Ultra Low Sulphur Diesel Cost: Is It More Expensive Than Regular Diesel

January 27, 2012

If you own or operate a diesel-powered vehicle you may be wondering whether ultra low sulphur diesel fuel (ULSD fuel)is more expensive than regular diesel. This clean diesel fuel was mandated by the Environmental Protection Agency in 2006, and by December 1, 2010 it will basically be the only type available on highways in the United States. ULSD is estimated to cost $0.05 to $0.08 more per gallon than regular diesel fuel.

Lower Emissions

The EPA mandated ultra low sulphur diesel fuel as part of a plan to reduce emissions. ULSD burns cleaner than regular diesel, releasing less particulate matter and sulfur dioxide. However, low sulfur fuel also has lower lubricity, which increases wear on fuel injection systems. The public health benefits of low sulphur fuel are manifest, but low sulphur content is one of the factors behind the higher price.

Higher Production and Distribution Costs

Ultra low sulphur diesel fuel must be refined from low sulphur crude oil. This is also known as sweet crude, whereas the more common sour crude has high sulphur content. Higher production and distribution costs lead to higher retail prices for ULSD. Furthermore, the demand for all types of diesel fuel grew faster than demand for gasoline between 2002 and 2007. This contributed to the per-gallon price of diesel fuel rising above the price of gasoline in many areas. With clean options such as ULSD or biodiesel entering the market, demand will continue to grow as passenger cars are offered with diesel engines.

Coming Soon to a Filling Station near You

Although ultra low sulphur diesel fuel is more expensive than regular diesel, its use is better for the environment and unavoidable in many industries due to federal regulation. Be aware of how regulatory changes to fuel composition will affect the performance of your vehicle's engine.

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