Order Code RL31912
CRS Report for Congress
Received through the CRS Web
Renewable Fuels and MTBE: Side-by-Side
Comparison of the House and Senate Energy Bills
and the Conference Report on H.R. 6
Updated November 18, 2003
James E. McCarthy
Specialist in Environmental Policy
Mary E. Tiemann
Specialist in Environmental Policy
Brent D. Yacobucci
Analyst in Energy Policy
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

---

Renewable Fuels and MTBE: Side-by-Side Comparison
of House and Senate Energy Bills and the Conference
Report on H.R. 6
Summary
This report compares the energy bill conference report provisions dealing with
ethanol and with the gasoline additive methyl tertiary butyl ether (MTBE) to the
House and Senate versions of the same legislation. The bills considered are all
numbered H.R. 6. The House passed its version April 11, 2003; the Senate, July 31.
The conference committee approved its version November 17; the House agreed to
the conference report November 18.
All three versions would repeal the existing Clean Air Act requirement that
reformulated gasoline (RFG) contain at least 2% oxygen, a requirement that led
refiners and importers to use MTBE, and to a lesser extent ethanol, in their RFG. In
place of this requirement, all three bills would provide a major new stimulus for the
use of ethanol – a provision that the annual production of motor fuels contain at least
5 billion gallons of renewable fuel (more than double the current production of
ethanol) in roughly 10 years. In addition, the bills contain similar provisions that:
require that the reductions in emissions of toxic substances achieved by RFG be
maintained; authorize grants to assist merchant MTBE production facilities in
converting to the production of other fuel additives (although the conference report
provides nearly triple the amount provided by either the House or Senate versions);
authorize loan guarantees for the construction of facilities to produce ethanol from
municipal solid waste; allow ethanol credit trading among refiners and importers of
fuels; and provide a “safe harbor” from product liability lawsuits for producers of
ethanol and other renewable fuels.
Major issues the bills handle differently include: whether to ban MTBE (the
Senate bill would have done so within 4 years, with some exceptions, while the
conference report allows 11 years and gives the President authority to determine that
it should not be banned); whether to grant MTBE producers -- in addition to ethanol
producers -- a safe harbor from product liability lawsuits (the conference report does,
the Senate bill did not); whether to require manufacturers of fuels and fuel additives
to test their impacts on public health and the environment (the Senate bill did so, the
conference report does not); and whether to allow EPA to control or prohibit fuels
and fuel additives in order to protect water quality (again present in the Senate bill,
but not in the conference report).
This report will not be updated.

---

Renewable Fuels and MTBE: Side-by-Side
Comparison of House and Senate Energy
Bills and the Conference Report on H.R. 61
This report compares the provisions dealing with renewable fuel (e.g., ethanol)
and with the gasoline additive methyl tertiary butyl ether (MTBE) in the House and
Senate versions of comprehensive energy legislation and the conference report
reconciling the two. The bills compared in this report are all numbered H.R. 6. The
House version passed the House April 11, 2003. The Senate version passed the
Senate July 31, 2003. The final draft of the conference report (H.Rept. 108-375) was
approved by the conferees November 17;2 the House approved the report November
18. This report does not address other provisions of the energy bill, including ethanol
tax issues; for an overview of these provisions, see CRS Issue Brief IB10116, Energy
Policy: The Continuing Debate.
Under the Clean Air Act Amendments of 1990, gasoline sold in numerous areas
of the country with poor air quality must contain MTBE, ethanol, or other substances
containing oxygen as a means of improving combustion and reducing emissions of
ozone-forming compounds and carbon monoxide. The Act has two programs that
require the use of oxygenates, but the more significant of the two is the reformulated
gasoline (RFG) program, which took effect January 1, 1995. Under the reformulated
gasoline program, areas with “severe” or “extreme” ozone pollution (90 counties
with a combined population of 64.8 million) must use reformulated gasoline; areas
with less severe ozone pollution may opt into the program as well, and many have.
In all, portions of 17 states and the District of Columbia use reformulated gasoline;
a little more than 30% of the gasoline sold in the United States is RFG.
In the mid-1990s, the addition of MTBE to RFG and its use in conventional
gasoline became controversial. The additive has been implicated in numerous
incidents of ground water contamination, and 17 states have taken steps to ban or
regulate its use. The most significant of these bans (in California and New York)
take effect at the end of 2003, leading many to suggest that Congress revisit the issue
before then to modify the oxygenate requirement and set more uniform national
requirements regarding MTBE and its potential replacements (principally ethanol).
All three versions of H.R. 6 would repeal the Clean Air Act requirement that
reformulated gasoline contain at least 2% oxygen – the requirement that forces
1 The bills address Clean Air Act, renewable fuel, and ground water cleanup issues. Of the
three authors of this report, Jim McCarthy handles the Clean Air Act; Brent Yacobucci,
renewable fuels; and Mary Tiemann, ground water and underground storage tank issues.
2The final version of the conference report was released November 18, 2003.

