Fuel temperature topic of California study

| 3/6/2009

The issue of fuel temperature at the retail pump has not gone away despite the significant drop in prices since the controversy over “hot fuel” began four years ago.

An upcoming meeting in California could determine whether the state Legislature takes steps to make automatic temperature compensation mandatory – or at least voluntary – at the pump or opts to do nothing at all.

If adopted, voluntary or mandatory automatic temperature compensation would ensure that consumers get exactly a gallon measured by temperature as well as volume. Fuel, like any other liquid, expands and contracts as the temperature rises and falls.

Current law addresses only volume, not fuel temperature. Research has shown that in warmer states, retailers have been allowed to sell expanded, or “hot,” fuel which leaves consumers with less energy in their tanks without even realizing it.

The California Energy Commission meets Wednesday, March 11, to discuss a fuel delivery temperature study commissioned by an act of the state Legislature under bill AB868.

The commissioned study urges the Legislature to settle an argument among industry stakeholders about whether automatic temperature compensation should be voluntary or mandatory, or even legal at all under the letter of the law.

The Owner-Operator Independent Drivers Association Foundation has contributed important research on fuel temperature and fuel mileage of truckers to the debate over “hot fuel.”

Truckers were among the first to point out issues with fuel temperature and the number of miles they get out of a tank of fuel.

OOIDA has urged governments to adopt automatic temperature compensation in the name of fairness to consumers.

Fuel retailers claim that adding temperature compensation devices to all fuel pumps will drive up the cost of fuel.

The commission study acknowledges automatic temperature compensation as the fairest way to sell fuel at the retail level, but the study also downplays implementation of temperature compensation because fuel companies will pass on the cost to consumers.

The California Energy Commission could vote Wednesday, March 11, to send the report to the Legislature with recommendations. There’s a chance the vote may not occur, as voting has been delayed at previous meetings.

Click here to view the commission agenda. The fuel temperature study is item No. 8. The meeting is scheduled to be Web cast at www.energy.ca.gov/webcast.

If the debate over fuel temperature is not settled by state legislatures or voluntarily by the fuel companies, the courts may eventually decide the fate of ATC.

Groups of consumers filed lawsuits in 2007 and 2008 demanding temperature compensation at all pumps and for the fuel companies to pay damages for profits made on “hot fuel.”

The lawsuits have been consolidated into one class-action case that is currently under the jurisdiction of the U.S. District Court of Kansas.

– By David Tanner, staff writer