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Posted on  

June 14, 2000

No Good Explanation, Says EPA

Federal officials met for two hours with refiners Monday, and the EPA's top air pollution official said he heard ``no good explanation'' for soaring gasoline prices in Midwest cities where new requirements require cleaner-burning gas.

The Environmental Protection Agency and Energy Department said field inspectors were sent to the Milwaukee and Chicago areas to investigate price increases in recent weeks of 30 to 50 cents a gallon. They focused on both refining and distribution, one official said.

Officials from eight major oil refineries sat in on the EPA and Energy Department meeting, and further sessions were held later with individual companies.

``We see no good explanation for why the (high) prices exist. ... We think the prices are unfair and inappropriate,'' Robert Perciasepe, the EPA's assistant administrator for air and pollution programs, told reporters after the meeting.

The Energy Department released data that showed prices of reformulated gasoline were on average 9 cents a gallon higher as of June 5 than conventional gasoline nationwide, but 23 cents higher in the Midwest.

Perciasepe and Melanie Kenderdine, a senior DOE official who also attended the meeting, would not characterize explanations given by industry officials except to say there was general discussion about supply and distribution problems.

``We're suspicious of gouging,'' EPA spokesman Dave Cohen said earlier.

The Renewable Fuels Association, which represents the ethanol industry, blamed the refiners for not building adequate stocks of reformulated gasoline and the EPA for ``failure to make appropriate regulatory changes that would reduce the cost of producing RFG in Chicago and Milwaukee.''

EPA officials said they were puzzled as to why the price difference between conventional and the cleaner-burning gasoline was as wide as it has been in the Midwestern areas requiring the cleaner gasoline.

``We do not believe that the cleaner-burning gasoline is causing the major price increases,'' said Perciasepe.



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