---

refiners and importers to use MTBE, ethanol, or other oxygenates in their RFG. In
place of this requirement, all three versions would provide a major new stimulus to
promote the use of ethanol – a provision that the annual production of gasoline
contain at least 5 billion gallons of renewable fuel (more than double the current
production of ethanol). The conference version, like the Senate bill, requires this
level in 2012.
The bills use the term “renewable fuel” rather than ethanol, so the 5 billion
gallon requirement could be met by other fuels. In fact, all three versions of the bill
specifically include natural gas produced from landfills, sewage treatment plants,
feedlots, and other decaying organic matter in the definition. The renewable fuel
definition also clearly encompasses biodiesel, which can be made from soy beans or
vegetable-based cooking oils. However, ethanol is the only renewable motor fuel
currently being produced in significant quantities. In 2002, roughly 2.1 billion
gallons of ethanol were blended with gasoline. Biodiesel, the next most significant
renewable motor fuel, is consumed at a rate of about 50 million gallons annually,
only 2 or 3% of the amount of ethanol consumed.3
Besides the oxygenate and renewable fuel provisions, the bills are similar in
requiring that reductions in emissions of toxic substances achieved by RFG be
maintained; they all authorize grants to assist merchant MTBE production facilities
in converting to the production of other fuel additives (although the conference report
authorizes $2 billion in such assistance, as compared to $750 million in both the
House and Senate versions); they each would allow ethanol credit trading among
refiners and importers of fuels; and they each would provide a “safe harbor” from
product liability lawsuits for producers of ethanol and other renewable fuels.
Major issues the bills handled differently included:
•
whether to ban MTBE (the Senate bill would have done so within 4 years,
with some exceptions, while the House bill would not have banned the
substance; the conference report allows 11 years and gives the President
authority to determine that it should not be banned);
•
whether to grant MTBE producers – in addition to ethanol producers – a
safe harbor (the Senate bill did not, but the House bill and the conference
report do so);
•
whether to require manufacturers of fuels and fuel additives to test their
impacts on public health and the environment (the Senate bill would have
done so, the House bill and the conference report do not);
•
whether to allow EPA to control or prohibit fuels and fuel additives in
order to protect water quality (again present in the Senate bill, but not in
the House bill or the conference report); and
3For additional information on ethanol and biodiesel, see CRS Reports RL30758, Alternative
Transportation Fuels and Vehicles: Energy, Environment, and Development Issues, and
RL30369, Fuel Ethanol: Background and Public Policy Issues.

---

•
how much to authorize for MTBE cleanup (the conference report
authorizes $1 billion for cleanup of fuels containing MTBE or other
oxygenates and another $1 billion for releases from underground storage
tanks generally – substantially more than either the House or Senate bill).
In addition, the conference report includes extensive amendments to the underground
storage tank (UST) regulatory program and the leaking underground storage tank
(LUST) program. The Senate bill contained some UST and LUST provisions, but
the conference report goes substantially farther, essentially including the language of
H.R. 3335, the Underground Storage Tank Compliance Act of 2003. It adds new
tank inspection and operator training requirements; prohibits fuel delivery to
ineligible tanks; expands UST requirements for federal facilities; and requires EPA,
with Indian tribes, to develop and implement a strategy to address releases on Tribal
lands. The bill authorizes states to use funds from the LUST Trust Fund to help
owners or operators pay the costs of remediating tank leaks in cases of financial
hardship It also authorizes EPA and states to use LUST funds to conduct inspections
and enforce UST release prevention and detection requirements. It authorizes, for
this purpose and for implementing delivery prohibition provisions, $50 million in
LUST funds for each of FY2004-FY2008.
The remainder of this report compares in more detail the MTBE and renewable
motor fuel provisions of the three versions of the bill. (For additional information on
MTBE, see CRS Report 98-290, MTBE in Gasoline: Clean Air and Drinking Water
Issues. For information on ethanol, see CRS Report RL30369, Fuel Ethanol:
Background and Public Policy Issues.)

