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Has the EPA Made These Companies Rich?

By Tyler Crowe and Aimee Duffy - Apr 9, 2013 at 6:00AM

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The new gasoline regulations could make oil refiners lose, but there are winners too.

With the recent EPA proposal to tighten gasoline standards, several oil companies are crying foul. The American Petroleum Institute estimates that complying with these new regulations could cost the entire industry $10 billion upfront with an additional $2.4 billion each year to comply. This isn't all bad news, though.

Fool.com contributor Tyler Crowe takes a look at this proposed regulation, and he sees some opportunities that could arise from this new standard. As gasoline becomes cleaner, it will also improve engine quality and help to increase the miles per gallon rates on gasoline vehicles, so it could take some pressure off of automotive manufacturers when meeting new MPG standards. Also, the anticipated increase in a gallon of gas resulting from this regulation could also play well into the hands of Tesla Motors (TSLA 5.14%) and Westport Innovations (WPRT 6.96%), whose alternative transportation fuel options become more attractive as gasoline becomes more expensive.

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Stocks Mentioned

Ford Motor Company Stock Quote
Ford Motor Company
F
$13.53 (3.68%) $0.48
Tesla, Inc. Stock Quote
Tesla, Inc.
TSLA
$761.61 (5.14%) $37.24
Valero Energy Corporation Stock Quote
Valero Energy Corporation
VLO
$128.06 (0.22%) $0.28
Westport Fuel Systems Inc. Stock Quote
Westport Fuel Systems Inc.
WPRT
$1.23 (6.96%) $0.08

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

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