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Issues Concerning the Use of MTBE in Reformulated Gasoline: An Update.
Subcommittee on Oversight and Investigations
Mr. Tom Adams
Chairman Greenwood and Members
of the Committee, I want to thank you for this opportunity to appear on behalf
of the Oxygenated Fuels Association to address issues related to national energy
and fuels policy and the role of MTBE. OFA
is the national trade association of manufacturers of oxygenates, principally
MTBE. For a variety of environmental, commercial and
performance-related reasons, MTBE has become the oxygenate of choice for making
RFG outside the Midwest. MTBE is
used in 80-85 percent of all the RFG produced today and comprises significant
volumes of the national gasoline supply. As
the Dept. of Energy points out, MTBE is valuable not only from the standpoint of
it's benefit to cleaner air, it is contributing over 400,000 barrels of
gasoline production which is equal to the output of 5 US refineries. This hearing is quite timely
for a number of reasons, not the least of which is the continuing interest on
the part of the Administration and the Congress to develop a comprehensive
energy program for this nation, while ensuring environmental progress.
MTBE is a central element of ensuring both.
Adequate fuel supply and distribution is a critical component of the
economy's health and we and others believe that it is incumbent upon our
leaders to take a reasoned and responsible approach to addressing this issue.
As President of a trade association representing companies who are
engaged in providing a significant component of the nation's gasoline
requirements, I want to clear away some of the underbrush surrounding the use of
MTBE and the role it plays in maintaining a clean and secure source of octane as
well as insuring an adequate supply of gasoline at reasonable prices. First, I would like to address, head on, the issue of MTBE and water quality, which I know is of personal concern to you and others on this Committee. First - the facts. Invariably, the presence of MTBE in groundwater has been directly linked to underground storage tanks (USTs) leaking gasoline for an extended period of time - even years in some instances. These leaks, confirms a recently released report by the General Accounting Office (GAO), "are typically due to inadequate or non-existent UST inspection, enforcement and/or maintenance practices." MTBE is easier to smell and detect in water than other gasoline constituents, however, make no mistake about it, the presence of MTBE in a water system means that gasoline is leaking from a containment system. MTBE has rarely been detected in groundwater at levels deemed unsafe by the US EPA. The vast majority of MTBE detections have been at concentrations below five parts per billion (ppb) - far below the EPA Consumer Advisory for MTBE that sets a suggested standard for prolonged exposure of 20 to 40 ppb to avoid unpleasant taste and odor. Several states have confirmed that MTBE does not pose a threat to public health or water sources. For instance, the New Jersey Department of Environmental Protection reported that data from 400 of the state's public community drinking water supplies found no instance where MTBE approached New Jersey's drinking water standard for MTBE. The New Jersey report noted that, "MTBE contamination is not currently a public health concern in New Jersey public drinking water supplies." In another case, California, in early October, the California Department of Health Services reported that MTBE has been detected in only 0.9 percent of all water sources sampled (79 of 9,062), with only 0.2 percent of all samples exceeding California's primary health standard for MTBE (21 of 9,062). In addition, an August
report by the engineering consultant firm Malcolm Pirnie on water quality
impacts in California finds that detections of MTBE in both surface and public
water supplies have steadily decreased since 1998 - the year in which new
federal tank design improvements went into affect.
The EPA's Blue Ribbon Panel Report and the UC-Davis Study both based
their recommendations to reduce MTBE use largely on the assumption that MTBE
groundwater detections would increase.
The fear expressed by the Blue Ribbon Panel was that MTBE was not a
health or environmental threat, but that; it could become such a threat if not
properly controlled. We are seeing "the tip of the iceberg" was the refrain
among some Blue Ribbon Panel participants.
While it is always prudent to be cautious, it is very important to now
understand that the key assumptions made by the Blue Ribbon Panel and UC-Davis
have not come true - MTBE detections are not wide-spread, and, more
importantly, MTBE is not being found at levels that pose a threat to human
health, the environment, and even at levels that may cause consumers to taste or
smell MTBE in water. In short, it
appears that there never was an "iceberg." There are reasons why MTBE
detections have not become the threat predicted by the Blue Ribbon Panel.
Ongoing state and federal UST upgrade initiatives have helped to control
releases of gasoline into the environmental. The collective focus, as stated in the GAO
report, toward properly designing, installing and maintaining modern gasoline
storage systems has helped to ensure better containment of gasoline, providing
an increased margin of safety.
At the time of the Blue Ribbon Panel, EPA estimated that more than 20
percent of all USTs failed to comply with federal installation and maintenance
requirements. Today, more than 90
percent of USTs meet federal requirements for improved installation and
maintenance. As a result, gasoline
leaks are been significantly reduced and, therefore, MTBE detections (like all
gasoline components) are not posing the problems predicted by the Blue Ribbon
Panel. However, further improvement to
the nation's USTs program must continue.
As the GAO Report recommended, many states and the federal government are
not doing enough to properly and effectively enforce current UST laws requiring
that leaks be detected and stopped before they become an environmental issue.
For example, at the time of the Blue Ribbon Panel, EPA estimated that 40
percent of all UST failed to meet federal requirements for leak detection.
Today, EPA reports that there has been LITTLE IMPROVEMENT in leak
detection compliance. This lack of
enforcement allows known gasoline leaks to continue unabated, risking the health
of citizens and the environment. Effectively
detecting gasoline leaks from UST through improved detection, monitoring and
enforcement - as federal law requires and the GAO Report specifically
recommended - is the key to preventing gasoline contamination. In virtually every instance
today where gasoline (with or without MTBE) is detected in a monitoring well or
water resource, it can be directly linked to the failure to properly enforce
current laws that require rapid leak detection and monitoring. OFA looks forward to working
with this Committee and industry to develop cost-effective ways to further
improve our nation's tank system. In those instances where
gasoline containing MTBE does escape from a leaking underground gasoline storage
tank, recent studies prove that it can be easily and cost effectively remediated.
