Beginning in June 2006, the sulfur content of diesel in the U.S. will be greatly reduced. The costs to customers will increase somewhat, but the payoffs are great.
Europe already has newly designed quiet, fuel efficient and clean diesels. It's just a matter of the costs and competitive import hurdles to get them in the U.S. :
ULTRA LOW SULFUR DIESEL
WHAT IS IT?
Ultra-low sulfur diesel fuel is a specially refined diesel fuel that has dramatically lower sulfur content than regular on-highway diesel and can be used in any diesel engine just like regular on-highway diesel fuel.
Today, the sulfur content of ULSD ranges from 15 to 30 parts per million. Regular diesel has a maximum of 500 parts per million of sulfur. Other than the sulfur content, ultra-low sulfur diesel generally meets the same specifications as regular on-highway diesel. Starting in 2006, the majority of highway-grade diesel fuel must be ULSD and have no greater than 15 ppm sulfur level at the pump.
HOW DOES ULTRA LOW SULFUR DIESEL CONTRIBUTE TO THE CLEAN DIESEL PROCESS?
Using ultra-low sulfur diesel will contribute to dramatic reductions in diesel emissions.
The lower sulfur content produces fewer sulfate emissions and most importantly enables use of emission- reduction equipment, like particulate traps and catalytic converters to lower emissions of particles and nitrogen oxides. Use of these systems in combination with ultra-low sulfur diesel can reduce emissions of fine particulates by more than 90 percent and emissions of hydrocarbons to nearly undetectable levels. .
Even without special emission-reduction equipment, use of ultra-low sulfur diesel in diesel engines reduces sulfate pollutants. It also has some benefits by lowering engine maintenance costs.
When widely available, ultra-low sulfur diesel fuel is expected to have virtually the same energy and performance as today's highway diesel.
HOW MUCH MORE WILL ULSD COST?
Cleaner ULSD will cost more than current highway diesel fuel. EPA estimates that it will cost consumers several cents per gallon at the pump, when it is required on a widespread basis (see below). Until then, predicting the actual cost impacts is highly uncertain.
CONVERTING TO, AND THE AVAILABILITY OF, ULTRA LOW SULFUR DIESEL
Converting to ultra-low sulfur diesel fuel is simple. ULSD doesn't require any special storage systems, and is stored in the same kinds of storage tanks and fueling systems of today's diesel fuel.
ULSD is already available in some parts of the country on a limited basis, mostly to fleet purchasers, but at some service stations in California. Many transit and school bus fleets around the country have converted to using cleaner ULSD in their existing operations. For an up to date map showing where ULSD is available go to
http://www.epa.gov/otaq/retrofit/fuelsmap.htm. U.S. Environmental Protection Agency (EPA) rules will require that new diesel engines meet lower emission levels beginning in 2007 and will require ultra-low sulfur fuels for all on-road engines beginning in 2006.
http://www.dieselforum.org/factsheet/ulsd.html___________________________________________________________
In general, the final rule mandates that refiners and importers of diesel fuel reduce the sulfur content of this fuel to 15 parts per million ("ppm") by June 1, 2006. There are three notable exceptions to this general rule: (1) a provision in the final rule that permits a refiner or importer to produce a maximum of 20 percent of its highway diesel fuel at the current 500 ppm standard between June 1, 2006 and May 31, 2010 (hereinafter referred to as the "phase-in provision"), with the remainder mandated to meet the 15 ppm specification; (2) a provision that provides refiners supplying the "geographic phase-in areas" (i.e., PADD IV) with an additional two years to comply with the gasoline sulfur reduction mandate, provided that all of the refiner's highway diesel fuel output meets the 15 ppm diesel fuel sulfur mandate; and, (3) a small refiner hardship provision, which permits companies that meet the definition of "small refiner" to continue to produce 500 ppm highway diesel fuel until May 31, 2010, provided that the small refiner certifies that ample supplies of 15 ppm highway diesel fuel will be available in its PADD from other suppliers. By May 31, 2010, all highway diesel fuel must meet the 15 ppm sulfur mandate, and all exceptions to the general rule will expire.
As a result of these exceptions to the general 15 ppm sulfur mandate, two different types of highway diesel fuel will be available between mid-2006 and mid-2010. The final rule mandates that 15 ppm diesel fuel and 500 ppm diesel fuel must be segregated throughout the distribution system, including retail diesel fuel outlets.
For diesel fuel marketers, compliance with the final rule is fairly straightforward, at least at first glance. A marketer may choose to sell either 15 ppm diesel fuel or 500 ppm diesel fuel, or both, from its retail outlets. However, as noted above, the two different types of highway diesel fuel may not be commingled. The final rule does not mandate that a marketer sell either or both types of highway diesel fuel -- EPA has left that issue to the marketplace.
There are no diesel fuel testing and sampling mandates imposed on marketers by the final rule. Instead, diesel fuel marketers will be held to a similar standard of liability that exists in other fuels programs -- i.e., maintenance of product transfer documents ("PTDs") from suppliers identifying the product and taking steps to assure that 500 ppm diesel is not sold as 15 ppm diesel at their outlets. The final rule does mandate that labels be affixed to all retail diesel fuel dispensers identifying the type of highway diesel fuel being sold.
