THE ENVIRONMENTAL Protection Agency's (EPA) final rule requiring a reduction in diesel fuel sulfur content from an average of about 500 parts per million (ppm) to 15 ppm does not go into effect until January 2007. However, the companies that transport and store diesel fuel may need every bit of five years of lead time to solve what seems at the moment to be an unsolvable problem, according to information from the Independent Liquid Terminals Association (ILTA).
The issue is contamination of the product. If the standard is 15 ppm, it takes very little product interface to contaminate low sulfur diesel in a pipeline, storage tank, or tank truck, ILTA says.
The contamination issue for terminals involves much more than simply maintaining extremely clean tanks and piping, which is a formidable task in itself, according to ILTA. The issue cannot be resolved simply by selling contaminated product as an off-spec fuel suitable for off-road use.
The EPA rule provides that no more than 20% of low sulfur on-road diesel volumes can be downgraded to a sulfur content higher than 15 ppm. Moreover, the market for off-spec fuel will decline in 2009, when diesel fuel for off-road use must also meet the 15 ppm standard.
Also, the issue cannot be resolved simply by turning over the contaminated fuel to a company that reprocesses transmix, tank bottom sludge, and similar materials. Reprocessing cannot remove the sulfur. Only refineries have the capability of salvaging contaminated low sulfur fuel by removing enough sulfur to bring the content back down to the 15 ppm level, ILTA points out.
In addition, the issue also involves the question of determining liability for contamination. If a retail outlet discovers that it is selling off-spec fuel, how will liability be determined, ILTA asks.
A continuous sampling procedure must be employed to protect each participant in the chain of possession. Today, if a terminal were handling 15 ppm diesel fuel, how would it determine that it is receiving 15 ppm product from its bulk transport suppliers? It would send a sample to a laboratory and then wait for up to three days to receive the results, ILTA says.
Trucking companies would also need to verify the quality of the product they receive from terminals, and they would face the same problem. Will adequate sampling procedures be commercially available by 2007, ILTA asks.
Another problem is related to terminals located in northern states. They may not have the ability to continue to cut diesel fuel with kerosene to prevent the diesel from becoming too sluggish during very cold weather. It is highly unlikely that 15 ppm kerosene will be transported by pipeline to terminals in the northern states. It probably cannot be transported economically by truck in sufficient quantities.
ILTA also questions: Will adequate supplies of 15 ppm kerosene be available? If so, will terminals need to invest in expensive, segregated storage and piping systems to keep their kerosene supplies free of contamination pending the onset of cold weather?
In the coming months, ILTA will be assessing these questions, consulting other trade associations, and seeking expert advice on possible solutions.