Documents Show Political Appointees Interfered With Cal. Energy Commission Study Of Hot Fuel Ripoff To Protect Oil Companies
Consumer Group Says Government Staff’s Consumer-Oriented Findings Were Altered by Commissioners With Ties to Oil Industry
Santa Monica, CA — Public documents retrieved by Consumer Watchdog
reveal that, after private meetings with oil industry representatives,
some of the California Energy Commission’s politically appointed Board
Members changed staff conclusions in a study of "hot fuel," in a way
that protected the interest of oil companies. In 2007, the California
Legislature asked the CEC for a “cost-benefit” report on the issue of
hot fuel – in which motorists get less energy per gallon of gas when
fuel temperature is above 60 degrees Fahrenheit – and if consumers
would benefit from gas pumps or other mechanisms that automatically
compensate for the temperature of the gas.
Newly found e-mails reveal a previously undisclosed private meeting
with an oil industry economist and later exchanges with staff ordering
changes to the study. In a November 26, 2008 e-mail, Commissioner
James Boyd wrote of the staff’s conclusions that automatic temperature
compensation (ATC) was desirable and legal:
"Bad news, the Executive Summary is totally slanted to one
conclusion. The last bullet question on Page 3 and the response thereto
on Page 4 HAVE GOT TO GO. You cannot speak for the consuming public in
a way that leaves no other conclusion than go with ATC….”
In addition to the revelations in the newly released documents,
Consumer Watchdog points out that Commissioner James Boyd’s wife is a
longtime lobbyist for the oil industry’s chief lobbying group, the
Western States Petroleum Association. Last month, Consumer Watchdog
called on Commissioner Boyd to recuse himself from the hot fuel study
because of this irresolvable conflict.
Click here to see the letter to Commissioner Boyd.
"Governor Schwarzenegger cannot let political appointees who are
married to oil industry executives reverse the findings of government
staff with expertise on these issues," said Judy Dugan of Consumer
Watchdog. "The hot fuel ripoff costs California drivers up to several
cents a gallon in the heat of the summer. Consumers deserve fairness at
the pump."
In a letter sent to the Energy Commission Tuesday evening, the
nonprofit, nonpartisan Consumer Watchdog asked the Commission to delay
a vote on the compromised study until after the public had an
opportunity to review over 350 pages of public records received by
Consumer Watchdog on Monday night. The letter also demands more
information about the original, uncompromised staff recommendations.
In the letter, Consumer Watchdog wrote:
The newly released documents, obtained under our Public Records Act
request, show that changes essentially reversing the conclusions of the
CEC professional staff and steeply favoring the oil industry, were
requested by Commissioner James Boyd and to a lesser extent by
Commissioner Karen Douglas. These changes apparently began even before
the first “staff” version was published. In all, several months of
revision appear to have shifted the fuel temperature study from
modestly embracing consumer benefits, including fairness, to embracing
the oil industry’s rejection of any benefit from automatic temperature
compensation of fuel sales. In light of Commissioner Boyd’s clear
conflicts of interest in this matter, these changes appear skewed and
influenced by his ties to the oil industry, including his wife’s
employment as an oil lobbyist.
Click here to view a copy of Consumer Watchdog’s letter regarding the public records disclosures.
Consumer Watchdog has been fighting to require gas stations to adopt a
mechanism to ensure that motorists get a fair gallon of gas when they
fill up at the pump. It is estimated that California motorists lose
about $400 million each year to this hot fuel ripoff. Just as
important, drivers cannot determine their best buy at adjacent
stations, because the stations’ fuel temperatures vary—sometimes
widely. Gas stations in Canada, where colder temperatures would give
customers more energy per gallon when they fill up their tank, use
temperature adjustment systems to ensure that the oil companies get
fully paid for every gallon.
Click here to download key e-mails from the Public Records Act request.
Download the complete set of public records here:
Hot Fuel PRA Part 1
Hot Fuel PRA Part 2
Hot Fuel PRA Part 3
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Consumer Watchdog, formerly The Foundation for Taxpayer and Consumer Rights, is a nonpartisan, nonprofit organization.