Updates to disaggregating the refined oil sector in EPPA: EPPA6-ROIL

This note describes how to disaggregate the standard version of EPPA’s refined oil (ROIL) commodity into specific refined petroleum products. EPPA’s treatment of all refined products as a single commodity implies that all refined fuels are fungible, that the ease of international trade in each fuel is equal, and that all refined fuels face the same drivers of demand. This treatment precludes examination of competition between specific refined fuels (e.g., gasoline cars vs. diesel cars), modeling the impacts of low-sulfur fuel requirements (which would prohibit usage of residual fuel oils in maritime shipping, for example), or the examination of technologies that could compete with oil refining in specific fuels (e.g., gas-to-liquids (GTL), coal-to-liquids (CTL), or even a rigorous treatment of biofuel production. The methodology described here disaggregates the refined oil product imported from Global Trade Analysis Project (GTAP) by calculating the volume and value flow shares of six refined fuel categories. Data from the International Energy Agency (IEA), the U.S. Energy Information Administration (EIA), and the International Council on Clean Transportation (ICCT) are utilized to calculate these shares.