Regulation of Fuels and Fuel Additives: Renewable Fuel Standard ...

e $1.43 per gallon, the average of the conversion costs for captive, ethylene cracker and
propylene oxide MTBE plants. This projected percent of MTBE plant conversion results
in 0.84 gallons of alkylate produced for each gallon of MTBE no longer produced.
The alkylate production cost is adjusted by PADD to account for the blending
octane of alkylate, which varies by 1 to 2 cents per gallon depending on the value of
octane in each PADD. Including its octane value, the cost of producing alkylate varies
from $1.38 to $ 1.41 per gallon.
For further information on production of alkylate from MTBE feedstocks, see
section 7.4.4 of the RIA.
4. Changes In Refinery Produced Gasoline Volume And Its Costs
In the sections above, we estimated changes in gasoline volume and the cost
associated with those volume changes for ethanol, MTBE, alkylate and butane. As these
various gasoline blendstocks are added to or removed from the gasoline pool, they affect
the refinery production of gasoline (or oxygenate blendstock).
To estimate the changes in refinery gasoline production volumes, it was necessary
to balance the total energy production of each control case to the reference case. The
energy content of the reference case was estimated by multiplying the volumetric energy
content of each gasoline pool blendstock, including MTBE, ethanol and refinery
produced gasoline, by the associated gallons.
The increase or decrease in ethanol content in summertime RFG assumed under
the different scenarios resulted in the change in the volumes of butane in RFG as
described above. We identified that the increase or decrease in ethanol in wintertime
RFG and CG could cause reductions or increases in the amount of butanes blended into
wintertime gasoline. Wintertime gasoline is limited in vapor pressure by the American
Standard for Testing Materials (ASTM) RVP and V/L (vapor-liquid) standards.
According to a refiner with extensive refining capacity, and also Jacobs Engineering, a
refining industry consulting firm, refineries are blending their wintertime gasoline up to
those standards today and are limited from blending more butane available to them. If
this is the case, for each gallon of summertime RFG and wintertime RFG and CG
blended with ethanol 2 percent of the base gasoline volume would be lost in terms of
butane removed. However, some refineries may have room to blend more butane. Also,
we are aware that some states offer 1 PSI waivers for blending of ethanol into wintertime
gasoline, presumably to accommodate splash blending of ethanol. 78 Consequently, it
may be possible to accommodate the 1 PSI vapor pressure increase without forcing the
removal of some or all of this butane. For this reason we assessed the costs as a range, on
the upper end assuming that butane content would have to be removed to account for new
ethanol blended into summertime RFG and wintertime RFG and CG , and on the low end
78 Most people are aware of the 1 PSI RVP waiver that ethanol is provided for the summertime, but some
states offer a similar waiver to ethanol for wintertime blending as well.
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