New Brunswick has been overestimating the cost of federal clean fuel regulations on oil companies and have allowed consumers to be overcharged by millions of dollars since last July as a result, two expert witnesses told an Energy and Utilities Board hearing this week.
Timothy Auger of the group Advanced BioFuels Canada and Vijay Muralidharan of Calgary-based R Cube Economic Consulting Inc. are each challenging a formula adopted last year by the EUB to calculate the cost of federal clean fuel rules on oil companies.
This week, that formula is allowing oil companies to add 5.22 cents per litre to the price of gasoline and 5.82 cents to the price of diesel in New Brunswick to pay for the cost of regulations that took effect nationally in July.
Every one cent added to petroleum prices in New Brunswick costs consumers about $1 million per month at the pumps.
This is the best summary I could come up with:
New Brunswick has been overestimating the cost of federal clean fuel regulations on oil companies and have allowed consumers to be overcharged by millions of dollars since last July as a result, two expert witnesses told an Energy and Utilities Board hearing this week.
Timothy Auger of the group Advanced BioFuels Canada and Vijay Muralidharan of Calgary-based R Cube Economic Consulting Inc. are each challenging a formula adopted last year by the EUB to calculate the cost of federal clean fuel rules on oil companies.
“It simply takes the highest cost option and applies it across the board in the entire fuel pool, and that misses the point we are trying to make here — that that is not a likely scenario.”
In his evidence, Muralidharan also criticized Grant Thornton’s estimate of the cost of clean fuel regulations, saying they exaggerate expenses faced by oil companies.
He suggested amounts allowed in New Brunswick since July were consistently more than double what consumers should be charged and recommended Grant Thornton’s formula be reined in.
Its minister, Steven Guilbeault, heavily crticized the EUB’s original decision and pledged to have his officials show up at the first opportunity to prove clean fuel regulations involve little cost to oil companies in the early years.
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