A recent Malcolm Pirnie evaluation of California MTBE
remediation efforts concludes "[i]n summary, unit costs for remediation of
MTBE impacted sites, and unit costs for MTBE removal from groundwater are likely
to decrease in the future as a consequence of research efforts ." Further, a review of recent EPA data in response to a survey
of states remediation practices and findings relating to MTBE finds that MTBE
remediation costs are consistent with the costs of remediation of gasoline
generally. It is apparent that the cost of
properly enforcing current UST law is more cost-effective than banning the use
of one of the most effective clean-burning gasoline components used today -
especially at a time when gasoline supplies are tight, prices are high, and, in
light of the events of September 11, issues of energy security are more
important than ever. I would like to specifically
discuss Pennsylvania's experience with MTBE and underground storage tanks. Like many other states,
Pennsylvania has created a mechanism to assist their underground storage tank
owner/operators to meet their obligations under federal law.
Effective 2-1-94, UST owner/operators have been covered by the
Underground Storage Tank Indemnification Fund, which, after the payment of a
$5,000 deductible, covers releases up to $1,000,000.
Revenue for the Fund is derived from fees paid by UST owners/operators.
The Fund is required to be actuarially sound and from a financial
standpoint is extremely strong. Activities of the Fund are administered by a board composed
of various state agencies and parties from the regulated community. Recognizing that prevention of
releases was the best way to protect the integrity of the Fund and protect the
environment, the Board worked with the Pennsylvania Legislature to adopt a
number of measures. First, they
created a low interest loan fund to assist small tank owner/operators meet the
upgrade requirements under federal law. Second,
the Board appropriated money to create a program where out-of-service and
abandoned tanks would have their contents pumped out and the tanks sealed at no
cost to small operators. Funds were
also set aside for DEP to clean up sites where there was no identifiable
responsible party. Another interesting fact
obtained from the 2000 Annual Report of the Fund shows that average cost to
clean up a release in the Commonwealth is $106, 656.
The southeast part of the state, where RFG is required to be sold,
actually has the lowest cost per cleanup level at $96, 860. Congress has already begun
consideration of measures to specifically provide additional protection against
possible gasoline leaks from UST systems. In late July, the House passed its
Comprehensive Energy Package (HR 4). Included in that Bill was language to
appropriate an additional $200,000,000 from the LUST Trust Fund for the
assessment, corrective action, inspection and monitoring for possible MTBE
detections. More recently, industry has developed legislative language to
provide increased funding for states to be used specifically for improved
enforcement, inspection and compliance initiatives. OFA feels that this
legislative approach is the proper course of action to best ensure that gasoline
containment systems are not continuing to leak into the environment. Regarding health impacts, a
consensus has emerged. Reviews by
scientific panels from the US government (the National Toxicology Program),
state governments (such as California's own Carcinogenic Identification
Committee) and even international health organizations (such as the World Health
Organization's International Agency for Research on Cancer and, more recently,
the European Community) all have declined to list MTBE as a human carcinogen. Indeed, the Health Effects Institute, in June of this year
released a report stating that "effects of MTBE exposure are likely to be no
more, and may be less, than the effects seen in previous studies."
Therefore, they concluded, "MTBE would be considered less likely to
have adverse effects than previously thought." Now then, to air quality and
MTBE's role in Reformulate Gasoline. MTBE
is not a new gasoline additive limited only to RFG.
It was first used in gasoline in the late-1970's as an octane enhancer
to replace lead. Today, estimates
show that MTBE is blended to some degree in approximately 30 to 50 percent of
all gasoline sold in the US, including RFG.
By every measure, clean-burning RFG blended with MTBE has exceeded all
pollution reduction goals substantially and cost-effectively improving the
nation's air quality. RFG has cut
smog-forming pollutant emissions by over 17 percent, the equivalent of removing
64,000 tons of harmful pollution from the air we breathe or taking 10 million
vehicles off our roads. RFG has
reduced emissions of benzene, a known human carcinogen, by some 43 percent,
while reducing total toxic air emissions by about 22 percent.
Cleaner-burning MTBE accounts for a large part of the overall emission
reductions from RFG. In 1998, the
Northeast States for Coordinated Air Use Management found that RFG with MTBE
substantially reduced "the relative cancer risk associated with gasoline
vapors and automobile exhaust compared to conventional gasoline," concluding
that today's RFG reduced cancer risk by 20 percent over conventional gasoline. Finally, by requiring RFG to
contain a minimum 2.0 percent oxygen by weight, Congress recognized, in the 1990
Clean Air Act, that oxygenated compounds such as MTBE enable refiners to reduce
air pollution while maintaining octane levels and fuel performance and
stretching the use of a barrel of oil. In
RFG, oxygenates allow for more complete fuel combustion, reduce carbon monoxide
emissions during the winter months, smog-forming volatile organic compounds (VOCs)
in the summertime, and toxic air emissions year-round.
Despite other oxygen choices, refiners have overwhelmingly turned to MTBE
to satisfy the RFG oxygen content requirements. For the reasons mentioned
above, it is our view that legislators carefully examine the issues surrounding
MTBE. What is the truth vs.
speculation. I'd like to leave you with
these facts:
Thank you, Mr. Chairman for
this opportunity to testify. I look
forward to working with you on these matters and welcome any questions you and
the Members of the Committee have at this time.
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