Oil Companies Make Money From Summer Heat
by Lloyd Alter, Toronto on 06.20.07
If one needs yet another excuse why the oil companies are fighting controls and supporting deniers, here it is: the warmer it gets, the less gas they sell you in a gallon. It seems that in the States a gallon of gas is measured at sixty degrees farenheit; when it is warmer out the gas expands but you still are just buying volume, not energy content, so you are getting less. The warmer it gets, the more you are overcharged, by as much as US$ 1.5 billion per year. “People are paying for gasoline they’re not getting,” said Rep. Dennis Kucinich.
The industry says it would be too expensive to change all the pumps, yet in Canada, where the average temperature is colder and the customer benefits from getting more gas per unit volume, somehow the oil companies found the money to change to pumps that automatically adjust volumes based on temperature. Funny how that works. ::MSNBC via ::the Oil Drum
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in MN most gasoline at service stations are in the ground buried below frost depth. Ground temperature is relatively constant at 55 degrees farenheit.
Be smart, know when you will need to fill up, and do it early in the day (on the way too work, not back) or when its raining .
"yet in Canada, where the average temperature is colder and the customer benefits from getting more gas per unit volume, somehow the oil companies found the money to change to pumps that automatically adjust volumes based on temperature."
Gas is still significantly more expensive in Canada than the U.S., so how exactly are Canadian consumers getting a "benefit".
Also, you're wrong that temperature compensation benefits Canadians, since gasoline volume is corrected to 15 degrees C at the pumps. The average yearly temperature, almost anywhere in Canada is nowhere near that warm. 15 deg C is a rarity where I live. So you could say we're actually getting ripped off by temperature compensation.
In any case, it's largely unnecessary, as another person noted, since bulk fuel tanks at gas stations are underground. The temperature remains pretty consistent. Also, the thermal coefficient of expansion for gasoline is rather small, and given the relatively small quantities with which it is purchased, a worst-case error might mean a three cent difference on a tank of gas.
Given Kucinich's political reputation for drumming up silly publicity, I'm guessing he's rather desperate if he thinks Americans are going to start measuring out gas with an eye-dropper.
However, this is just the kind of conspiracy drivel that appeals to Kucinich's technically illiterate constituency, and he knows his customers, right?
Dear anonymous at 11:26 pm,
it might be a good idea to fully understand an article before arguing against it. especially when you quote from it!
The oil companies change the pumps to work against Canadians, as per the article [and the quote you added to your reply].
So you could say we're actually getting ripped off by temperature compensation.
ummm, yes. exactly. again, as per the article.
Canadians are being ripped off because the government has encouraged and allowed temperature compensation, just as U.S. consumers would be if the government did the same. Temperature compensation is not required in Canada but is allowed at retail. Since Canadian temperatures are less than 15C generally, allowing temperature compensation means that the station owner (at a constant price per liter) is paid slightly more than he would be if the pumps were not compensated. This allows him to post a slightly lower price, a competitive advantage, and which offsets the cost to rig the pump for temperature compensation. Consumers are at a disadvantage because some stations have compensated pumps and some do not, so comparisons they make based on price may not be valid. Also, the Canadian governments make out like bandits because they collect prices based on the amounts shown on the pumps. Temperature compensated pumps slightly inflate the cost of gasoline pumped, so the governments make out better. One estimate I've heard (Canadian TV) fixes that amount at about $90 million a year.
U.S. consumers would be potentially ripped off in two ways. Allowing temperature compensation would result in the same confusion Canadian consumers experience with price comparisons. Mandating temperature compensation would result in additional costs for the station owner, which he would presumably pass on the consumers. If you think somehow the service station operators would have exactly the same price in a compensated pump as opposed to the previous non-compensated, well you're entitled to your belief. But that has never been demonstrated, and an economist would think it unlikely that companies would, in effect, give away fuel for nothing. They're not that dumb.
As for Dennis Kucinich. He was described during his Cleveland experience as being one of the worst mayors in America. They used to call him Dennis the Menace. So now he's in Congress, where his accountability is zilch. You would think he might have retired from public, um, service. Maybe he should open a gas station somewhere and see what it's like.