In 1997, the California state legislature directed the California Energy Commission (CEC) to conduct a comprehensive study to evaluate the cost and supply of alternatives to MTBE in California’s reformulated gasoline (CaRFG2). The CEC commissioned MathPro Inc. to conduct the Refinery Modeling portion of the legislatively-mandated project.

The Refinery Modeling activity comprised three tasks:

• Task 1: Specify the policy scenarios to be analyzed and the methodology to be used in the Refinery Modeling activity
• Task 2: Calibrate the refinery model used in this activity, to conform to aggregate operations of the California refining sector in the 1997 Summer season
• Task 3: Analyze the specified scenarios using the calibrated refinery model

The Refinery Modeling activity produced widely-cited estimates of the economic effects on the California refining sector (e.g., incremental operating costs, new capital investments, etc.) of the proposed ban on MTBE use in all gasoline consumed in California. We estimated these economic effects by formal modeling of the California refining sector, using ARMS.

Results of the Refinery Modeling activity were approved and published by CEC.