Before the Department of Energy Economic Regulatory Administration: Amendments to the Entitlements Program to Reduce the Level of Benefits Received under the Small Refiner Bias

by Barry Bosworth on February 5, 1979
by Barry Bosworth, Sandra Sherman, Thomas D. Hopkins and Vartkes L. Broussalian

The Department of Energy (DOE) is proposing  to amend the present small refiner bias program, which gives
entitle~ents to small refiners in addition to those issued to all refiners under the entitlements program. The entitlements program was introduced in November 1974 to equalize the acquisition cost of crude among refiners regardless of their individual access to domestic controlled crude. This is done by issuing monthly to each refiner a number of entitlements equal to its crude runs for that month multiplied by the ratio of total allocable domestic controlled crude oil to national refinery crude runs. A refiner who receives fewer entitlements than his supply of controlled crude is required to make up the difference by purchasing entitlements. A refiner who receives more entitlements is required to sell the excess entitlements. The price of an entitlement is set by DOE and reflects the difference between the controlled and the free market price of crude.

 Download the Complete PDF   Share Share    Print Print    Email Email

Previous post:

Next post: