Archive This article is from our archive and might not display correctly. Download PDF
Late last week (March 29) the U.S. Environmental Protection Agency (EPA) announced new rules to bring U.S. emissions in line with Europe and Japan on sulphur emissions from cars and refineries. This is a politically provocative move from President Barack Obama and it has drawn sharp criticism from the powerful U.S. oil industry and Republican congressmen.
Its significance lies in that the EPA has proposed to lower the limit on sulphur emissions from 30 parts per million to 10 parts per million by 2017, a reduction of 60% on current levels, for what is the world's biggest emitter of greenhouse gases. It may also reflect an emboldened President Obama who, off the back of his recent re- election, has felt inspired to pursue some of the more controversial policies that he promised upon his 2008 election without fear of an electoral backlash. In America, climate change - even in this tacit form - is one of them.
In typically American fashion, the headlines have focused upon the financial impact that this move will have upon the oil industry, and its many millions of customers in a sluggish economic recovery. The director of the American Petroleum Institute's Downstream Group, Bob Greco, has accused the Obama administration of endangering jobs through an unnecessary "tsunami of federal regulations" whilst the main group for refiners, the American Fuel and Petrochemical Manufacturers, has argued that the proposed standards are "too burdensome" on the industry. However, 29 of these refineries already have to comply with the proposed standards in California, where they are already effective.
Meanwhile in Congress, the Republican Chairman for the Energy and Commerce Committee Fred Upton has accused the government of being "out of touch", arguing that this move will hurt the most vulnerable individuals and families in society. Many American people are already struggling paying $4 a gallon at the pumps, with this price increase reported to be in the region of 9 cents per gallon. This is a familiar argument in Britain, but with petrol prices at roughly $8 a gallon over here, sympathy is probably limited.
For its part, the EPA has strongly denied these claims, with the White House arguing that the new regulations will save money in the long run through reduced healthcare costs and universal standards for car manufacturers. The EPA has estimated that the proposed rules would put less than one cent on the price of gas, whilst removing the emissions equivalent of 33 million cars from American roads by 2017, a number greater than the total amount of cars on the road in Britain last year. With more than a third of all U.S. neighbourhoods suffering air pollution above government limits, this would save 2,400 lives and $8- $23 billion in healthcare costs by 2030, a measure that most of us would gladly vote for. Even the big auto manufacturers support the proposed rules, as it would allow them to standardise the components that they supply with their cars to the U.S. market. In this situation, surely everybody is a winner?
Typically, the oil industry has argued that the expense of the required changes to refinery equipment would outweigh all of these savings, with an annual compliance cost to the industry of $2.4 billion. The White House has countered these claims by arguing that only 16 of America's 111 refineries need new equipment to comply. Josh Earnest, deputy White House press secretary, told reporters that this is a small price to pay "for tens of thousands fewer cases of respiratory ailments like asthma in children and thousands of lives saved".
Alongside the main Fuel Efficiency Act from the first Obama government - which sought to double American fuel efficiency to at least 40mpg - it is hoped that this latest piece of legislation has finally signalled the determination of the U.S. to begin tackling the problems associated with fuel inefficiency, namely pollution and its associated environmental health risks. However, in a country where the car is a symbol of individual freedom, the oil industry retains its strong political influence, meaning that there is sadly still a long road ahead.