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Concerned about the fact that the actual quantum of loss entailed by oil marketing companies (OMCs) on evaporation wastage (of petrol and diesel) is actually not known, the Government is looking at possibilities of levying a cess on the companies in order to curb the wastage.

In simpler terms, with the Government not aware of the actual loss entailed owing to evaporation wastage, it is the common man who is not getting the money’s worth on the petrol or diesel which he of she is purchasing. Evaporation wastage occurs when during getting one’s automobile filled at fuel stations, precious petrol or diesel evaporates through the nozzle while on its way to the fuel tank.

OMCs say that as petroleum products are highly volatile, they tend to evaporate during storage and handling. They further inform that the maximum allowable limit norms which are underlined under the marketing discipline guidelines (MDGs) meant for OMCs to curb evaporation losses, are followed by them.

At the same time OMCs admit that there are no actual figures available in quantitative terms to ascertain quantum of such losses. As per these norms, the maximum allowable limit for evaporation losses in case of petrol has been prescribed in the MDGs as under 0.75 per cent on the quantity sold up to an annual average of 600 kilolitres (kl). While it is 0.60 per cent on the additional quantity beyond an annual average of 600 kl.

In the case of diesel, the maximum allowable limit for handling losses is 0.25 per cent on quantity sold up to an annual average of 600 kl. It is 0.20 per cent on additional quantity beyond an annual average of 600 kl.

In other words, the common man is daily losing out on one’s money’s worth in terms of evaporation on up to 600 kl of petrol or diesel. Though exact loss is not ascertained, considering the huge number of vehicles which get refilled across thousands of fuel stations across the country, it can be enormous.

It is under such a scenario that the Petroleum Ministry is now thinking of levying a cess on OMCs in order to bring in an enhanced awareness in the industry as well as the common man regarding the issue. Official sources said that though as of now there is no such provision, levying of a cess on OMCs to prevent evaporation losses needs to be seriously thought of.

OMCs on their part say that awareness on the issue is already there, as in order to ensure the safety of the inflammable liquids (petrol and diesel) stored in underground tanks at the retail outlets, safety vents are provided to ensure regular venting or release of the gas formed due to evaporation at a higher plane (six metres above ground).

“To control such evaporation of petrol, PV valves have been installed on petrol vent pipes at various outlets across the country. These valves restrict continuous venting of vapours from the vent pipes and permit venting intermittently only when the desired pressure is built up inside the tank. The cost of the PV valve is around INR 2,500 each (for each outlet),” a senior Indian Oil Corporation (IOC) official said.

According to industry sources, if during the inspection of their outlets, it is found that the loss of petrol or diesel at a retail outlet (of the OMCs) is more than the prescribed limits, then the reasons for such a loss are sought from the dealers. Based on the explanation given, appropriate action is taken on the retail outlet, they added.

Till date though, there has been no report of any punitive action having been taken against any retail outlet for violating the fixed evaporation norms. IOC is the largest retailer of petrol and diesel in the country followed by Bharat Petroleum Corporation Ltd (BPCL) and Hindustan Petroleum Corporation Ltd (HPCL).

IOC has 24,000 outlets across the country and if it is spending INR 2,500 each on installing PV valves in these outlets to prevent evaporation wastage, then the total cost comes to INR 6 crore. While norms are in place and the Government is also now planning to focus on the matter, experts say that compared to greater awareness on the matter globally, India does lag behind. European Union (EU) has already imposed variety of measures to reduce evaporation wastage. The petrol stations across EU currently used two phases of emission controllers to reduce the wastage.

Under the first phase, the main storage tanks of the pumps use floating roof linings to prevent vapours from escaping. While in the second phase, filling pipes are already installed with PV valves. Be it storing the fuel in the storage tanks at the stations or the filling nozzles used for filling vehicles, across EU, all petrol pumps are taking preventive measures to ensure that less fuel evaporates and goes waste.

Source-On Request