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Renewable
A new §211(o) is added to the
Similar to the House provision, except
Similar to the House and
Content of
Clean Air Act. Beginning in
that the mandate would be 2.3 billion
Senate versions, except that
Motor Vehicle
2005, motor gasoline must
gallons in 2004, and would increase to
the mandate would be 3.1
Fuel
contain a certain amount of
5.0 billion gallons in 2012.
billion gallons in 2005,
renewable fuel. In 2005, 2.7
[§ 820]
increasing to 5.0 billion
billion gallons of renewable fuel
gallons in 2012.
must be sold annually,
[§1501]
increasing to 5.0 billion gallons
in 2015. After 2015, the
percentage of renewable fuel
required in the motor fuel pool
must be the same as the
percentage required in 2015.
This standard will largely be
met by ethanol, but other
renewable fuels, such as
biodiesel, are eligible. Ethanol
from cellulosic biomass
(including from wood and
agricultural residue, animal
waste, and municipal solid
waste) is granted extra credits
toward fulfilling the program's
requirements. Further, the bill
would establish a credit trading
program to provide flexibility to
refiners and blenders. [§ 17101]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Ban on Use of
No comparable provision.
Not later than 4 years after enactment,
Similar to Senate provision,
MTBE
the use of MTBE in motor vehicle fuel
except that the ban would
is prohibited except in states that
take effect December 31,
specifically authorize it. EPA may
2014. [§1504] Allows the
allow MTBE in motor vehicle fuel in
President to make a
quantities up to 0.5% in cases the
determination, not later than
Administrator determines to be
June 30, 2014, that the
appropriate. [§833(c)]
restrictions on the use of
MTBE shall not take place.
[§1505(b)] Separately,
requires the National
Academy of Sciences to
conduct a review of MTBE’s
beneficial and detrimental
effects on environmental
quality or public health or
welfare, including costs and
benefits. The review shall be
completed by May 31, 2014.
[§1505(a)]
Protection of
No comparable provision.
Amends §211(c)(1) of the Clean Air
No comparable provision.
Water Quality
Act to allow EPA to control or
prohibit fuels and fuel additives in
order to protect water quality, in
addition to current authority based on
protection of air quality. [§833(c)]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Safe Harbor
Provides a “safe harbor” for
Similar to the House bill provision,
Safe harbor covers renewable
renewable fuels and fuels
except that it applies only to
fuels, MTBE, and fuels
containing MTBE (i.e., such
renewable fuels, not MTBE or other
containing them, as in the
fuels cannot be deemed
ethers. [§820(e)]
House bill. Effective as of
defective in design or
September 5, 2003, rather
manufacture by virtue of the
than after the date of
fact that they contain
enactment. The effective date
renewables or MTBE). The
means that the safe harbor
effect of this provision would be
will protect oil and chemical
to protect anyone in the product
industry defendants from
chain, from manufacturers down
defective product claims in
to retailers, from liability for
lawsuits that were filed in
cleanup of MTBE and
New Hampshire and
renewable fuels or for personal
California after that date.
injury or property damage based
[§1502]
on the nature of the product (a
legal approach that has been
used in California to require
refiners to shoulder liability for
MTBE cleanup). With liability
for manufacturing and design
defects ruled out, plaintiffs
would be forced to demonstrate
negligence in the handling of
such fuels, a more difficult legal
standard to meet. Applies to
claims filed after the date of
enactment. [§ 17102]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
MTBE
Amends §211(c) of the Clean
Similar provision, but authorizes $250
Similar provision, but
Transition
Air Act to authorize $250
million for each of FY 2003-2005.
authorizes $250 million for
Assistance
million in each of FY 2004-
[§833(c)]
each of FY 2005-2012. Adds
2006 for grants to assist
renewable fuels to the
merchant U.S. producers of
products eligible for
MTBE in converting to the
conversion assistance.
production of iso-octane and
[§1503] The conference
alkylates. Amounts to remain
report also authorizes $850
available until expended. The
million total for FY2004
Secretary of Energy may make
through FY2006 for
grants available for conversion
conversion and construction
to other fuel additives, unless
of cellulosic ethanol plants.
EPA determines that such
[§1513]
additives may reasonably be
anticipated to endanger public
health or the environment.
[§17103(c)]
Oxygen Content
Amends §211(k) of the Clean
Identical provision. [§834(a)]
Identical provision. [1506(a)]
