 719 million barrels of crude oil in the Strategic Petroleum Reserve (SPR) as well as an additional 2 million barrels of heating fuel in the Northeast Heating Oil Reserve, but there is no reserve of already-refined gasoline, in part because gasoline rapidly deteriorates, losing quality. The Energy Department has previously studied the feasibility of creating a gasoline reserve and ruled out the idea for this reason.

Gasoline is much more highly-refined than diesel fuel or heating oil, which are essentially the same thing. Gasoline is more volatile, meaning it vaporizes easily so it can be burned in a conventional internal combustion engine. The most highly volatile components in gasoline evaporate over time. As they do, the fuel loses the ability to combust properly, resulting in diminished engine performance. As the saying goes, “It turns to varnish.” Your engine may still start and even run, but probably not very well. Opinions vary on the maximum time gasoline can be stored and remain useable, but even with stabilizers added, it starts going bad in about 60 days.

Still, if that technical problem could be solved, a gasoline reserve would be a good thing. Bingaman is leaving it up to Energy Department officials to chose where the stockpiles should be located and what products should be held there. “They make the decision on where these barrels would be stored and what flavor product will be stored,” said committee spokesman Bill Wicker. “They fill in all the details.”

Bingaman has a strong pro-environment record, working to protect wildlife and public lands and supporting the Clean Energy Act of 2007. He is also working on a “cap and trade” bill to reduce greenhouse emissions, and fund research and development of green technologies.

If Bingaman’s proposal flies, says the Reuters piece, the Energy Department could fill the reserves by buying fuel in the market or taking crude out of the SPR and refining it into ready-to-use products. “We give an awful lot of flexibility to the Department of Energy to tell us how to do this,” Wicker said.

The energy committee is scheduled to hold a hearing during the week of May 11 on creating product reserves and then vote on the proposal the following week, according to Reuters.