Northeast Gasoline Supply Reserve

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About NGSR

In 2012, Superstorm Sandy made landfall in the northeastern United States and caused heavy damage to two refineries and left more than 40 terminals in New York Harbor closed due to water damage and loss of power. This left some New York gas stations without fuel for as long as 30 days. As part of the Obama Administration’s ongoing response to the storm, the Department of Energy established the Northeast Gasoline Supply Reserve (NGSR); the first federal, regional, refined petroleum product reserve containing gasoline

Creation of the emergency stock of gasoline was authorized by Energy Secretary Ernest Moniz on June 20, 2014. Secretary Moniz directed the Office of Petroleum Reserves to establish a one million barrel gasoline component of the Strategic Petroleum Reserve in the Northeast. The intent was to create a buffer large enough to allow commercial companies to compensate for the initial impacts of interruptions in supply, but not so large as to dissuade the companies from maintaining stock levels sufficient to respond to routine disruptions or to recognize that increasing prices are an indicator that more supply is needed. A one million barrel emergency reserve would give Northeast consumers supplemental supplies for a few days in the event of a hurricane or other disruption, until existing distribution infrastructure could return to full operation.

Immediately after the Secretary’s June 2014 directive, the Energy Department finalized solicitations to acquire storage service contracts in the Northeast, as well as one million barrels of gasoline stocks. Contracts were awarded in late summer 2014 and the gasoline was soon delivered. The regional reserve has 700,000 barrels of gasoline located in the New York Harbor area, 200,000 barrels positioned in the Boston area, and 100,000 in South Portland, Maine.

The Northeast region of the U.S. is particularly vulnerable to gasoline disruptions as a result of hurricanes and other natural events. Hurricane Sandy in 2012 caused widespread issues related to the availability of gasoline. In response to help build a more secure and resilient energy infrastructure, the Energy Department established the first federal regional refined petroleum product reserve containing gasoline.

To help strengthen regional fuel resiliency in the Northeast, the Northeast Gasoline Supply Reserve (NGSR) holds one million barrels of gasoline:

Background picture of NGSR

700,000 barrels located in the New York Harbor area;
200,000 barrels positioned in the Boston area; and
100,000 in South Portland, Maine.

 

Releasing Gasoline

Decisions to withdraw gasoline from the Reserve are made under the authorities of the Energy Policy and Conservation Act (EPCA).  The U.S. Department of Energy has developed an online bidding system – an anonymous auction program – for the sale of product from the NGSR. Prospective bidders and other interested parties are invited to try out the system and give us feedback.

You must register to use the system to practice or to participate in an actual emergency sale.
Registration assures that you will receive email alerts of sales or other pertinent news. You will also have the opportunity to establish a user ID and password to submit bids.
If you establish a user ID, you will receive a temporary password by email, which you must then change to one of your own choosing.

The online bidding system is available as a non-binding demonstration. You can use the system to become more familiar with the bidding process in a realistic environment.

The Department plans to run simulated one-day sales, open to all interested registrants. When you register on the next page, you will receive email alerts describing simulations and providing more specific directions.

To register or practice on the demonstration system, proceed to the Northeast Gasoline Supply Reserve Online Bidding System.

In order to be eligible to conduct business with the Federal Government and purchase distillate from the NGSR, all bidder's financial institutions must use the Fedwire Funds Service System.  Prior to setting up the Fedwire Funds Service, your institution must have a Master Account with the Federal Reserve Banks.

One Fedwire Funds Service is established, potential buyers may go to the Northeast Gasoline Supply Serve (NGSR) auction website and register.  Registration ensures that potential buyers receive email alerts of sales in the future.