Air Act to eliminate the
requirement that reformulated
gasoline contain at least 2%
oxygen. Provision takes effect
270 days after enactment,
except in California, where it
takes effect immediately upon
enactment. [§17104(a)]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Toxic Air
Amends §211(k)(1) to require
Identical provisions, but the
Same as the House bill.
Pollutants
that each refinery or importer of
requirements provide an exception for
[§1506(b)]
gasoline maintain the average
California gasoline, which is subject
annual reductions in emissions
to more stringent state requirements.
of toxic air pollutants achieved
[§834(b)]
by the reformulated gasoline it
produced or distributed in 1999
and 2000. This provision is
intended to prevent backsliding,
since the reductions actually
achieved in those years
exceeded the regulatory
requirements. Establishes a
credit trading program for
emissions of toxic air pollutants
[§17104(b)]
Mobile Source
Requires EPA to promulgate
Identical provision. [§834(b)]
Identical provision.
Air Toxics
final regulations to control
[§1506(b)]
hazardous air pollutants from
motor vehicles and their fuels
by July 1, 2004. [§17104(b)]
Blending of
No comparable provision.
No comparable provision.
Retailers may blend batches
Compliant
of gasoline with and without
Reformulated
ethanol as long as both
Gasolines
batches are compliant with
the Clean Air Act. In a given
year, retailers may only blend
batches over two ten-day
periods in the summer
months. [§1514]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Consolidation
Eliminates the less stringent
Identical provision. [§834(c)]
Identical provision.
of RFG
requirements for volatility
[§1506(c)]
Requirements
applicable to reformulated
gasoline sold in VOC Control
Region 2 (northern states) by
applying the more stringent
standards of VOC Control
Region 1(southern states).
[§17104(c)]
Public Health
No comparable provision.
Amends §211(b) of the Clean Air Act
No comparable provision.
and Environ-
to require manufacturers of fuels and
mental Impacts
fuel additives to conduct tests of their
of Fuels and
health and environmental impacts
Additives
(currently, these tests are at EPA’s
discretion and do not include
environmental effects). Also requires
EPA, within 2 years, to conduct a
study of the health and environmental
effects of MTBE substitutes, including
ethanol-blended RFG. [§ 835]
Analyses of
A new §211(p) is added to the
Identical provision. [§ 836]
Identical provision. [§1507]
Fuel Changes
Clean Air Act. Within four
years of enactment, the
Administrator of the
Environmental Protection
Agency (EPA) must publish a
draft analysis of the effects of
the fuels provisions in the Act
on air pollutant emissions and
air quality. Within five years of
enactment, the Administrator is
required to publish a final
version of the analysis.
[§17105]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
RFG Opt-In
No comparable provision.
Allows Governors of 12 Northeastern
No comparable provision.
states to petition EPA to require RFG
use in attainment areas in their states.
The Administrator shall do so, unless
he determines there is insufficient
capacity to produce RFG, in which
case the commencement date of the
requirement shall be delayed. [§ 837]
Federal
No comparable provision.
At the request of a state, allows
No comparable provision.
Enforcement
federal enforcement of state controls
on fuels and fuel additives. [§ 838]
Renewable
Requires DOE to collect and
Similar provision. [§813]
Identical to the House
Fuels Surveys
publish monthly survey data on
provision. [§1508]
the production, blending,
importing, demand, and price of
renewable fuels, both on a
national and regional basis.
[§17106]
Not later than 12/1/2006, and
Similar provision beginning
Similar provision. [§1501(c)]
annually thereafter, requires the
12/1/2005. [§820(d)]
EPA Administrator to conduct a
survey to determine the market
shares of conventional gasoline
and RFG containing ethanol and
other renewable fuels in each
conventional and RFG area in
each state. [§17101(c)]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Study of
The EPA Administrator and the
Similar to the House version, except
Similar to the House version,
Harmonizing
Secretary of Energy are required
that the report must be submitted by
except that the report must be
Fuel System
to conduct a study of all federal,
June 1, 2006.
submitted by December 31,
Requirements
state, and local motor fuels
[§ 839]
2007. [§1510]
requirements. They are required
to analyze the effects of various
standards on consumer prices,
fuel availability, domestic
suppliers, air quality, and
vehicle emissions. Further, they
are required to study the
feasibility of developing
national or regional fuel
