US energy bill would protect MTBE makers from lawsuits
Date: 18-Nov-03
Country: USA
MTBE, or methyl tertiary butyl ether, is a suspected carcinogen that has contaminated underground water supplies in many cities in California and other states. It competes with corn-based ethanol, which has wide support among Midwestern lawmakers and the Bush administration.
The provision in the Republicans' draft bill would mainly protect Lyondell Chemical Co. (LYO.N: Quote, Profile, Research) , Valero Energy Corp. (VLO.N: Quote, Profile, Research) and privately held Huntsman Petrochemicals, the nation's biggest MTBE makers.
The MTBE provision is one of the most contentious in the legislation, which will be debated at a Senate-House conference committee meeting yesterday.
Senate Democrats oppose the liability shield and some have threatened to filibuster the energy bill if it includes the language.
Republican bill writers specified that MTBE makers could not be held liable in lawsuits filed after Sept. 5 if their product leaked from underground storage tanks owned by others.
MTBE should not be considered a defective product "if it does not violate a control or prohibition imposed by the administrator of the Environmental Protection Agency ... and the manufacturer is in compliance with all requests for information," the draft bill said.
The bill also said, "Nothing in this subsection shall be construed to affect the liability of any person for environmental remediation costs, drinking water contamination, negligence for spills or other reasonably foreseeable events."
The U.S. Conference of Mayors criticized the liability protection, saying it would force local communities to pay an estimated $29 billion in clean-up costs that should be borne by makers of the oil-based chemical.
Lobbyists had expected the effective date to be in October. However, Republican aides said the September date was chosen because it was the beginning of the energy bill-writing process.
The draft bill also proposed:
* Phasing out the use of MTBE by Dec. 31, 2014;
* Providing an annual total of $250 million in financial assistance to MTBE makers during the phaseout period, including grants to convert production plants so they can make renewable fuels or iso-octane;
* Ordering a study by the National Academy of Sciences by 2014 to review new scientific data about the use of MTBE in fuel and its environmental impacts;
* Spending several hundred million dollars from the Leaking Underground Storage Tank Trust to protect the environment from aging tanks.