The Associated Press August 26, 2011, 4:15PM ET

Irene bringing gasoline shortages, power outages

East Coast residents braced for power outages and rushed to top off their gas tanks as Hurricane Irene swept closer to the region Friday. Power plants, refineries and pipelines prepared to shut down and utility repair crews gathered equipment to fix downed power lines.

Gasoline stations along the East Coast began to run dry Friday. Utility officials and forecasters say millions of people are in danger of losing electric power, some for days. Analysts do not expect widespread or long-lasting gas shortages, though, and they and they don't expect prices for power and gas to rise.

Still, the threat of Irene's strong winds and heavy rains are buffeting the energy industry hours before the actual storm is expected to reach land.

An unusually large number of people may be affected by Irene. That's because it is forecast to stay just offshore--and thus retain much of its power--as it inches up the coast from North Carolina to New England. When a hurricane hits land, it quickly loses steam.

Irene could reach North Carolina's Outer Banks on Saturday with winds around 100 mph, then head up the coast. Forecasters say Irene is not strengthening, as they had initially feared, but it remains dangerous.

The entire Eastern Seaboard lies in the storm's projected path, with flooding and wind damage likely. North Carolina, Virginia, Maryland, New Jersey, New York, Connecticut and Rhode Island have declared emergencies. New York City issued evacuation orders to 270,000 people in low-lying areas

On Friday, drivers in Irene's path rushed to gas stations for a last-minute fill-up before the storm, analysts said. Gasoline demand jumped 20 to 40 percent in Mid-Atlantic states, the Oil Price Information Service, which tracks gasoline supplies and prices around the country.

Several gas stations in New Jersey and in other spots along the eastern seaboard have run out of gasoline, according to OPIS.

Overnight, retail prices were mostly unchanged in many cities that are expected to be hit this weekend. Rules against price gouging at gas stations took effect throughout Middle Atlantic states. Authorities will be on the lookout for stations that try to take advantage of panicked drivers.

Pump prices in Myrtle Beach, S.C. rose less than a penny to $3.35 per gallon. They held at $3.58 in Charlotte, N.C. and slipped a penny in Norfolk Va. to $3.46

Uncertainty about where Irene will go -- and what it could destroy -- makes it nearly impossible to predict how gasoline supplies and prices will be affected, says Gregg Laskoski, a senior petroleum analyst at GasBuddy.com.

OPIS says East Coast refineries will cut operating rates 10 percent to 25 percent in the next few days in preparation for the storm. They could slow further or shut as the storm moves through. That could tighten supplies enough to push prices higher, but not by much, Laskoski says.

That's because refineries in the Gulf Coast and the West should be able to keep supplies flowing. Refineries along the Louisiana Coast produce more than three times the gasoline and fuel of their East Coast counterparts, according to the Energy Information Administration. Plus, East Coast demand is going to fall as businesses close and people hunker down at home.

Laskoski says those factors will keep prices more stable than normal following hurricanes in the U.S. Gulf.

High winds are the biggest threat to utility wires and poles. Recent heavy rains in the region have made trees even more vulnerable to toppling over.

There isn't much a utility can do to prevent outages. But industry officials say they have learned from past hurricanes how to restore power as quickly as possible.

Progress Energy which serves customers in costal North Carolina, learned from the devastating Hurricane Hugo in 1989 how important it was to get workers in place early. That allows them to begin working to restore power as soon as possible after the storm has passed.

Progress says it is gathering 500 workers, along with equipment and supplies, and moving them to regions that are expected to be hardest hit. The company has secured hotel rooms for workers to stay in, caterers to feed them, and trailers to turn into command centers. PSE&G, which serves 2.2 million New Jersey customers, will have about 6,000 employees working to restore power once Irene moves through, including 840 linemen and 540 tree contractors.

Power plants, refineries and pipelines are built to withstand hurricane-force winds and beyond, so they are usually not damaged in storms. But they have to be secured, and they may need to be shut down.

Nuclear reactors sit on eight coastal sites along the Eastern seaboard in the projected path of Hurricane Irene. They are built to withstand winds much stronger than those expected from Irene. They are also equipped with backup generators protected from flooding to provide power to keep the reactor cool if outside power is lost. Still, some will likely be shut down as a precaution in advance of Irene's winds and heavy rains.

Typically they must be shut down between two and 24 hours before hurricane force winds are expected or if water levels of nearby water bodies rise beyond a certain level.

Refineries are sprawling complexes of concrete and steel that turn oil into gasoline, diesel and other kinds of fuels. While the main buildings are designed to withstand hurricane-force winds and earthquakes, some of their pipes, cooling towers and power lines are susceptible to wind damage.

Refinery operators must decide about 72 hours before a hurricane hits whether to go into what is called "cold shutdown." Furnaces are turned off and fluids are drained from the refining vessels and into storage tanks.

It takes several days for a refinery to start operating again following a shutdown. And many would need almost a month to get back to full operation.

Colonial Pipeline, which delivers gasoline, diesel fuel, home heating fuel and jet fuel from refineries in the U.S. Gulf to New York, says it's planning for a possible shut down.

"We're planning as if Irene is going to hit. If it does, we're ready to safely shut down the pipeline," says Colonial Pipeline spokesman Steve Baker. "Right now we're operating normally."

Pipelines generally run underground and are not affected by wind and rain. But power outages could cut off communications through the system making it difficult to monitor the flow of fuel through pipe.

Jonathan Fahey can be reached at http://twitter.com/JonathanFahey. Chris Kahn can be reached at http://twitter.com/ChrisKahnAP


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