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Dear PEI Member:

The U.S. Environmental Protection Agency (EPA) launched a rulemaking process March 12 to grant E15 a summertime fuel volatility waiver that would allow the blend to be sold year-round nationwide. A public hearing on the proposal will be held March 29 in Ypsilanti, Michigan. Details on the public comment period will be announced when the proposal is published in the Federal Register.

Although even minor rulemakings typically take at least 90 days, EPA Administrator Andrew Wheeler said in a press release, “Consistent with President Trump’s direction, EPA is working to propose and finalize these changes by the summer driving season.”

A fuel's volatility is typically measured by its Reid vapor pressure (RVP). In most jurisdictions, the maximum RVP for non-flex fuel vehicles from June 1 to Sept. 15 is 9 psi. E10’s RVP is about 10. However, using its authority under the Clean Air Act (CAA), the EPA in 1991 granted E10 a 1-pound waiver, thereby putting the fuel under the summertime limit.

E15 has an RVP comparable to that of E10. However, EPA’s 2011 approval of E15 for model-year 2001 and newer vehicles did not include a summertime RVP waiver. The proposed rule would eliminate this disparate treatment by granting E15 a 1-pound waiver, thereby making the year-round sale of the higher-blend fuel legal.

Ethanol advocacy groups praised the proposal.

“Today’s proposed rule means EPA is one step closer to making good on President Trump’s promise to allow year-round sales of E15,” said Geoff Cooper, president and CEO of the Renewable Fuels Association (RFA).

“This rule is a critical milestone for rural Americans who make renewable biofuels and for all American drivers, who may soon have a cleaner, more affordable, higher-octane fuel all year long,” said Growth Energy CEO Emily Skor in a statement.

However, the American Petroleum Institute (API) called the step a “lose-lose” for American consumers, noting that older vehicles are not warranted for E15, and the fuel could “damage vehicle engines and fuel systems—potentially leaving Americans to pay expensive car repair bills due to bad policy out of Washington.”

E15 Rulemaking Announced

California Bans Two Fuel Marketers

PEI Women Conference Early Bird Deadline

Vermont Settles MTBE Litigation

DOL Proposes New Overtime Rule

Respond to this Newsletter

by e-mail to the editor, Rick Long at rlong@pei.org

or join the discussion in the  Petroleum Equipment Forum

The Petroleum Marketers Association of America (PMAA) agreed, saying, “[S]erious compatibility issues with UST [underground storage tank] systems and automobiles must be resolved before E15 can be safely sold year-round.”

Ethanol advocates worry that the E15 rulemaking could be delayed because the proposal also provides complicated and controversial new safeguards against manipulation of the market for renewable identification numbers (RINs), the mechanism used to track the production, use, and trading of biofuels under the Renewable Fuel Standard. RFA has signaled it will encourage the EPA to separate the E15 and RIN reform provisions to allow faster action on E15.

Even assuming the E15 rulemaking is concluded without major changes, a court fight is likely. Opponents claim the EPA’s authority to grant a waiver under the CAA extends only to E10. If so, Congress would have to amend the CAA to include E15 before the higher-blend fuel could be sold year-round.

CALIFORNIA CONDITIONALLY BANS TWO FROM RETAIL FUELING BUSINESS
The State of California announced the settlement of a 13-year State Water Resources Control Board investigation of two businessmen accused of serious UST violations.

The alleged violations by Azad Amiri and Sarbjit S. Kang, which occurred at 11 fueling facilities in six northern California counties, included operating facilities without permits, failing to conduct required testing and maintenance, failing to monitor for leaks, and unlawfully abandoning tanks. The defendants also were alleged to have engaged in deceptive business practices to avoid liability, such as creating shell companies and abusing the discovery process.

Under the settlement, Amiri and Kang can only own or operate fueling facilities in the future if they meet a series of strict conditions and requirements.

Amiri, Kang and 13 other defendants also must pay a combined $1 million fine to the State Water Pollution Cleanup and Abatement account, with the possibility of an additional $3.25 million penalty if additional violations occur in the next 5 years.

