The B.C. government has asked the B.C. Utilities Commission (BCUC) to investigate record breaking gas prices.
Premier John Horgan sent a letter to the BCUC on Tuesday morning asking for the independent regulator to put forward a “common set of facts” for why prices have ballooned in the province.
“They will compel testimony, they will talk to people in the industry, they can talk to consumers, they can talk to people affected by this and come up with some rationale for what has happened that we can all agree with,” Horgan said.
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Horgan spoke to Prime Minister Justin Trudeau on Monday night about British Columbia’s concerns over prices. Horgan says he did not want to start the BCUC investigation before he had a chance to speak with Trudeau.
Horgan added that he brought his concerns about gas prices up, and explained the severity of the problem. One of the main concerns raised by the B.C. premier is the high percentage of raw bitumen flowing through the federally-owned Trans Mountain pipeline.
“The prime minister owns a pipeline that comes in to Burrard inlet. That pipeline is not bringing enough refined product to have relief for British Columbians,” Horgan said.
“I told him I was disappointed to see so much bitumen come through the pipe at the expense of refined product.”
Trudeau says he will be asking his officials to look at what the government can do. Gas prices have surged to over a $1.70 per litre over the last month.
Horgan says it will take time for the BCUC to report back. The terms of reference have still not been established.
But the B.C. government says Ottawa could immediately increase refined product being shipped west through the Trans Mountain pipeline. Horgan says that would alleviate some of the demand pressures and in turn should lead to a decrease in gas prices.
“We need an independent arbiter to lay out to the public how we got here. A one cent increase in the gas tax should not translate to a 40 cent increase to the cost of a litre of gasoline,” Horgan said.
The BCUC will look at why the refining profit margins are far greater in British Columbia compared to other jurisdictions in Canada. The B.C. government says the margins for Vancouver are more than double the Canadian average.
The BC Liberals have been blaming the provincial government for not doing enough to keep prices down. Horgan says the increase has nothing to do with provincial increases to the carbon tax, rather the problem is a lack of refined product and “gouging” from gas companies.
Liberal leader Andrew Wilkinson has been calling on the provincial government to cap gas prices to provide immediate relief for drivers. The Liberals have launched an ad campaign with billboards placed in metro Vancouver blaming the province for the high price at the pumps.
“Provincial taxes are not to blame,” Horgan writes in the letter to the BCUC.
“Cutting taxes would amount to the public subsidizing oil companies, as there is nothing to stop companies from raising prices in response,”