Government agreed with Powell River advocates about unfair gas prices, says MLA

Drivers in BC can look forward to more transparency and greater accountability when it comes to gasoline and diesel fuel prices.

The provincial government has announced regulations that will require fuel wholesalers to report in detail how pricing works in the wholesale market.

Powell River-Sunshine Coast MLA Nicholas Simons said largely because of advocacy from here in Powell River and the lower coast, the government agreed that gas prices seemed unfair and asked British Columbia Utilities Commission (BCUC) to look into them.

“They found that the market wasn’t competitive, so government passed a law requiring companies to produce records, and today the rules for that law came into force,” said Simons. “This shows how advocacy can work, so I’m glad to see this day. I’m grateful to minister [Bruce] Ralston for listening to our concerns and to the people who work in the public sector who drafted these new rules.”

Simons said everyone who advocated for this should feel a real sense of satisfaction, and like everyone else, he’s looking forward to seeing the results in fair gas prices.

In a teleconference, minister of energy, mines and petroleum resources Bruce Ralston said for many years, BC drivers have felt like they have been gouged when they go to the pumps to fill up.

“People were frustrated because they saw gasoline prices shooting up for no apparent reason,” said Ralston. “Our government was concerned about this as well, so we asked the BC Utilities Commission to investigate the rise of gasoline prices in our province. Through their investigation, the BC Utilities Commission found that our gasoline market is not truly competitive.

“They found a considerable markup on the price of gasoline, including a 13-cent-per-litre premium being charged to drivers that the industry could not explain. This premium results in British Columbians paying an extra $490 million every year.”

Ralston said in response to these findings, the government brought in the Fuel Price Transparency Act (FPTA), which was passed in fall 2019. He said the government’s goal with this legislation is to bring transparency and clarity to BC drivers and send a message to oil and gas companies that the days of setting prices in total secrecy are over.

Ralston said he was happy to announce the next step in making gas prices transparent, which came into effect on August 14.

“We are bringing into force regulations to help track how pricing works in the wholesale market,” said Ralston. “These new rules will impose requirements for companies that import, purchase, store and distribute gasoline and diesel products into the wholesale fuel market in British Columbia. It will apply to fuel wholesalers who purchase and supply gasoline and diesel fuel intended for gas stations that sell gasoline to BC drivers.”

Ralston said the government knows from the BCUC investigation into gas prices that four companies control about 90 per cent of the wholesale market in southern BC. He said companies will have to begin providing regular submissions to the BCUC with detailed information on their fuel imports, bulk sales, wholesale prices and storage capacity.

“BCUC has the power to publish this information in order to promote transparency and competition in the market,” said Ralston. “They recently launched a new website called gaspricesbc.ca to provide the public with facts and information on the factors driving gasoline prices across the province.

“All these steps are taken as we pull back the curtain of secrecy and keep companies publicly accountable for unfair markups and cost increases that cannot be explained. This will help us to bring fairness and transparency to the price BC drivers pay at the gas pump.”

Ralston said the legislation will require that in October, for fuel company wholesalers to send in data they would collect in the course of business. He said the first set of prices should be available in November.

“What we expect is scrutiny, that is, the public access to the way in which prices are set, will moderate and have an effect on prices,” said Ralston. “When a company feels people are looking over their shoulder, they are much more likely to be cautious in advancing unexplained spurts in prices that they were not obliged to explain in the past.”

In March 2020, the BCUC was named as the independent administrator of the FPTA and given the power to collect and publish data on fuel pricing in order to promote competition in the market.

Further regulations are also being developed for the other parts of the fuel supply chain, including the retail market.