PEI WOMEN CONFERENCE EARLY BIRD DEADLINE
Tomorrow, Wednesday, March 20, is the deadline for early bird registration for the 2019 PEI Women Conference, May 1-3 at the Saguaro Scottsdale Hotel in Scottsdale, Arizona.

General sessions at this year’s conference feature an Emmy Award-winning documentary filmmaker, an author of four Pulitzer-nominated books (including the Oprah pick Hard Won Wisdom), and PEI Executive Vice President Rick Long’s surprising predictions about the future of our industry. Unparalleled networking opportunities and stimulating roundtable discussions will boost the event’s energy—and your takeaways—even more.

Registration fees through March 20 are $495 for PEI Women Members ($595 for non-PEI Women members). Beginning March 21, rates increase by $100. An optional pre-conference trolley tour of Old Town Scottsdale is $55.

For all the details and registration and hotel links, click here.

Register today—or  forward this to someone in your organization who could benefit from this special conference.

VERMONT SETTLES MTBE LITIGATION
Vermont Attorney General T.J. Donovan announced the settlement of litigation charging more than two dozen of the nation’s largest refiners with knowingly and unlawfully polluting groundwater with the gasoline additive methyl tertiary butyl ether (MTBE). In return for a payment of $3.8 million, Vermont has dismissed its remaining claims against the defendants.

MTBE is a synthetic chemical that refiners began blending into gasoline in 1979. Vermont banned the use of MTBE as a gasoline additive in 2007, after the chemical was identified as a known animal carcinogen and a possible human carcinogen. Studies also have linked MTBE to other adverse health effects.

Under the terms of the settlement, Vermont may still pursue relief under the state’s environmental clean-up laws for any newly discovered MTBE contamination.

EPA ISSUES UST COMPLIANCE ADVISORY
The EPA Office of Underground Storage Tanks (OUST) issued a compliance advisory March 15 reminding owners and operators in Indian Country and jurisdictions without state program approval (SPA) of the requirements for periodic inspection of overfill prevention equipment and periodic testing of spill prevention equipment and containment sumps used for interstitial monitoring of piping.

The 2015 federal underground storage tank (UST) regulations required owners and operators in Indian Country and non-SPA states and territories to complete the first of these tests and inspections by Oct. 13, 2018. In the compliance advisory, EPA OUST notes that completing these requirements on time is a concern at some UST facilities.

DOL PROPOSES OVERTIME RULE
The U.S. Department of Labor (DOL) announced a proposal March 7 to increase federal overtime pay requirements, but at a level well below that developed in 2016 by the Obama administration (see June 1, 2016 TL).

The Obama-era rule, which was overturned Aug. 31, 2017 by a federal district court, would have raised the minimum salary threshold for the Fair Labor Standards Act’s “white collar exemption” from $23,660 to $47,476 per year.

The new rulemaking proposes increasing the threshold to $35,308. It also replaces automatic threshold increases with periodic reviews. Additional increases would require a notice-and-comment rulemaking process.

The DOL estimates the proposed rule will make 1 million additional U.S. workers eligible for overtime. The 2016 rule would have granted overtime eligibility to an estimated 4.7 million more Americans. Once the rule is published in the Federal Register, the public will have 60 days to submit comments.

DEATHS
Luke James Clements, 96, died Feb. 21, 2019. Clements worked in engineering and sales with Dover Corporation/OPW for 42 years. He was preceded in death by his wife of 51 years, Gloria. Survivors include sons Luke (an employee of Petroleum Solutions Inc.), Christopher and Jeffrey, seven grandchildren and one great grandchild.
Thomas S. Katich, 70, the co-founder of ESCO Services Inc., died Feb. 2, 2019, the 40th anniversary of ESCO. Survivors include Joyce, his wife of 48 years; son Matt and wife Andrea; and three grandchildren, Carter, Grant and Kate.