In the preamble to the final rule, EPA states that it will consider an additional rulemaking in the coming years to determine whether different sized dispenser nozzles or color-coded dispenser handles or nozzles will be required to assist consumers in distinguishing between the two different types of highway diesel fuel. However, these mandates are not included in the current final rule.
III. Impact of Final Rule on Diesel Marketers
While compliance with the regulatory requirements of the final diesel sulfur rule should not be onerous for diesel fuel marketers, other, non-regulatory impacts of the rule may affect marketers more severely. First, it will be expensive for refiners to upgrade their equipment to make 15 ppm diesel fuel. Faced with this expense, some refiners -- particularly small- and medium-sized refiners -- may choose to reduce their highway diesel fuel production or exit the on-road diesel market entirely. Consequently, the final rule may have the affect of reducing the number of suppliers of diesel fuel across the nation, as well as the amount of highway diesel fuel available.
Second, EPA's decision to grant exceptions to the general 15 ppm mandate will result in two highway diesel fuels being available to marketers between mid-2006 and mid-2010. NACS strongly opposed EPA's exceptions because they will force marketers to either choose one type of highway diesel fuel to carry (thereby limiting the classes of trade that marketers may serve) or install additional tanks and dispensers to carry both types of highway diesel fuel. Whichever option a marketer chooses, it will cost the marketer money, either through lost business or capital investments.
Third, EPA's decision to phase-in the 15 ppm highway sulfur standard will create logistical problems for the diesel fuel distribution system because the two highway diesel fuels must be segregated throughout the system. It remains to be seen whether both fuels will be available in widespread markets, or whether 500 ppm fuel is available only in some areas of the country where the higher sulfur diesel can be transported directly from a refinery to retail outlets by truck.
IV. EPA's Rationale for the Diesel Sulfur Standard
The target of the final rule is emissions of oxides of nitrogen ("NOx") and particulate matter ("PM") from heavy duty vehicles, such as tractor trailers. As part of the final rule, EPA established an emissions standard for heavy duty vehicles (both gasoline- and diesel-powered) that will reduce NOx and PM emissions by 95 percent. EPA accomplishes these reductions by requiring that the engines of Model Year ("MY") 2007 heavy duty vehicles include emissions reduction devices to remove NOx and PM from these vehicles' exhaust.
cont'd
http://www.nacsonline.com/NR/exeres/0000615ekahlbkkqgboantrc/GenUseWithOneCallOut_Resource.asp?NRORIGINALURL=%2fNR%2fexeres%2f2E275E2B-AE24-4CEB-AFC6-1DD2A1E4099C%2ehtm&FRAMELESS=false&NRNODEGUID=%7b2E275E2B-AE24-4CEB-AFC6-1DD2A1E4099C%7d&cookie%5Ftest=1_________________________________________________________________
EPA SITE:
http://www.epa.gov/OMS/regs/fuels/diesel/diesel.htm_________________________________________________________________
NON-ROAD Vehicle Schedule:
The schedule:
Nonroad Phase-In - Final Rule Issued June 29, 2004
Key Compliance Dates:
December 31, 2005 – Each terminal company (or other entity) in the diesel fuel distribution system must register each of its terminal facilities with EPA.
June 1, 2007 – All nonroad diesel, including locomotive and marine (LM) diesel, will be required to have no more than 500 ppm sulfur.
June 1, 2010 – The sulfur limit for nonroad diesel (excluding LM diesel) will be reduced to 15 ppm.
August 1, 2010 – At the terminal level, all NRLM diesel must meet the 500 ppm sulfur standard.
June 1, 2012 – The 15 ppm cap for LM diesel will go into effect, except LM fuel (with up to 500 ppm sulfur) produced by certain exempt refiners.
June 1, 2014 – LM fuel produced by refiners under the rule’s “credit and small refiner” provisions will be required to have no more than 15 ppm sulfur.
Summary:
The new rule consists of two parts. It imposes a program of phased-in emission standards for new, nonroad diesel engines, and it requires a two-step reduction in the sulfur content of nonroad, locomotive and marine (NRLM) diesel fuel. The current, unregulated sulfur level of approximately 3,000 ppm will drop to a 500 ppm limit in June 2007. Then, in June 2010, the sulfur cap for nonroad fuel will be reduced further to 15 ppm, and the same 15 ppm cap will apply to locomotive and marine (LM) fuel two years later in June 2012.
The final version of the rule completely changes the mechanism for ensuring that nonroad diesel, when reduced to 500 ppm sulfur in 2007, will not be used to undermine the benefits of the highway diesel program. The new mechanism is the “designate and track” system. This approach requires refiners to designate all batches of 15 ppm and 500 ppm highway and NRLM diesel into one of eight separate categories. These designations will generally follow the fuel throughout the distribution system down to the point when the fuel exits the terminal. However, downstream parties will have limited ability to change designations. For-hire terminals will need to enter into contractual agreements with their customers to ensure that proper controls apply to the designations (and changes in designations) of fuels stored in the leased tanks.
http://www.ilta.org/Rules&Regs/ulsd.htm
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