States including Virginia have also issued emergency declarations allowing their own agencies to waive rules to ease fuel backlogs.
The moves came as the Biden administration made repeated assurances that it is trying to forestall fuel shortages, while warning that some may occur anyway.
“These states who are impacted, even with the turning on of the pipeline system, they still may feel a supply crunch as Colonial fully resumes,” Energy Secretary Jennifer Granholm said during a briefing with reporters. “But the American people can feel assured that this administration is working with the company to get it resumed as soon as possible.”
EPA’s action: The Energy Department agreed with the agency’s waiver, EPA Administrator Michael Regan wrote Tuesday, calling the cyberattack an “extreme and unusual” occurrence “that could not reasonably have been foreseen and is not attributable to a lack of prudent planning on the part of suppliers of the fuel to these areas.”
The EPA waiver applies in urban areas with ongoing air quality problems, including Philadelphia, Baltimore, D.C., northern Virginia, Richmond and Hampton Roads.
Fuel suppliers can temporarily sell their stockpiles of lower-grade gasoline through May 18. Any lower-grade fuel in the distribution system on that date can still be distributed and sold after the deadline.
Context: EPA typically issues such waivers after natural disasters have damaged refineries or fuel distribution infrastructure, but it can act whenever there is a major fuel supply disruption. For example, EPA issued two fuel waivers to Texas earlier this year in response to the deep freeze that plagued the state and caused fuel shortages that triggered massive blackouts.
And last year the agency delayed the switchover to summer-grade gasoline because of a supply glut of winter-grade gasoline caused by the onset of the coronavirus pandemic that dramatically lowered demand.
The White House said late Monday that it was actively prepping for possible disruptions, even as Colonial Pipeline resumed limited shipments to deliver fuel from North Carolina to a terminal in Maryland. The bulk of the pipeline remains shut.
The Jones Act: DOT announced a separate suite of actions later Tuesday, including the launch of a survey meant to find available ships that comply with the Jones Act. If not enough are available to assist with transporting fuel to areas in need, the Department of Homeland Security will consider waiving the Jones Act for ships carrying petroleum products “within the Gulf, and from the Gulf up the Eastern Seaboard,” DOT said.
DOT’s Federal Railroad Administration is also canvassing rail operators to “determine their capacity to help transport fuel from ports inland” and find out if there’s any way the federal government could help them increase capacity.
The agency has also expanded an earlier-issued waiver easing hours-of-service rules for truckers hauling fuel. The expansion covers shipments to an 18th state, West Virginia.
Biofuels: Separately, the ethanol industry on Tuesday called on EPA to expand sales of E15 fuel, gasoline that contains 15 percent ethanol as opposed to the standard 10 percent, to alleviate fuel shortages related to the Colonial Pipeline shutdown.
Ethanol producers have around 180,000 barrels per day of idle capacity, some of which “could be quickly activated or reoriented to help alleviate impending fuel shortages on the East Coast,” Renewable Fuels Association President and CEO Geoff Cooper wrote in a letter to Regan. “For many reasons, utilizing domestically produced low-carbon fuel to help offset the supply shortage is preferable to importing more petroleum products, as is currently being planned.”
EPA did not immediately return a request for comment on RFA’s letter.
