Group Urges Honest Measurement of Gasoline to Stop $1.5 Billion Ripoff
Santa Monica, CA — A Congressional study finds that motorists nationwide will be cheated of $1.5 billion over the summer driving season because they’re buying “hot fuel,” said the Foundation for Taxpayer and Consumer Rights. A Congressional subcommittee is holding hearings today on this overpayment, possibly leading to federal regulations that would measure gasoline temperature at the pump and provide motorists with a fair measure of gasoline for their money.
“The report shows that motorists will pay $1.44 extra for every fill-up when gasoline going into the tank reaches 90 degrees, which is common in summer,” said Judy Dugan, research director of OilWatchdog.org and FTCR. “This sleight of hand perpetrated by oil companies, distributors and dealers is part of the dishonesty and profiteering that permeate the gasoline business.”
The overpayments just for the summer months will amount to $228 million for California drivers, the study found. The Kansas City Star, which conducted the original investigation of the “hot fuel” issue, reported yesterday on the study, prior to its release later today. Read the story here.
The story concisely explains the problem:
“The physics of hot fuel are fairly simple. Fuel expands and contracts depending on temperature. At 60 degrees, the 231-cubic-inch U.S. gallon puts out a certain amount of energy. But fuel is often sold at much hotter temperatures, causing the fuel to expand and the amount of energy, for each gallon of volume, to decrease.
“At other stages in the fuel-delivery chain, the industry routinely adjusts volume for temperature change. But retail pumps in America make no adjustment for changes in the volume caused by temperature, so consumers get only 231 cubic inches per gallon, regardless of temperature.”
Today’s hearing before the House Domestic Policy subcommittee, led by Rep. Dennis Kucinich, questioned oil industry and dealer representatives about the deliberate overcharging.
Earlier studies found that the year-round cost of hot fuel to consumers, at current gasoline prices, is $2.3 billion nationally and at least $450 million in California, where temperatures year-round are higher. Gasoline in Canada is almost universally sold through pumps that measure temperature going into the tank. Oil companies and dealers benefit from this measurement in Canada, where gasoline is on average under 60 degrees Fahrenheit, said FTCR.
“The refining and distribution industries lobbied for temperature measurement in Canada by saying that any other method would be dishonest,” said Dugan. “In the U.S., they are trying to prevent temperature measurement because honesty would dip into their profits.”
Gilbarco Corp., a manufacturer of temperature-adjusting gasoline nozzles, briefly said it would sell them in California this spring, then withdrew the offer under apparent pressure by gasoline distributors. FTCR has asked state Atty. Gen. Jerry Brown to investigate the withdrawal and the wider issue of hot fuel.
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