Gasoline prices in southern B.C. run about 13 cents per litre higher than other jurisdictions, and six cents higher in the north, for reasons that a B.C. Utilities Commission panel was not able to determine.
The BCUC released its final report on B.C. gasoline and diesel prices Friday, finding that while there is small number of wholesale suppliers to B.C., the panel found no evidence of collusion between producers.
The reasons for the price gap with other parts of Canada are “unexplained,” panel chair David Morton said Friday.
The panel says the B.C. government could consider regulating retail prices, as is done in Nova Scotia, with a price set once a week and the cost of regulation added to the price as an additional tax.
Jobs, Trade and Technology Minister Bruce Ralston said the BCUC findings vindicate the sense B.C. customers have that they are being “ripped off,” with wholesale supply restricted to four major producers.
“Our government is concerned with the allocation of refined gasoline flowing into B.C., as well as the lack of transparency around how the gas price is set,” Ralston said.
Premier John Horgan called the inquiry in May after gasoline prices soared to new highs, breaking the North American record in Metro Vancouver with prices reaching $1.70 per litre. Horgan hinted at collusion between fuel producers and retailers to increase profits, rejecting suggestions that his government’s opposition to expanding the Trans Mountain pipeline adds to supply restrictions that push B.C. prices up.
Horgan also directed that the BCUC not to consider fuel taxes for carbon emissions, transit and federal and provincial taxes, which are among the highest in Canada.
Representatives of gasoline suppliers appeared at the hearings, rejecting the suggestion they were orchestrating high prices and detailing the rising taxes and cost pressures on B.C. Among them was Parkland Fuels, which now runs the former Chevron refinery in Burnaby that is the last producer of gasoline and diesel in southern B.C.
“With the supply of refined products shipped via the Trans Mountain pipeline having been sharply constrained since 2015, B.C. demand has been met by ever more expensive sources of supply from as far away as California, the U.S. Midwest and the Gulf Coast,” Parkland said in its submission to the BCUC.
Fun with pipeline data from @NEBCanada. In 2018, most of flows on @TransMtn pipeline were for export to the US. Chart courtesy of @IHSMarkitEnergy. pic.twitter.com/ilOYRzfkv4
— Kevin Birn (@KevinBirn) March 21, 2019
Parkland listed the cost increases it and other producers have faced in B.C. since 2015, including carbon tax increases, a 21 per cent increase in minimum wage, credit card costs and rising property values. B.C.’s carbon tax rose in April to $40 a tonne of carbon dioxide emissions, which translates to 8.89 cents on a litre of gasoline and 10.23 cents for a litre of more carbon-intensive diesel.
Trans Mountain’s 65-year-old line delivers refined fuels as well as crude from the Edmonton area to Burnaby refining and shipping, as well as refineries in Washington. National Energy Board statistics show that for 2018, more than half of its flow, 158,000 barrels per day, was crude exports to the U.S., with another 62,000 barrels per day directed to export via tankers filling at Westridge terminal in Burnaby. Another 47,000 went to the Burnaby refinery and 27,000 barrels per day was devoted to refined products.
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