Motor Fuels: Stakeholder Views on Compensating for the Effects of Gasoline Temperature on Volume at the Pump Page: 2 of 26
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Accountability. Integrity. Reliability
Highlights of GAO-08-1114, a report to the
Chairman, Committee on Science and
Technology, House of Representatives
Why GAO Did This Study
The volume, but not the energy
content, of hydrocarbon fuels, such as
gasoline and diesel, varies in response
to changes in temperature. Thus,
because of expansion, the energy
content per gallon of 90 degree fuel is
less than that of 60 degree fuel. States
and localities adopt and enforce
weights and measures regulations,
often using the model regulatory
standards published by the National
Institute of Standards and Technology
(NIST). Although technology now
exists to compensate for the effects of
temperature on gas volume, the costs
of doing so at the retail level have
become the subject of much debate
among weights and measures officials,
consumer groups, and representatives
of the petroleum and fuel marketing
GAO was asked to provide information
on (1) the views of U.S. stakeholders
on the costs to implement automatic
temperature compensation, (2) the
views of U.S. stakeholders on who
would bear these costs, and (3) the
reasons some state and national
governments have adopted or rejected
automatic temperature compensation.
To do this work, GAO reviewed NIST
and other documents and
congressional testimony; interviewed
stakeholders from 3 federal agencies,
17 states, and 15 groups representing a
variety of interests, including
consumers, truck drivers, and the oil
and gas industry; and interviewed
officials in 5 other nations.
Various stakeholders and officials
provided technical and other
comments, which were incorporated
in the report as appropriate.
To view the full product, including the scope
and methodology, click on GAO-08-1114.
For more information, contact David Maurer
at (202) 512-3841 or firstname.lastname@example.org.
Stakeholder Views on Compensating for the Effects
of Gasoline Temperature on Volume at the Pump
What GAO Found
The costs to implement automatic temperature compensation are unclear.
Most stakeholders said that implementing automatic temperature
compensation for retail sales would involve the cost to purchase, install, and
inspect new equipment on pumps, as well as costs to educate consumers
about the change. Some stakeholders said the costs to adopt automatic
temperature compensation ranged from $1,300 to $3,000 per pump, but none
had estimated the total costs nationwide, in part because complete data are
not available. Estimates of the cost to inspect the new equipment varied.
Officials in a small number of states said inspection times would increase by
20 to 50 percent, while officials in three other states said the costs would not
be significant. No stakeholders had developed estimates of the costs to
Stakeholders differ on whether retailers, consumers, or both would ultimately
bear the costs of implementing automatic temperature compensation at the
retail level. Some stakeholders, including state officials and industry
representatives, said that the costs would be passed on to consumers through
higher prices for fuel or other goods sold at retail stations. Others, such as
consumer groups, said that retailers and consumers would share the costs and
benefits. That is, some retailers could use funds they receive from major oil
companies for remodeling to pay for the equipment. These stakeholders also
said the benefits include consistent energy content for consumers and
improved inventory management for retailers. Stakeholder views were largely
based on professional judgment and general economic theory rather than on
studies or other data, and most stakeholders said that a comprehensive cost-
benefit analysis would provide policymakers with important information.
Governments that have adopted or permitted automatic temperature
compensation for retail fuel sales cited improved measurement accuracy and
greater equity between retailers and consumers as reasons for making the
change; those that have prohibited it largely cited concerns that the costs
would outweigh the benefits. Hawaii adopted temperature compensation
more than 26 years ago because it provided purchasing equity for the industry
and consumers. In 2008, Belgium mandated temperature compensation to
help ensure more consistent energy content for consumers. Canadian officials
cited improved measurement equity and accuracy as reasons for allowing
retailers to sell temperature-compensated fuel in the early 1990s. In the United
States, officials from eight states that have laws or regulations that prohibit
automatic temperature compensation said the decision should be based on an
analysis of the costs and benefits, with some expressing concern that the
costs would outweigh the benefits. None of the governments that have
adopted automatic temperature compensation have studied its impact.
United States Government Accountability Office
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United States. Government Accountability Office. Motor Fuels: Stakeholder Views on Compensating for the Effects of Gasoline Temperature on Volume at the Pump, report, September 25, 2008; Washington D.C.. (digital.library.unt.edu/ark:/67531/metadc296959/m1/2/: accessed January 22, 2019), University of North Texas Libraries, Digital Library, digital.library.unt.edu; crediting UNT Libraries Government Documents Department.