Labrador MHA wants fuel prices dropped
PUB says review is coming
Torngat Mountains MHA Lela Evans is disappointed the Public Utilities Board (PUB) won’t consider lowering fuel prices in northern Labrador.
Evans made the request to the PUB after prices in central Labrador and parts of the south coast dropped considerably in recent weeks. When the PUB raised the gasoline prices by 30 cents per litre to address concerns by the suppliers, Evans contacted the board to see if it would adjust the prices on the north coast, Zone 14, to bring them in line with the other areas.
“I asked it to keep with the board's mandate in fairness and marketing of petroleum products. They gave a benefit to businesses. They raised the prices in the Cartwright and Upper Lake Melville region. I’m not asking for the full freeze to come off, I was just saying give the residents of the north coast a similar benefit.”
She said residents in the region have to deal with high food and energy costs, and a price reduction for gasoline and stove oil could help lessen that.
The PUB told Evans the prices, set in the fall each year, reflect the costs of purchasing, shipping, storing and selling the products. Since there isn’t any evidence of change in the costs along the supply chain since the fall of 2019, the PUB said, reducing allowed maximum prices would require retailers to sell at a loss. They had no way to accommodate her request, the PUB said, under the current regulatory framework.
George Murphy of the Consumer Group for Fair Gas Prices said he understands why people in the zone may want the prices to change based on market conditions, but the price freeze that’s in place can protect both sides. He said people might see a benefit from the lower prices when the price is set for next year.
“We could end up seeing the last gasoline rolling into Labrador in the fall and the prices start to rise again. They could see the benefit of a freeze moreso than the rest of the province would.”
Evans said she understands why the prices are frozen in the zone, but the current dramatic change in oil prices should have an impact.
“There’s always risk in business when you’re a supplier, but the PUB is protecting businesses from risk at the expense of Labradorians and I take exception to that. I ‘m not saying that to be disrespectful, but the PUB has to own that.”
REVIEW COMING
The PUB has a full review coming of all fuel pricing models and adjustment mechanisms in Labrador, for all the zones. Evans said she does agree with the review, but doesn’t feel it will have much impact.
“It’ll always be the interests of businesses first over the residents on the coast,” she said. “I don’t think that review will change much at all. I’m not hopeful for it.”
Murphy said the review is coming at a good time and he is interested in seeing what comes out of it. The limited number of suppliers and limited routes for getting fuel to Labrador create a challenge for the residents, he says, but also for business.
“It is what it is. It would be practical to have it so it swings on the world conditions, but the simple fact is there probably wouldn’t be a supply of gasoline up there.”
Murphy said because of the size of the population and the challenge in getting fuel into the region, it would be difficult to ensure the integrity of the supply if the freeze was removed.
The dates for the review have not been announced, but Murphy said he would expect to see something from the PUB in the next few months.