Christie Rations Gas Purchases to Cool New Jersey Tempers

Nov. 2 (Bloomberg) – Bloomberg’s Alix Steel reports on the logistics behind the problems in getting gasoline in the New York area where lines continue to build in the wake of superstorm Sandy. She speaks on Bloomberg Television’s “Market Makers.”

Governor Chris Christie ordered rationing of gasoline sales in 12 New Jersey counties to ease the misery of motorists waiting in miles-long lines for gasoline after Hurricane Sandy devastated the region.

The last numeral of a passenger vehicle’s license plate shows when it can get gas, according to a statement yesterday from Christie’s office. Those with plates ending in odd numbers can be fueled on odd-numbered days, starting at noon today.

“This system will ease the strain on those gas stations still operating, while we work to bring more online for the public to access fuel,” Christie said in the statement. The governor and Attorney General Jeff Chiesa pledged to “vigorously enforce the order.”

Tempers in New Jersey and New York have flared over days of power outages and difficulties buying gasoline for vehicles and portable electric generators. Utilities are under pressure from state officials and residents to restore service faster. More than 1 million customers in New Jersey remained without power yesterday, four days after Sandy battered the state.

The rationing affects Bergen, Essex, Hudson, Hunterdon, Middlesex, Morris, Monmouth, Passaic, Somerset, Sussex, Union, and Warren counties, according to the governor’s order. The restrictions extend until Christie lifts his declaration of a state of emergency.

Tapping Reserve

President Barack Obama took steps yesterday to increase fuel supplies to the region. He partially waived the Jones Act, which requires ships running between American ports to use U.S.- flagged vessels, to boost deliveries from Gulf Coast refineries.

New Jersey and New York also can expect delivery of 2 million gallons (7.6 million liters) of ultra-low-sulfur diesel from the Northeast Home Heating Oil Reserve to power emergency- response equipment. The fuel, from a depot in Connecticut, will be shipped as early as today, according to a statement from the U.S. Energy Department.

Christie also suspended restrictions on out-of-state fuel purchases, and said the state and the Federal Emergency Management Agency will deliver generators to filling stations shut by power outages. New York Governor Andrew Cuomo, 54, waived taxes and regulations to accommodate more fuel tankers and process their supplies more quickly.

Increased Stress

“People can’t get gas and it’s increased the stress level all throughout the region,” Cuomo, a Democrat, said yesterday at a press briefing. “There should be a real change in the condition and people should see it quickly.”

David Bednarz, a spokesman for Connecticut Governor Dannel Malloy, a Democrat, and Josh Vlasto, a Cuomo spokesman, didn’t immediately respond to e-mails sent after normal business hours requesting comment on whether rationing would be imposed in their states.

Some local officials had implemented systems earlier to limit fuel purchases by consumers.

Scott Vanderhoef, the executive of suburban Rockland County, about 40 miles north of Manhattan, issued an order yesterday limiting drivers there to no more than 10 gallons of gas or diesel fuel each day per vehicle. Yonkers Mayor Mike Spano issued a similar order for New York’s fourth-largest city on Nov. 1.

About 1.3 million customers in New York, or 14 percent of those in the state, were without power as of early yesterday, the Energy Department said. About 1.4 million customers in New Jersey, more than a third of homes and businesses, remained in the dark. The state was setting up temporary housing for 8,000 out-of-state utility workers, Christie told reporters in Brick, New Jersey, yesterday.

Few Open

Only 25 percent of gasoline stations are operating north of Interstate 195, which runs from Mercer to Monmouth counties through the center of the state, Christie said.

“I’m concerned and frustrated too,” Christie said. “In the next 24 to 48 hours I think we’re going to start to see things getting better.”

Hess Corp. (HES) and Gulf Oil LP have agreed to begin delivering more gasoline to New Jersey retailers, Christie said. He said that his administration issued subpoenas to 65 businesses, including those that sell fuel and generators, after receiving more than 500 consumer complaints about price gouging.

Sandy’s destruction has left 22 New Jerseyans dead. At least three were related to the use of generators, said Mary Goepfert, spokeswoman for the Emergency Management Office.

Speeding Repairs

Christie, a first-term Republican, said 12 other governors agreed this week to send workers to his state to help restore power. He said he also told utility chief executive officers Nov. 1 that they need to speed repairs.

