To amend the Clean Air Act to reduce the proliferation of boutique fuels, and for other purposes.

April 5, 2005

Mr. BLUNT (for himself, Mr. RYAN of Wisconsin, Mr. GREEN of Wisconsin, Mr. ROGERS of Michigan, Mr. PETRI, Mr. SENSENBRENNER, Mr. KIRK, Mr. NEY, Mr. BRADY of Texas, Mr. ENGLISH of Pennsylvania, Mr. WICKER, Mr. BONILLA, Mr. SHADEGG, Mr. CANTOR, and Mr. ISSA) introduced the following bill; which was referred to the Committee on Energy and Commerce

To amend the Clean Air Act to reduce the proliferation of boutique fuels, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Boutique Fuels Reduction Act of 2005'.

SEC. 2. TEMPORARY WAIVERS DURING SUPPLY EMERGENCIES.

Section 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 7545(c)(4)(C)) is amended by inserting `(i)' after `(C)' and by adding the following new clauses at the end thereof:

`(ii) The Administrator may temporarily waive a control or prohibition respecting the use of a fuel or fuel additive required or regulated by the Administrator pursuant to subsection (c), (h), (i), (k), or (m) of this section or prescribed in an applicable implementation plan under section 110 approved by the Administrator under clause (i) of this subparagraph if, after consultation with, and concurrence by, the Secretary of Energy, the Administrator determines that--

`(I) extreme and unusual fuel or fuel additive supply circumstances exist in a State or region of the Nation which prevent the distribution of an adequate supply of the fuel or fuel additive to consumers;

`(II) such extreme and unusual fuel and fuel additive supply circumstances are the result of a natural disaster, an Act of God, a pipeline or refinery equipment failure, or another event that could not reasonably have been foreseen or prevented and not the lack of prudent planning on the part of the suppliers of the fuel or fuel additive to such State or region; and

`(III) it is in the public interest to grant the waiver (for example, when a waiver is necessary to meet projected temporary shortfalls in the supply of the fuel or fuel additive in a State or region of the Nation which cannot otherwise be compensated for).

`(iii) If the Administrator makes the determinations required under clause (ii), such a temporary extreme and unusual fuel and fuel additive supply circumstances waiver shall be permitted only if--

`(I) the waiver applies to the smallest geographic area necessary to address the extreme and unusual fuel and fuel additive supply circumstances;

`(II) the waiver is effective for a period of 20 calendar days or, if the Administrator determines that a shorter waiver period is adequate, for the shortest practicable time period necessary to permit the correction of the extreme and unusual fuel and fuel additive supply circumstances and to mitigate impact on air quality;

`(III) the waiver permits a transitional period, the exact duration of which shall be determined by the Administrator, after the termination of the temporary waiver to permit wholesalers and retailers to blend down their wholesale and retail inventory;

`(IV) the waiver applies to all persons in the motor fuel distribution system; and

`(V) the Administrator has given public notice to all parties in the motor fuel distribution system, local and State regulators, public interest groups, and consumers in the State or region to be covered by the waiver.

The term `motor fuel distribution system' as used in this clause shall be defined by the Administrator through rulemaking.

`(iv) Within 180 days of the date of the enactment of the Boutique Fuels Reduction Act of 2005, the Administrator shall promulgate regulations to implement clauses (ii) and (iii).

`(v) Nothing in this Act shall--

`(I) limit or otherwise affect the application of any other waiver authority of the Administrator pursuant to this section or pursuant to a regulation promulgated pursuant to this section; and

`(II) subject any State or person to an enforcement action, penalties, or liability solely arising from actions taken pursuant to the issuance of a waiver under this subparagraph.'.

SEC. 3. CAP ON NUMBER OF BOUTIQUE FUELS.

Section 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 7545(c)(4)), as amended by section 2, is further amended by adding at the end the following:

`(vi)(I) The Administrator shall have no authority, when considering a State implementation plan or a State implementation plan revision under this subparagraph, to approve any fuel if the effect of such approval would be to increase the total number of fuels approved and fully implemented as of September 1, 2004 in all State implementation plans.

`(II) Except for a fuel with a summertime Reid Vapor Pressure of 7.0 pounds per square inch, the Administrator shall have no authority, when considering any particular State's implementation plan or a revision to that State's implementation plan under this subparagraph, to approve any fuel unless that fuel was, as of the date of such consideration, approved and fully implemented in at least 1 State implementation plan in the applicable Petroleum Administration for Defense District. The preceding sentence shall not limit the Administrator's authority to approve any new fuel in any such plan or plan revision if such new fuel replaces an existing fuel without increasing the total number of fuels approved and fully implemented as of September 1, 2004 in all State implementation plans.

`(III) Nothing in this clause shall be construed to prohibit a State from requiring the use of any fuel additive registered in accordance with subsection (b), including any fuel additive registered in accordance with subsection (b) after the enactment of this subclause.'.

SEC. 4. STUDY AND REPORT TO CONGRESS ON BOUTIQUE FUELS.

(a) Joint Study- The Administrator and the Secretary shall undertake a study of the effects on air quality, on the number of fuel blends, on fuel availability, on fuel fungibility, and on fuel costs of the State plan provisions adopted pursuant to section 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 7545(c)(4)(C)).

(b) Focus of Study- The primary focus of the study required under (a) shall be to determine how to develop a Federal fuels system that maximizes motor fuel fungibility and supply, preserves air quality standards, and reduces motor fuel price volatility that results from the proliferation of boutique fuels, and to recommend to Congress such legislative changes as are necessary to implement such a system. In addition, the study shall examine the need for additional, cleaner motor fuel reformulations to assist states in complying with the ozone National Ambient Air Quality Standard.

(c) Study Areas of Responsibility- In carrying out the study required by this section, the Administrator shall coordinate obtaining comments from affected parties interested in the air quality impact assessment portion of the study, and the Secretary shall coordinate obtaining comments from affected parties interested in the fuel availability, number of fuel blends, fuel fungibility and fuel costs portion of the study.

(d) Public Participation- The Administrator and the Secretary shall appoint a task force of interested parties, including but not limited to representatives of Federal, State and local governments, fuel manufacturers and suppliers and public interest groups, to provide information to the Administrator and the Secretary and to assist in the development of the recommendations to be included in the report to Congress under (e).

(e) Report to Congress- The Administrator and the Secretary jointly shall submit the results of the study required by this section in a report to the Congress not later than 12 months after the date of the enactment of this Act, together with any recommended regulatory and legislative changes. Such report shall be submitted to the Committee on Energy and Commerce of the House of Representatives and the Committee on Environment and Public Works of the Senate.

(f) Authorization of Appropriations- There is authorized to be appropriated jointly to the Administrator and the Secretary $500,000 for the completion of the study required under this section.

SEC. 5. DEFINITIONS.

In this Act:

(1) The term `Administrator' means the Administrator of the Environmental Protection Agency.

(2) The term `Secretary' means the Secretary of Energy.

END