SEC. 2. TEMPORARY WAIVERS DURING SUPPLY EMER-
GENCIES. 
Section 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 
7545(c)(4)(C)) is amended by inserting ‘‘(i)’’ after ‘‘(C)’’ 
and by adding the following new clauses at the end there-
of: 
‘‘(ii) The Administrator may temporarily waive a con-
trol or prohibition respecting the use of a fuel or fuel addi-
tive required or regulated by the Administrator pursuant 
to subsection (c), (h), (i), (k), or (m) of this section or 
prescribed in an applicable implementation plan under sec-
tion 110 approved by the Administrator under clause (i) 
of this subparagraph if, after consultation with, and con-
currence by, the Secretary of Energy, the Administrator 
determines that— 
‘‘(I) extreme and unusual fuel or fuel additive 
supply circumstances exist in a State or region of 
the Nation which prevent the distribution of an ade-
quate supply of the fuel or fuel additive to con-
sumers; 
‘‘(II) such extreme and unusual fuel and fuel 
additive supply circumstances are the result of a 
natural disaster, an Act of God, a pipeline or refin-
ery equipment failure, or another event that could 
not reasonably have been foreseen or prevented and 
not the lack of prudent planning on the part of the
suppliers of the fuel or fuel additive to such State 
or region; and 
‘‘(III) it is in the public interest to grant the 
waiver (for example, when a waiver is necessary to 
meet projected temporary shortfalls in the supply of 
the fuel or fuel additive in a State or region of the 
Nation which cannot otherwise be compensated for). 
‘‘(iii) If the Administrator makes the determinations 
required under clause (ii), such a temporary extreme and 
unusual fuel and fuel additive supply circumstances waiver 
shall be permitted only if— 
‘‘(I) the waiver applies to the smallest geo-
graphic area necessary to address the extreme and 
unusual fuel and fuel additive supply circumstances; 
‘‘(II) the waiver is effective for a period of 20 
calendar days or, if the Administrator determines 
that a shorter waiver period is adequate, for the 
shortest practicable time period necessary to permit 
the correction of the extreme and unusual fuel and 
fuel additive supply circumstances and to mitigate 
impact on air quality; 
‘‘(III) the waiver permits a transitional period, 
the exact duration of which shall be determined by 
the Administrator, after the termination of the tem-
porary waiver to permit wholesalers and retailers to 
blend down their wholesale and retail inventory; 
‘‘(IV) the waiver applies to all persons in the 
motor fuel distribution system; and 
‘‘(V) the Administrator has given public notice 
to all parties in the motor fuel distribution system, 
local and State regulators, public interest groups, 
and consumers in the State or region to be covered 
by the waiver. 
The term ‘motor fuel distribution system’ as used in this 
clause shall be defined by the Administrator through rule-
making. 
‘‘(iv) Within 180 days of the date of the enactment 
of the Boutique Fuels Reduction Act of 2004, the Admin-
istrator shall promulgate regulations to implement clauses 
(ii) and (iii). 
‘‘(v) Nothing in this Act shall— 
‘‘(I) limit or otherwise affect the application of 
any other waiver authority of the Administrator pur-
suant to this section or pursuant to a regulation 
promulgated pursuant to this section; and 
‘‘(II) subject any State or person to an enforce-
ment action, penalties, or liability solely arising from 
actions taken pursuant to the issuance of a waiver 
under this subparagraph.’’.
SEC. 3. CAP ON NUMBER OF BOUTIQUE FUELS. 
Section 211(c)(4)(C) of the Clean Air Act (42 U.S.C. 
7545(c)(4)), as amended by section 2, is further amended 
by adding at the end the following: 
‘‘(vi)(I) The Administrator shall have no authority, 
when considering a State implementation plan or a State 
implementation plan revision under this subparagraph, to 
approve any fuel if the effect of such approval would be 
to increase the total number of fuels approved and fully 
implemented as of September 1, 2004 in all State imple-
mentation plans. 
‘‘(II) Except for a fuel with a summertime Reid 
Vapor Pressure of 7.0 pounds per square inch, the Admin-
istrator shall have no authority, when considering any par-
ticular State’s implementation plan or a revision to that 
State’s implementation plan under this subparagraph, to 
approve any fuel unless that fuel was, as of the date of 
such consideration, approved and fully implemented in at 
least 1 State implementation plan in the applicable Petro-
leum Administration for Defense District. The preceding 
sentence shall not limit the Administrator’s authority to 
approve any new fuel in any such plan or plan revision 
if such new fuel replaces an existing fuel without increas-
ing the total number of fuels approved and fully imple-
mented as of September 1, 2004 in all State implementa-
tion plans.
‘‘(III) Nothing in this clause shall be construed to 
prohibit a State from requiring the use of any fuel additive 
registered in accordance with subsection (b), including any 
fuel additive registered in accordance with subsection (b) 
after the enactment of this subclause.’’. 
SEC. 4. STUDY AND REPORT TO CONGRESS ON BOUTIQUE 
FUELS. 
(a) JOINT STUDY.—The Administrator of the Envi-
ronmental Protection Agency and the Secretary of Energy 
shall undertake a study of the effects on air quality, on 
the number of fuel blends, on fuel availability, on fuel 
fungibility, and on fuel costs of the State plan provisions 
adopted pursuant to section 211(c)(4)(C) of the Clean Air 
Act (42 U.S.C. 7545(c)(4)(C)). The primary focus of such 
study shall be to determine how to develop a Federal fuels 
system that maximizes motor fuel fungibility and supply, 
preserves air quality standards, and reduces motor fuel 
price volatility that results from the proliferation of bou-
tique fuels, and to recommend to the Congress such legis-
lative changes as are necessary to implement such a sys-
tem. In furtherance of such a study, the Administrator 
and the Secretary shall, as appropriate, review studies and 
other actions of other Federal agencies concerning bou-
tique fuels with a view toward avoiding duplication of ef-
fort and the need to expedite such study.
(b) STUDY AREAS OF RESPONSIBILITY.—In carrying 
out the study required by this section, the Administrator 
shall coordinate obtaining comments from affected parties 
interested in the air quality impact assessment portion of 
the study, and the Secretary shall coordinate obtaining 
comments from affected parties interested in the fuel 
availability, number of fuel blends, fuel fungibility, and 
fuel costs portion of the study. 
(c) REPORT TO CONGRESS.—The Administrator and 
the Secretary jointly shall submit the results of the study 
required by this section in a report to the Congress not 
later than 12 months after the date of the enactment of 
this Act, together with any recommended regulatory and 
legislative changes. Such report shall be submitted to the 
Committee on Energy and Commerce of the House of 
Representatives and the Committee on Environment and 
Public Works of the Senate. 
SEC. 5. DEFINITIONS. 
In this Act: 
(1) The term ‘‘Administrator’’ means the Ad-
ministrator of the Environmental Protection Agency. 
(2) The term ‘‘Secretary’’ means the Secretary 
of Energy. 
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