USDA working to lower fuel prices

Published 12:00 am Tuesday, April 3, 2012

By Karissa Minn
SALISBURY — After a month when the state’s gasoline prices climbed 13 cents, according to AAA Carolinas, the U.S. Department of Agriculture (USDA) says it’s working to push them back down.
Tom Vilsack, U.S. Secretary of Agriculture, said Monday that he knows Americans are frustrated with the rising gasoline prices. He said there are several reasons for it, including oil speculation and international events.
In North Carolina, gas prices are expected to continue to climb and regular unleaded gas could reach the $4 per gallon mark this month, AAA Carolinas predicts.
Vilsack has been talking to media outlets across the state about the Obama administration’s “all-of-the-above” approach to energy policy, including renewable energy.
“This administration is now helping the biofuel industry to produce a record amount of biofuel,” Vilsack said in a Monday phone interview. “During this administration, we’ve doubled the amount of power generated from renewable sources.”
The U.S. Environmental Protection Agency (EPA) on Monday began allowing manufacturers to register as suppliers of E15, a gasoline blend with up to 15 percent ethanol.
The blend must still go through more federal testing and gain approval in individual states. Then, petroleum marketing companies will be given the choice to sell it at gas stations.
Vilsack said if the gasoline industry can be persuaded to shift to E15 instead of the 10 percent blend that’s common now, it could lower gas prices by 5 to 15 cents per gallon.
Farmers also can make an impact, he said, and not just by producing ethanol from grain or corn.
The U.S. Department of Agriculture (USDA) is helping to finance renewable energy projects on farms through its Renewable Energy for America Program.
Vilsack said the new program has helped about 276 businesses and farms in rural North Carolina become more energy efficient.
“This has helped to save nearly 300 million kilowatts of electricity, which is enough to power 26,000 homes for a full year,” Vilsack said.
He said the federal government is also taking steps to spur domestic energy production. For the first time in 13 years, he said, the U.S. is importing less than half — 45 percent — of its oil needs from other countries.
“We’ve quadrupled the number of oil wells that are currently operating,” Vilsack said. “We’ve issued hundreds of new permits with new safety standards. In this administration, we’ve authorized millions of new acres of land, both offshore and onshore, where we can do further exploration. We’re now the number one producer of natural gas globally.”
He said the Obama administration is not opposed to “fracking,” or hydraulic fracturing, to extract natural gas as long as the process is environmentally sound.
In a Monday press release, AAA Carolinas said 2012’s rise in oil prices is driven largely by global news, including geopolitical tension with Iran, oil speculation and signs of economic recovery both domestically and abroad.
Also a factor, it said, is the 8-cent increase in North Carolina’s fuel tax at the beginning of this year.
AAA Carolinas said refineries typically do their heaviest maintenance of the year in April as they switch over to summer-blend production, reducing supply, and as motorists begin driving more, increasing demand.
The average price for a gallon of unleaded self-serve gasoline in North Carolina on Monday was $3.89. A month ago today the state’s average price was $3.75.
“We expect prices to increase into May,” said David E. Parsons, president and CEO of AAA Carolinas, in the press release. “The good news is that in the past two years we saw a stabilization or reduction of gas prices once we get into the summer months. We hope that scenario repeats itself again this year.”
Contact reporter Karissa Minn at 704-797-4222.
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