Senators push Obama to propose clean gasoline rules

U.S. President Barack Obama delivers remarks at the White House in Washington November 28, 2012. Obama said on Wednesday he hopes he and Congress can reach agreement to avoid the looming ''fiscal cliff'' and shrink the budget deficit before Christmas, and urged supporters to press lawmakers to agree to a deal.

WASHINGTON (Reuters) - A group of Democratic senators on Thursday will urge the Obama administration to propose rules to cut smog-forming emissions from gasoline, regulations opposed by many Republicans.

The lawmakers, led by Senator Kirsten Gillibrand from New York, want the Environmental Protection Agency to propose rules that would slash the sulfur content in gasoline this year and to finalize them next year.

"Tier 3 will substantially reduce harmful pollutants that are responsible for health-related ailments such as heart attacks, premature death, asthma attacks and other chronic lung diseases," Gillibrand, a member of the Senate Environment and Public Works Committee, said in a letter obtained by Reuters that will be sent to President Barack Obama later on Thursday.

The rules, which had been expected to be proposed early in 2012, would require the sulfur content of gasoline to be cut to 10 parts per million, down from the current 30 ppm standard. Republican lawmakers have opposed the rules saying they would add costs to refiners and put jobs at risk.

The American Petroleum Institute, the main energy industry lobbying group, has said the rules could increase operating costs for refiners by up to 9 cents a gallon.

Ed Whitfield, a Republican from Kentucky in the House of Representatives, introduced a bill this year to stop the EPA from issuing the rules.

The EPA, however, has testified before Congress the price of cleaner gasoline would be closer to a penny a gallon, and even those costs would be greatly surpassed by savings in healthcare bills from reductions in lung-harming smog.

The senators quoted in the letter a study released in June by Navigant Consulting that said the rules could reduce health care costs by $5 billion or $6 billion a year by 2020 and double that by 2030.

Stephen Brown a vice president for government affairs at oil refiner Tesoro Corp, was blunt about his company's opinion about the impact of clean air rules on the economy.

"If more EPA regulations created jobs in America, then this administration would be looking at zero percent unemployment instead of the roughly 8 percent level we currently struggle with."

The senators said in the letter the rules would create over 30,000 new jobs over three years for installation and operation of equipment at the nation's oil refineries.

The letter signed by 13 senators include Dick Durbin, a close Obama ally from Illinois, Joe Lieberman, a Connecticut independent who caucuses with Democrats, and Oregon's Jeff Merkley.

A health advocate hoped the pressure would push the clean gasoline rules forward.

"This letter should send a strong signal to EPA and the White House that this should be a high priority, not something stuck in the bowels of the bureaucracy," said Frank O'Donnell, president of Clean Air Watch.

Before the election early this month, the Obama administration delayed several rules on emissions and oil and natural gas operations.

Now, the administration will likely roll out rules, many of which have been required by court orders, analysts say.

(Additional reporting by Erwin Seba in Houston; Editing by Lisa Shumaker and M.D. Golan)