Group wants AG to probe gas pumps, saying consumers are gouged

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The Contra Costa Times (California)

SACRAMENTO, CA — A consumer group urged California’s attorney general Monday to investigate a North Carolina company’s decision not to sell a gasoline pump that allows the amount of fuel sold to be adjusted based on its temperature.

The Foundation for Taxpayer and Consumer Rights said motorists in warm-weather states such as California can be shortchanged when they fill up without the type of gas pump made by the company.

The Santa Monica-based group suggested that Gilbarco Veeder-Root decided not to market the fuel pump and a retrofit device to upgrade existing pumps because of pressure from the oil industry.

“Gilbarco’s decision not to sell its product could only be in its own economic interest if oil companies threatened to boycott its other products, non-temperature adjusted pumps,” Jamie Court, the group’s president, said in a letter to Attorney General Jerry Brown and U.S. Sen. Barbara Boxer, D-Calif.

“Now that regulators have done their job and certified the technology to cool down the hot-fuel market, the oil companies should not be allowed to pressure manufacturers to deny motorists an honest measure of the gasoline they pay for.”

The attorney general’s office is reviewing the request, spokesman Nathan Barankin said.

A spokeswoman for Boxer, Natalie Ravitz, said the senator planned to talk to Gilbarco’s chief executive officer about why the company decided against selling the temperature-sensitive pumps. The senator also will ask the Federal Trade Commission to investigate if she decides the explanation isn’t satisfactory, Ravitz said.

The Gilbarco equipment is designed to deal with the fact that gasoline and diesel expands and contracts based on its temperature.

Pumps currently measure fuel based on an assumption that its temperature is 60 degrees. When its temperature increases, gasoline and diesel expand, giving motorists less energy per gallon. The opposite happens when fuel temperatures drop.

In a report Sunday, the Kansas City Star said the average year-round temperature of gasoline and diesel in service station tanks is 64.7 degrees. That means motorists are paying an extra $1.7 billion a year for fuel.

Backed by another consumer group, Public Citizen, truckers and motorists have filed several lawsuits in recent months, contending that failure to adjust fuel volumes for temperature changes defrauded service station customers.

Temperature-adjusting pumps are used in most stations in Canada, where fuel temperatures average less than 60 degrees, with the oil industry’s support.

California became the first state to allow sales of the Gilbarco pump when the Division of Measurement Standards approved it in January.

Spokesman Steve Lyle said the division found that the Gilbarco product was a “reliable device” but was not taking a position on whether service stations should use it.

Lucy Sackett, a spokeswoman for Gilbarco, did not return telephone calls from The Associated Press seeking comment.

She told the Star that the company made “business decisions” not to sell the pump in the United States and not to seek certification of the retrofit equipment.

“It doesn’t make sense for us to move on it at this time,” Sackett told the newspaper. “We have to listen to our customers.”

There was “no effort” by the oil industry to pressure Gilbarco into abandoning plans to sell the pump, said Jay McKeeman, vice president of government relations for the California Independent Oil Marketers Association.

But he said some of the group’s members, which include service-station owning fuel distributors, were upset because of “the way Gilbarco has handled this thing.”

He said there was a concern that some station owners would buy the Gilbarco equipment and claim they provided an advantage to consumers.

“We don’t necessarily oppose the implementation of the devices,” he said. “We just think this is a very premature way to introduce the technology into the market. Basically, no one has done a good cost-benefit analysis to understand whether the consumer benefits.”

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