standards. A report must be
submitted to Congress by
December 31, 2006. [§17107]
Reducing the
A new provision is added to
No comparable provision.
A new provision is added to
Proliferation of
§211(c)(4) of the Clean Air Act.
§211(c)(4) of the Clean Air
Boutique Fuels
The EPA Administrator is
Act. The EPA Administrator
directed to give preference to
shall not approve a control or
the approval of air quality State
prohibition respecting the use
Implementation Plans that
of a fuel or fuel additive
require the use of "Federal
unless he finds that it will not
Clean Burning
cause fuel supply or
Gasoline"(defined as
distribution interruptions or
Reformulated Gasoline with a
have a significant adverse
Reid Vapor Pressure of 6.8 psi)
impact on fuel producibility
or "Low RVP" gasoline (with a
in the affected area or
Reid Vapor Pressure of 7.8 psi).
contiguous areas. Within 18
[§17107A]
months of enactment, the
Administrator shall submit a
report to Congress on the
effects of providing a
preference for RFG or either
of two low RVP gasolines.
[§1509]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Ethanol from
The Secretary of Energy is
Similar provision. [§820B]
Similar provision. [§1511]
Solid Waste
required to establish a loan
Loan
guarantee program for the
Guarantees
construction of facilities to
produce fuel ethanol and other
commercial byproducts from
municipal solid waste. The
section authorizes such sums as
may be necessary for the
program. [§17108]
MTBE and
Authorizes to be appropriated to
Amends Subtitle I of the Solid Waste
Authorizes $200 million for
Other
EPA from the Leaking
Disposal Act (SWDA) to authorize
each of FY2004-FY2008
Oxygenated
Underground Storage Tank
EPA and states to use funds
from the LUST Trust Fund
Fuel Cleanup
(LUST) Trust Fund $850
appropriated from the LUST Trust
for responding to LUST
million for actions deemed
Fund to remediate releases of MTBE
releases generally, and the
necessary to protect human
or other ether fuel additives that
same amount for responding
health, welfare, and the
present a threat to human health,
to releases of fuels containing
environment from underground
welfare, or the environment;
MTBE or other oxygenated
storage tank (UST) releases of
authorizes the use of $200 million
fuel additives (e.g., ethanol)
fuel containing fuel oxygenates.
from the LUST Trust fund for this
that present a threat to human
[§ 17201]
purpose; and specifies that releases
health, welfare, or the
need not be from USTs to be eligible
environment.
for funding. [§ 832]
[§1525 and §1531]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Underground
No similar provisions.
Amends Subtitle I of the Solid Waste
Makes more extensive
Storage Tank
Disposal Act (SWDA) to allow EPA
amendments to Subtitle I
Compliance
and states to use LUST funds to
UST and LUST programs
conduct inspections and enforce
than does the Senate version.
federal and state UST release
Adds new tank inspection
prevention and detection
and operator training
requirements; authorizes for these
requirements; prohibits fuel
purposes, $50 million for FY2003,
delivery to ineligible tanks;
and $30 million for each of FY2004-
expands UST requirements
FY2008. Directs EPA to establish a
for federal facilities; and
resource center for research on
requires EPA, with Indian
bioremediation of MTBE in
tribes, to develop and
groundwater and for providing
implement a strategy to
technical assistance to states; for these
address releases on Tribal
purposes, authorizes LUST Trust Fund
lands. Authorizes use of
appropriations of $500,000 for
LUST funds to help owners
FY2003 and $300,000 for each of
pay for cleanup in cases of
FY2004-FY2008. EPA may establish
financial hardship. Funds
a research program for soil
may also be used to conduct
remediation of MTBE; for this
inspections and enforce UST
purpose, authorizes Trust Fund
leak prevention and detection
appropriations of $100,000 for
requirements; authorizes for
FY2003 and $50,000 for each of
these purposes and for
FY2004-FY2008. [§ 832]
implementing delivery
prohibition provisions, $50
million in LUST funds for
each of FY2004-FY2008.
[§1522-§1533]

---

Provision
H.R. 6, as passed by House
H.R. 6, as passed by the Senate
Conference Report
Research and
No comparable provision.
No comparable provision.
Authorizes $4 million for the
Development
University of Mississippi and
the University of Oklahoma
for each of fiscal years 2004-
2008 for a resource center to
further develop
bioconversion technology
using low-cost biomass for
the production of ethanol.
[§1512(b)]
Authorizes $25 million in
each of FY 2004-2008 for
research, development, and
implementation of renewable
fuel production technologies
in RFG states with low rates
of ethanol production.
[§1512(c)]

---