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South Dakota considers more leeway on gasoline volatility in autumn months

PIERRE -- An official for the Magellan pipeline company, which has distribution terminals at Watertown and Sioux Falls, said Tuesday gasoline supply disruptions would be less likely in South Dakota under a change in volatility standards being considered by the state Department of Public Safety.

Volatility measures a fuel's ability to vaporize or change from a liquid to a vapor. Lower-volatility gasoline is better in hotter months and higher-volatility gasoline in colder months.

The proposed change would keep South Dakota's current volatility standards in place but also would allow the option in the fall months of using the volatility standards for North Dakota, Minnesota and Iowa.

That would give more flexibility for fuel deliveries to retailers and decrease distances that fuel must be trucked for deliveries.

"It's an effort to simplify and harmonize volatility in South Dakota with the other states," said Bruce Heine, director of government and media affairs for Magellan Mainstream Partners.

Last fall, then-Gov. Mike Rounds issued an executive order declaring a state of emergency so that fuel haulers could operate outside normal work hours in delivering gasoline, diesel and propane.

A public hearing was held Tuesday on the rule proposal. The change was supported by Dawna Leitzke, executive director for the South Dakota Petroleum and Propane Marketers Association, and by Heine.

No one spoke against the change. The state department will take written comments through July 29.

"We do sometimes have supply issues, especially in the fall," Leitzke said.

The volatility standards are based on daily weather temperatures, with volatility ratings changing month to month. South Dakota standards are 15.0 in December through March; 13.5 in April; 9.0 in May through Sept. 15; 10.0 for Sept. 16-30; 11.5 for October; and 13.5 for November.

The Iowa, Minnesota and North Dakota standards follow the same pattern except for the fall months. Then they are 11.5 for Sept. 16-30; 13.5 for October; and 15.0 for November.

Heine said one of the challenges for the pipeline in the fall months is having sufficient fuel available but not being able to market it yet in South Dakota.

He said Magellan has considered seeking a change in the industry standards for South Dakota but learned that such an attempt would trigger possible changes nationwide. The simpler route was to seek the change in South Dakota's rules.