House Tackles Gas Price Disparities

Apr 2, 2013

The House Transportation Committee is considering a bill that would explore why gasoline prices are higher in certain areas of Vermont.

Gas prices in the northwestern part of the state have been considerably higher than many other regions. The average disparity in prices in Chittenden County is about 22 cents.

Rep. Chris Pearson, P-Burlington, is sponsoring a measure that would require distributors to provide data to the attorney general’s office.

Pearson told the Transportation Committee on Tuesday that his bill would prevent collusion while supporting economic development.

“When we have inflated gas prices in Chittenden County and in the northwestern part of the state, that’s money that is going to a small number of distributors and is essentially staying out of the pockets of residents in that part of the state,” Pearson told lawmakers.

Ryan Kriger, an assistant attorney general, said the information would be welcome.

“At the moment, we’re just kind of blind,” Kriger said. “So getting any data would certainly be a great first step to try to get our hands around this.”

Kriger strongly supports the bill, which would also require that all mergers in the fuel industry be reported to the attorney general.

“Just because a merger is reported to our office, that doesn’t mean we have the data to be able to determine if it’s a good merger or a bad merger. That’s where the market share information comes in – the reporting of the amount of fuel sold,” Kriger said.

House Transportation Committee Chairman Rep. Pat Brennan, R-Colchester, said lawmakers want to explore whether there are other ways to save the consumer money “by getting rid of the disparity in pricing throughout northern Vermont and in Chittenden County in particular.”

“It could be a revenue neutral thing by the time we’re done,” Brennan said. “Who knows?”

For months, Sen. Bernie Sanders has said he wants to make certain that a number of gas stations are not colluding to set prices. What impact exists when you have a very small number, I think you have three owners who control a majority of the gas stations in the northwest part of the state, what does that mean?” Sanders said last summer. “Is there the kind of vigorous price competition that we need?”

The Federal Trade Commission investigated gas prices at Sanders' request and found that they were higher in northwestern Vermont than it would have projected. But the FTC suggested it didn’t suspect illegal activity, telling Sanders no further investigation is planned.