Gasoline Storage Program Along The East Coast -- Strategic Gasoline Reserve

Updates

May 4, 2014: Argus Media is reporting the same concerns I had. My comment to Don:

The article mentions the same concerns we had -- gasoline gets old after awhile, need for electricity to pump the gasoline, and EVEN regional formulations.

You know, in the middle of an emergency, one has to admit it's crazy to worry about "regional formulations."

My hunch is the reserve will simply be a "pass-through" entity. The storage will be emptied on a regular basis if not used and will be refilled. It will be interesting how they price the cost of filling and emptying. If that's not included in the price, the government is going to lose money every time they fill and empty. Schumer has it ass-backwards: it was not the shortage of gasoline that was the problem; it was the electric grid.  

Original Post

I made a huge error earlier this morning in a posting. Fortunately Don caught it, and I brought the post down. I had misread the article. Truly embarrassing because the headline told the story.

My original post was a really, really good post -- except that it was entirely based on something that was not true, something that I misread. So I will try again.

The problem? I am having trouble coming to grips with the story. My memory must be deceiving me.

 The New York Times is reporting:

The federal government will build its first gasoline storage reserves in the New York Harbor area and in New England in response to the shortages suffered after Hurricane Sandy, the secretary of energy, Ernest J. Moniz, is to announce on Friday.

Together, the reserves will hold about a million barrels of gasoline and cost about $215 million. The fuel is intended to be held back in case another disaster cripples regional fuel supplies.

Energy Department officials envision the reserves as the first in a series that will be built in parts of the country vulnerable to extreme weather, believed to be caused by global warming.

“In addition to our mitigation and international efforts, the president’s Climate Action Plan calls on us to take measures today in order to better prepare for the effects of climate change we already see occurring here at home,” Mr. Moniz said in a statement.

Fuel shortages were one of the most widespread problems after Hurricane Sandy in October 2012. Two New York-area fuel refineries were shut down, and hundreds of gas stations lost power, leading to severe gasoline shortages.

I am having trouble coming to grips with the story because I didn't think it was a problem with an adequate supply of gasoline after the hurricanes. The gasoline was available, but with electricity "down," the pumps were not working and they couldn't get access to the gasoline.

So, now the government will be storing gasoline in various locations around the country. I assume they will provide for emergency power to make sure the gasoline in the storage tanks is accessible if the electric grid is compromised.

The bigger issue, I assume, is ensuring that the private service stations have electricity so that when they get the gasoline from the emergency gasoline reserves, they can actually pump it into individual vehicles.

It will be interesting to see how the increased demand for gasoline -- the gasoline that will be needed to fill these storage tanks -- will affect the price of gasoline in general. One would assume increased demand for gasoline would result in higher prices, all things being equal.

Bottom line: I think the bigger problem is the electric grid in this country.

Of course, the "climate change" rubbish is just that: rubbish. There has been no evidence of global warming for eighteen years. In addition, when there was global warming, which now seems to have dissipated, we were being told that the global temperature would rise about 1 - 3 degrees over a century. I have trouble accepting the fact that half-a-degree rise in global temperature in the 1990s can account for any weather we see today. I know the National Geographic had a cover with a Statue of Liberty waist deep in the Atlantic Ocean some time ago, but I assume that was photo-shopped.

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You Don't Own Me, Leslie Gore