While environmental compliance has been a major undercurrent of the petroleum industry for the past 40 years, recent developments in global and U.S. energy policies have the potential to significantly impact the retail fuel industry in 2016. Source will be keeping an eye on these developments this year, focusing on how the issues will impact fuel retailers.
Global Climate Initiatives
In December, 195 countries agreed at the Paris climate conference (COP21) to reduce global warming by limiting the increase in the average global temperature to less than 2°C, with a goal of eventually limiting it to 1.5°C. Countries will be required to report progress on their efforts beginning in 2020. The Oil and Gas Climate Initiative, which is a collaborative energy solutions effort from 10 gas and oil companies, states that the agreement “offers significant opportunity for innovation and investments in lower GHG emission solutions.” While the specifics of how the U.S. will meet the COP21 standard have not yet been disclosed, the policies could drive support for alternative fuels and stricter compliance through equipment design.
U.S. Energy Regulations
Effective Dec. 28, 2015, the U.S. Environmental Protection Agency’s ozone National Ambient Air Quality Standards (NAAQS) were lowered from 75 parts per billion (ppb) to 70 ppb. In addition, the EPA released its final Renewable Fuel Standard volume requirements on Nov. 30. These two policies will have significant implications on the fuel sold on the forecourt and the equipment used to dispense it. By lowering the NAAQS standard, the number of areas designated as “non-attainment” areas is likely to increase, triggering additional regulations for those areas. In comments submitted to the EPA, NACS stated that more stringent ground-level ozone standards could prompt states to require reformulated gasoline in more stations, impose lower Reid Vapor Pressure requirements and possibly retain Stage II recovery requirements. The EPA expects to complete nonattainment designations by October 2017.
Experts with Expert Solutions
Source North America will closely monitor the industry’s response to these environmental compliance initiatives in the coming months and years. With decades of experience delivering solutions through timely, practical fuel equipment solutions and innovative services, Source’s team of industry experts can guide fuel marketers through whatever changes may come. For assistance, please call (800) 572-5578.