BRIEFLY NOTED
“In 2016, light-duty vehicles accounted for 58.5% of transportation energy use while medium/heavy-duty trucks and buses accounted for 23.9%. Air transportation was the only other mode accounting for more than 5% of transportation energy use. The majority of fuel used in transportation was gasoline and diesel fuel, used not only for highway vehicles but also in rail, water and air modes.”—Department of Energy, March 11, 2019
“Nonfarm job openings reached another new all-time high in January, with 7,581,000 postings for the month. In addition, there were more job openings in the U.S. economy than the number of people looking for work (6,535,000 in January and 6,235,000 in February) for the 12th straight month.”—Monday Economic Report, March 18, 2019
“The Trump White House is again seeking to sharply reduce the EPA’s budget, an opening offer that Congress isn’t likely to follow but signals the administration’s continued desire to shrink the agency. The administration’s request, the broad strokes of which were released March 11, would seek $6.1 billion for the Environmental Protection Agency in fiscal year 2020, a cut of more than $2 billion or 31 percent, compared with the estimated $8.8 billion in fiscal year 2019.”—Bloomberg Environment, March 11, 2019

MEMBER NEWS
Bennett Pump Co. announced that its hydrogen fuel dispensers have been selected for the first retail hydrogen fueling station in Saudi Arabia. The station is scheduled to open in the second quarter of 2019.
ESCO Services Inc. and ESCO Manufacturing Inc. named Thomas C. Butler national sales manager. Butler has 19 years of experience in the petroleum industry as an electronics technician and a sales representative.
Leighton O’Brien promoted Mahir Hodzic to operations manager for Europe and Africa. Hodzic was most recently business development engineer for the Asia/Pacific region.
S. Bravo Systems, Inc. named Micah Nelson vice president, strategic growth. He joined Bravo as national sales manager in 2011.

MEMBERSHIP APPLICATIONS
Alabama distributor. Fueling Solutions Inc., 1021 Gadsden Hwy., Birmingham, AL 35235, applied for distributor division membership. Dale Simmons is managing partner and secretary-treasurer for the company, which was established in 2017. Fueling Solutions Inc. sells, services and installs c-store and emergency generator fuel supply equipment, tanks, dispensers, POS systems, piping, lighting, security cameras and back-office scanning equipment. Sponsored for PEI membership by Gary Estes, Estes Equipment Company Inc., Chattanooga, Tennessee.
www.fueling-solutions.com

Alaska service company. Frontier Fuel Service LLC, 7362 W. Parks Hwy. #235, Wasilla, AK 99623, applied for service and construction division membership. Aimee Campbell is office manager for the firm, which was established in 2016. Frontier Fuel Service LLC is a bulk fuel facility service and training company that also does compliance, safety and environmental training, tank farm inspections, marine header system pressure testing, fuel dispenser installation, POS system installation and service, and deconstruction of decommissioned fuel tanks. Sponsored for PEI membership by William Mascott, Mascott Equipment Company, Inc., Portland, Oregon.
www.frontierfuelservice.com

Mississippi service company. Parish Petroleum LLC, 1089 Old Hwy 27 Rd. 1, Crystal Springs, MS 39059, applied for service and construction division membership. Wayne Parish is owner of the firm, which was established in 2017. Parish Petroleum LLC performs Mississippi Department of Environmental Quality (MDEQ) testing and provides installation and removal services. Sponsored for PEI membership by Alex Ralston, Petcon Inc., Jackson, Mississippi.

ADMITTED TO PEI

• Tri-State Service Station Maintenance Inc., Middletown, Ohio (service & construction)
• SGI Builders Inc., Riviera Beach, Florida (service & construction)
• Petroleum Equipment Services Ltd., Cayo District, Belize (service & construction)
• Simon Surfaces, Youngstown, Ohio (service & construction)

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Petroleum Equipment Institute
P. O. Box 2380
Tulsa, OK 74101-2380

The TulsaLetter (ISSN 0193-9467) is published two or three times each month by the Petroleum Equipment Institute. Richard C. Long, Editor. Opinions expressed are the opinions of the Editor. Basic circulation confined to PEI members.