If there’s any doubt that the summer driving season is upon us — despite the feeling that it snowed only two weeks ago — just look at the price at the pump.
With an average price already at $3.67 per gallon nationally, and at $3.96 here in New York City, it’s a real economic issue as well.
While most people know gas prices climb in summer, most believe it is a supply/demand issue, because we use more gas for car-filled vacations or beach staycations.
But the real culprit behind higher prices is the fact that summer gasoline is actually a different blend and more expensive to produce than winter gasoline. Summer gas is supposed to burn cleaner and be better for the environment, the EPA says.
But here’s the rub: Each year, typically in March, nearly 25 percent of the refineries have to shut down for one to four weeks to make the switchover.
So let’s get out the back of the envelope and figure this out.
Having 25 percent of the refineries shut down for an average of 2.5 weeks equals a nearly 10 percent cut in gas supply for that time period.
So let’s say that summer gas burns cleaner and is better for the environment. Which Washington genius would want to halt production of 25 percent of our nation’s refineries for upward of half a month to go back to a “dirtier” gasoline in the fall? It makes no sense. Why not leave the cleaner blend all year?
In 2013, the US consumed 134.51 billion gallons of gas. Saving a minimum of 10 cents per gallon by not switching and keeping the “cleaner” gasoline would put $13.45 billion directly into middle-class consumers’ pockets, all while allowing all to breathe easier.
The biggest savings could come from building a few newer, more efficient major refineries, since the US has not built one since 1977.
Not only would that create thousands of well-paying jobs, it also would dramatically reduce the cost of gas.
Because there are 42 gallons in a barrel of gas, by adding 15 percent more refinery capacity, we could probably reduce our fuel costs by over 25 percent just because of the efficiencies of new refining technologies.
That reduction in gas prices would be 91 cents per gallon. Add to that the 10 cents saved by stopping the inefficient switchovers and, voilà, we are saving American consumers a $1.01 per gallon — or $135.85 billion per year.
Now that’s an energy policy.