At today's hearing we will examine the recommendations of the U.S. Environmental Protection Agency's "Blue Ribbon Panel" Advisory Committee on Oxygenates and Gasoline on MTBE (Methyl Tertiary Butyl Ether). MTBE is a fuel additive used to add oxygen to gasoline. The Clean Air Act requires Reformulated Gasoline (RFG) to contain 2% oxygen, by weight. MTBE is used in over 85% of RFG as the oxygenate, ethanol comprises the next largest share at 8%. MTBE is also used in a lesser degree as an octane enhancer. The requirement for RFG began in 1995 as mandated in the 1990 Clean Air Act Amendments.
In the last few years MTBE has been found in drinking water sources. It is my understanding that the great majority of the levels found are well below public health concerns, although they create a problem for taste and odor.
Because of these water-related concerns, the use of MTBE has been questioned. In March 1999 Governor Gray Davis issued an executive order that will eliminate MTBE from California gasoline by the end of 2002. There are various legislative options in Congress for dealing with MTBE. These range from an out-right-ban, to a phase-out approach, to making oxygenates optional.
Over the last two years the Full Committee has held two hearings addressing the concerns in California. Today is the first time our Subcommittee has considered the MTBE program nationwide. We will be hearing from members of the Blue Ribbon Panel and other representatives.
EPA's Blue Ribbon Panel issued their Report on July 29, 1999. The findings of the Report have, in my opinion been mischaracterized both in the press and here in the Senate. It is my understanding that the panel's recommendation of an orderly phase down of the use of MTBE was dependent on the repeal of the federal oxygenate mandate. It is my hope that the ultimate goal of today's hearing is for the members of the Committee to fully understand what the Report says and doesn't say, regarding MTBE.
Recently, DOE identified several areas of concern for the U.S. refining industry including the uncertainty of the role of oxygenates, particularly MTBE, in gasoline. I think it is important that we do not jump to any rash conclusions out of unfounded fear or unjustified claims of fuel alternatives. We should not act in haste on the MTBE issue because the potential impacts to the consumer are significant. The safeguarding of the nationwide supply and distribution of gasoline must be a key consideration in any action that is taken to address MTBE.
I believe that one of the most important lessons to be learned from the current situation is that prescriptive mandates reduce flexibility and may lead to unintended consequences.
There are a number of issues and questions that I would like addressed both today and in the coming weeks and months.
1.What are the health concerns related to MTBE?
2.Are there benefits to the air from MTBE or the other oxygenates? Are they necessary?
3.Are there specific negative environmental effects from MTBE?
4.What is the impact of MTBE and the other oxygenates on the fuel supply and delivery systems?
5.Since MTBE was required under the Clean Air Act, if we ban or phase it out, should we compensate for the stranded cost investments of the MTBE producers?
6.What impact will states efforts to address MTBE have on the gasoline supply and distribution system?
We have an excellent slate of witnesses today including the Chairman of the Blue Ribbon Panel and former Senator Jake Garn. This is probably not the last time we well address MTBE or the oxygenates issue, we will probably have a hearing on the environmental effects of ethanol.