In response to Superstorm Sandy, DOE has announced the first federal regional gasoline reserve to create one million barrels of gasoline storage in the Northeast.
On May 2, 2014, the Department of Energy (DOE) announced establishment of the first regional refined petroleum product reserve creating one million barrels of gasoline storage in the Northeast. The action, elicited by major fuel supply disruptions in the aftermath of Superstorm Sandy in 2012, will establish two reserves near New York Harbor and in New England, each having a capacity of 500,000 barrels, to provide short-term relief in the event of significant supply disruptions. It also builds on the administration’s broader commitment to enhance energy infrastructure resilience and security. The new gasoline reserve will complement the Northeast Home Heating Oil Reserve (NEHHOR), a one million barrel diesel reserve, which met emergency requirements for the first time to address Superstorm Sandy disruptions.
2012 Superstorm Sandy Power Outages (EIA)
DOE highlighted the vulnerability of the Northeast region to weather-related events due to the location of major supply and distribution infrastructure along the coast. Superstorm Sandy resulted in significant damage of two refineries and shutdown of more than 40 terminals in New York Harbor due to water damage and power outage, leaving several New York gas stations without fuel for up to 30 days. As DOE’s existing Strategic Petroleum Reserve stores crude oil and not refined petroleum products, DOE noted that establishing a federal government-owned gasoline reserve at leased commercial East Coast storage terminals would mitigate the impacts of unexpected future supply interruptions. DOE expects to award contracts for commercial storage, service, and product acquisition to launch the reserve by late summer this year.
According to DOE, the Quadrennial Energy Review (QER), launched in January, will conduct regional fuel resiliency studies to assess specific weather-related vulnerabilities challenging regional energy supply infrastructure. Regional refined product reserves will be part of an overall system aimed to minimize potential disruption, due to inherent U.S. energy infrastructure interdependence. QER aims to facilitate a comprehensive and integrated energy strategy to address the changing energy landscape.
May 5, 2014 via Energy Solutions Forum.
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