7-21-09 by dugan
Is it hot out? Well, so’s your gasoline. You’re losing a few cents a
gallon each time you fill up at the pump. And no, with today’s
insulated underground tanks, you can’t get cooler fuel in the morning.
You just have to pay, while the dealer and oil companies reap some
extra profit at your expense.
One senator is paying attention: Sen. Claire McCaskill of Missouri has reintroduced a bill (S. 1476) that would gradually require gas stations to pump gallons that take temperature expansion into account,
giving you the same amount of energy in every gallon. Her bill counters
last week’s cave-in by the National Conference on Weights and Measures,
which punted the hot fuel issue under pressure from oil companies and
gas station chains.
Here’s the key paragraph from McCaskill:
As gas prices rise amid the summer travel season,
U.S. Senator Claire McCaskill today reintroduced legislation that will
help protect consumers at the gas pump…. Currently, retailers measure
gas at 60 degrees Fahrenheit, but when gas expands in warmer months,
consumers get less gas for their money, costing Americans an estimated
$2.57 billion annually. McCaskill is continuing to work to address the
problem with the FAIR (Future Accountability In Retail) Fuel Act of
2009 legislation requiring the installation of automatic temperature
compensating equipment in all retail gas station pumps.
The new pumps, installed over several years, would add a little bit of
extra gasoline to your purchase if the gasoline was at a temperature
above the federal "reference point" of 60 degrees–which is most of the
time in warm states like Florida, Arizona and California, and most of
the summer in almost all states. Oil companies and fuel wholesalers buy
and sell their products with similar temperature adjustment, so only
drivers at the pump get the short end of a gallon when it’s warm out.
McCaskill’s bill coincidentally comes at the same time that the
National Conference on Weights and Measures, which is supposed to
assure fairness in consumer purchases–like getting the same amount of
milk in every half-gallon carton, or limiting the amount of water
pumped into your supermarket turkey–decided to be fair only to the oil
and fuel industries. It indefinitely tabled a proposal backed by
California’s forward-looking regulators that would encourage
temperature compensation at the pump. The group basically said that
since its industry members didn’t like the idea, it wouldn’t act.
Here’s how the regulators’ action was described in the (subscription-only) fuel dealer publication Oil Express:
The National Conference on Weights and Measures
(NCWM) has withdrawn two proposals – one would have made [automatic
temperature compensation of fuel] mandatory, the other would have left
the decision up to retailers. The move at the NWCM’s San Antonio
meeting this week came after a key committee heard from more than 40
state officials and industry representatives who opposed the concept
and reviewed studies, testimony and letters on the issue…
Since when are regulators supposed to do exactly what the regulated
industry wants, without regard for what’s fair to consumers? Drivers
have no idea of the temperature of the gas they’re buying, even though
the temperature can vary by up to 15 degrees at stations near each
other. Gas stations know exactly what temperature their gasoline is,
when they buy it and when they sell it. The pennies a gallon they get
from hot fuel are completely profit, and untaxed as well. If they sell
in the millions of gallons a year (not unusual), that’s a lot of gravy.
Lobbyists for truck stop operators, gasoline chains and other industry groups crowed with glee about their victory.
"NCWM operates as a consensus organization," says John Eichberger, a
VP with the National Assn. of Convenience Stores. "Given the
overwhelming opposition expressed against these proposals, the
conference realized that it was impossible to move forward with the
issue. This can be considered a full repudiation of the ‘hot gas’
allegations and the ATC issue in general."
That’s money talking. All the money that the industry groups "contribute" as "associate members" of the NCWM, funding its entertainment and outings,
keeps paying off. Consumer groups like ours, of course, don’t think
regulators should accept that kind of money, and we couldn’t afford to
do the same thing ourselves even if it wasn’t unethical. In addition to
the direct money issue, the industry often hires the regulators when
they retire, giving them a lucrative second career.
The same herd of lobbyists dominated a California study in which a state
agency accepted the lobbyists’ paid "research," laundered it and put it
out with the state’s imprimatur. One state commissioner on the panel is married to the
state’s chief oil lobbyist. That commissioner demanded changes that favored the industry. No wonder the conclusion of the California
Energy Commission was that consumers would "not benefit" from fixing
hot fuel. That’s the sort of "study" the NCWM was looking at when it
rejected a fix for hot fuel.
Lobbying bucks have made it a losing battle for consumers, at least for now. But there are glimmers of future success. Costco has agreed to put in temperature-adjusting pumps
at many of its retail outlets, as partial settlement of an ongoing
national lawsuit against hot fuel. And Sen. McCaskill’s bill keeps the
issue alive nationally, acting as a rebuke to regulators who are far
too chummy with the industries they regulate.
Click here for more info on hot fuel.