“I made it clear to them that whatever playbooks they had were to be thrown out because we’ve never faced anything like this before,” Christie, 50, said in Moonachie Nov. 1. The Bergen County town near Teterboro Airport had to be evacuated after a tidal surge from the Hackensack River flooded the area.

Sandy’s winds and floods blacked out about two-thirds of New Jersey and crippled the region’s transit system. It also flooded fuel terminals, curbed deliveries and left many filling stations in the dark and unable to run pumps.

Cuomo said he expects most people in his state to have power back by late tomorrow.

Gasoline supplies that have dwindled should be replenished after the U.S. Coast Guard reopened the Port of New York, Cuomo said.

Two million gallons of gasoline arrived in Newburgh, New York, late Nov. 1, Cuomo said.

Opening Lanes

The fuel shortage resulted from ports being shut because officials feared shipping containers blown into the water by Sandy would damage passing vessels, Cuomo said. Some sea lanes were reopened in New York’s harbor Nov. 1. Most of the terminals that were knocked out, including the one in Port Jefferson on Long Island, were back online with generators.

“We understand why there was a shortage, and the harbor is now open,” Cuomo said.

Ships that travel between U.S. ports under the 1920 Jones Act are more expensive because they have to be built, owned and crewed in the country, said Urs Dur, a Clarkson Capital Markets analyst in New York. Allowing any ship to carry fuel between American ports will temporarily help relieve a shortage of qualified vessels.

The Coast Guard is looking for other ways to speed up the flow of gasoline into the region, including allowing barges to directly pump fuel into trucks rather than first offloading into holding tanks, Rear Admiral Daniel Abel said at Cuomo’s press briefing.

Rising Supplies

“We’re turning the tide,” Abel said. “There’s no question the supply of fuel is going to increase in New York harbor.”

Coney Island Avenue, a main artery in Brooklyn, was overwhelmed yesterday with cars seeking gasoline. The line for a Hess station stretched almost a mile from Church Avenue to 18th Avenue. There was also a line of about 200 people waiting with gas cans, expecting a fresh delivery, since the station’s pumps had run dry.

Jean Jean-Laurent, 56, of Queens, said he never saw anything like this in his 27 years as a car-service driver. He said he waited two hours Nov. 1 and was running low. “I was thinking today would be better, but it isn’t,” he said.

Requiring Generators

The shortage led New Jersey Assemblywoman Amy Handlin, a Republican from Middletown, to propose legislation that would require all filling stations to be equipped with generators to keep pumps running during power outages.

Among the state’s 22 Sandy-related deaths, two teenage sisters died from carbon-monoxide poisoning caused by the improper use of a generator in Newark, New Jersey’s largest city. Another probable generator-related death occurred in Middlesex County, Goepfert said.

Jersey Central Power & Light had the biggest number of New Jersey customers, 710,000, without electricity yesterday. Its parent, FirstEnergy Corp. (FE), made a $100,000 donation to the Jersey Coast chapter of the American Red Cross, according to a statement from the company.

The release of diesel from the heating-oil depot in Groton, Connecticut, will be the first since the 42 million-gallon system was set up in 2000, the Energy Department said. A second depot is located in Revere, Massachusetts, near Boston.

More Deliveries

New Jersey also was preparing for delivery of more than 500,000 gallons of diesel from the Federal Emergency Management Agency, Goepfert said yesterday. That supply will be used for hospital generators and emergency equipment on the ground.

Jill Trotta, 47, a home health-care worker from Lakehurst, New Jersey, said she went to three filling stations yesterday that were either out of gas or power before she found one with six pumps and a 10-minute line. People are getting edgier as the situation dragged into its fourth day, Trotta said. She said she saw people pushing and shoving in the line earlier, after a motorist ran out of gas while waiting.

“We’ve heard there are gas shortages so people are just trying to get whatever they can from somewhere,” she said as she waited in her gray Dodge Durango with several $20 bills crumpled up in her hand. “People are starting to go nuts. They’re going nuts and they’re afraid there won’t be any gas.”

To contact the reporters on this story: Elise Young in Trenton at eyoung30@bloomberg.net; Freeman Klopott in Albany at fklopott@bloomberg.net

To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net

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