Documents Show Political Appointees Interfered With Cal. Energy Commission Study...

Documents Show Political Appointees Interfered With Cal. Energy Commission
Study of Hot Fuel Ripoff to Protect Oil Companies

Consumer Group Says Government Staff's Consumer-Oriented Findings Were Altered
by Commissioners With Ties to Oil Industry

SANTA MONICA, Calif., March 11 /PRNewswire-USNewswire/ -- Public documents
retrieved by Consumer Watchdog reveal that, after private meetings with oil
industry representatives, some of the California Energy Commission's
politically appointed Board Members changed staff conclusions in a study of
"hot fuel," in a way that protected the interest of oil companies. In 2007,
the California Legislature asked the CEC for a "cost-benefit" report on the
issue of hot fuel - in which motorists get less energy per gallon of gas when
fuel temperature is above 60 degrees Fahrenheit - and if consumers would
benefit from gas pumps or other mechanisms that automatically compensate for
the temperature of the gas.

Newly found e-mails reveal a previously undisclosed private meeting with an
oil industry economist and later exchanges with staff ordering changes to the
study. In a November 26, 2008 e-mail, Commissioner James Boyd wrote of the
staff's conclusions that automatic temperature compensation (ATC) was
desirable and legal:

"Bad news, the Executive Summary is totally slanted to one conclusion. The
last bullet question on Page 3 and the response thereto on Page 4 HAVE GOT TO
GO. You cannot speak for the consuming public in a way that leaves no other
conclusion than go with ATC."

In addition to the revelations in the newly released documents, Consumer
Watchdog points out that Commissioner James Boyd's wife is a longtime lobbyist
for the oil industry's chief lobbying group, the Western States Petroleum
Association. Last month, Consumer Watchdog called on Commissioner Boyd to
recuse himself from the hot fuel study because of this irresolvable conflict.
See the letter to Commissioner Boyd at:
http://www.consumerwatchdog.org/resources/CECLetter2-9-09.pdf

"Governor Schwarzenegger cannot let political appointees who are married to
oil industry executives reverse the findings of government staff with
expertise on these issues," said Judy Dugan of Consumer Watchdog. "The hot
fuel ripoff costs California drivers up to several cents a gallon in the heat
of the summer. Consumers deserve fairness at the pump."

In a letter sent to the Energy Commission Tuesday evening, the nonprofit,
nonpartisan Consumer Watchdog asked the Commission to delay a vote on the
compromised study until after the public had an opportunity to review over 350
pages of public records received by Consumer Watchdog on Monday night. The
letter also demands more information about the original, uncompromised staff
recommendations.

In the letter, Consumer Watchdog wrote:

The newly released documents, obtained under our Public Records Act request,
show that changes essentially reversing the conclusions of the CEC
professional staff and steeply favoring the oil industry, were requested by
Commissioner James Boyd and to a lesser extent by Commissioner Karen Douglas.
These changes apparently began even before the first "staff" version was
published. In all, several months of revision appear to have shifted the fuel
temperature study from modestly embracing consumer benefits, including
fairness, to embracing the oil industry's rejection of any benefit from
automatic temperature compensation of fuel sales. In light of Commissioner
Boyd's clear conflicts of interest in this matter, these changes appear skewed
and influenced by his ties to the oil industry, including his wife's
employment as an oil lobbyist.

A copy of Consumer Watchdog's letter regarding the public records disclosures
is available at:
http://www.consumerwatchdog.org/resources/CECLetter3-10-09.pdf

Consumer Watchdog has been fighting to require gas stations to adopt a
mechanism to ensure that motorists get a fair gallon of gas when they fill up
at the pump. It is estimated that California motorists lose about $400 million
each year to this hot fuel ripoff. Just as important, drivers cannot determine
their best buy at adjacent stations, because the stations' fuel temperatures
vary--sometimes widely. Gas stations in Canada, where colder temperatures
would give customers more energy per gallon when they fill up their tank, use
temperature adjustment systems to ensure that the oil companies get fully paid
for every gallon.

Key e-mails from the Public Records Act request can be downloaded from:
http://www.consumerwatchdog.org/resources/HotFuelPRA_KeyDocs.pdf

The complete set of public records can be downloaded from:
http://www.consumerwatchdog.org/resources/HotFuelPRA_part1.pdf
http://www.consumerwatchdog.org/resources/HotFuelPRA_part2.pdf
http://www.consumerwatchdog.org/resources/HotFuelPRA_part3.pdf

Consumer Watchdog, formerly The Foundation for Taxpayer and Consumer Rights,
is a nonpartisan, nonprofit organization.

SOURCE Consumer Watchdog

Judy Dugan, +1-213-280-0175, or Doug Heller, +1-310-392-0522 ext. 309, or
Jamie Court, ext. 327, all of Consumer Watchdog