California bill tackles ‘hot fuel’ issue

| Wednesday, June 20, 2007

A California state lawmaker is calling for a study to analyze the problem of so-called “hot fuel” along with possible solutions to make sure consumers get what they pay for at the pump.

State law now regulates fuel temperature and measurement for purposes of dispensing fuel at retail facilities.

Federal government standards put a gallon of fuel at 231 cubic inches at 60 degrees. The 60-degree mark is a century-old agreed-upon sta`ndard for the petroleum industry. When fuel is above the temperature threshold, it becomes an issue for consumers because the amount of energy it produces drops significantly.

The issue is particularly troublesome in California where the weather is consistently warm, and truckers and others pay among the highest fuel prices in the nation. During the state’s summer months, fuel expansion is expected to cause consumers to overpay for fuel by $228 million, the Los Angeles Times reported.

Sponsored by Assemblyman Mike Davis, D-Los Angeles, the bill would require a study and cost benefit-analysis, and to make recommendations to the Legislature about future legislation and regulations regarding the reference temperature for fuel dispensation. The information must be submitted by Dec. 1, 2008.

The Department of Food and Agriculture, in partnership with the California Energy Commission and the state Air Resources Board, would conduct the research. Information would be collected during routine dispenser inspections.

The issue of hot fuel is drawing a lot of debate nationwide. Earlier this month, a congressional subcommittee met to point a critical finger at fuel retailers and oil companies for profiting from retail gas and diesel sold at temperatures topping 60 degrees.

Supporters of protections for consumers, including the Owner-Operator Independent Drivers Association, contend that automatic temperature-compensation equipment should be installed on all U.S. fuel pumps. They say that would be the best way to ensure consumers truly get their moneys worth at the pump.

Advocates for the equipment point out that such technology exists in Canada – where average fuel temperatures are generally below 60 degrees. In Canada, retailers and oil companies installed the equipment voluntarily after determining that cool fuel was eating into their profits.

The California bill – AB868 – is awaiting final consideration on the Assembly floor. If approved there, it would move to the Senate.

– By Keith Goble, State Legislative Editor
Keith_goble@landlinemag.com

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