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Plaintiffs claim retailers are paying taxes on gallons of colder gasoline, which take up less space, and then keeping extra taxes when heat expands the fuel into more, less-efficient gallons at the pump.
Georgia consumers have been getting burned at the pump because of the weather to the tune of $123 million, even before gas prices reached the boiling point, according to statistics released by the federal government.
Even a federal lawsuit filed in Rome has raised the issue of how the temperature of fuel when pumped can cost consumers — especially those in warmer states.
Click to view a PDF of the lawsuit filing.
National Institute of Standards and Technology data shows temperatures of fuel at gas stations around the country average about five degrees warmer than the federal standard temperature of 60 degrees at which gas is priced to sell.
At Georgia gas stations, according to the federal agency that presented the data, that temperature is 12 degrees higher at 72 degrees.
The physics behind the problem is fairly simple.
At 60 degrees, a 231-cubic-inch gallon of fuel delivers a certain amount of energy.
At 90 degrees, however, the same gallon of fuel expands to more than 235 cubic inches.
Because consumers are still paying for 231-cubic-inch gallons they are forced to spend more money — and pay more tax — for the same amount of energy.
In practical terms, this means a Roman who pumped 10 gallons of gas into his truck at 90 degrees would be able to drive 196.6 miles, if the vehicle is supposed to get 20 miles per gallon.
In Alaska, with 60-degree gas, someone in Juneau with the same truck would be able to drive 200 miles on 10 gallons.
Nationally, consumers paid more than $2 billion more because of the temperature differences, according to NIST.
Dr. Richard Suiter, the NIST researcher who presented the data, said the figures were compiled by a company that manufactures and monitors gas station tanks.
Suiter said 20 to 25 tanks were evaluated in every state to compile the data, but this only shows “one snapshot in time.”
The lawsuit filed Tuesday in U.S. District Court in Rome claims fuel distributors gain further as they keep the excess tax paid, too.
The lawsuit brought by private citizens and three Northwest Georgia trucking companies, including Ellison and Sons Trucking and W.E. Hicks Inc. both of Floyd County, is demanding gas distributors return tax revenue the plaintiffs say has been illegally acquired.
While consumers pay tax on the volume they pump, no matter what the temperature, large-scale customers pay tax upfront on gas set to 60 degrees.
Since the store pays tax only at the 60-degree level, they retain the excess tax revenue.
Besides returning the “tens of millions of dollars” the plaintiffs claim has been “pocketed” by the retailers, this and about 20 similar lawsuits around the country are looking for laws to be changed.
Specifically, the Northwest Georgia plaintiffs are seeking the retrofitting of gas pumps to fix the problem.
Consumer advocates cite changes in Hawaii and Canada that have been made. In Hawaii, a base fuel temperature of 80 degrees has been set. As a result, retailers dispense 234 cubic inches per gallon rather than 231.
In Canada, where cold fuel once cost retailers money, the industry has supported a voluntary program to retrofit to pumps that automatically adjust volumes based on temperature. In response to all the legal action, the Congressional Committee on Government Reform’s Domestic Policy Subcommittee on Friday is scheduled to hear testimony on the issue.
The subcommittee is expected to examine the impact on consumers and attitudes of the oil industry, according to records.
