Price Gouging Legislation
to be Introduced
December 02, 2008
Senator Bill Wielechowski (D-Anchorage) announced Monday that
he will introduce legislation to make price gouging a crime in
Alaska. And then today three Democrats announced they will file
legislation to relieve Alaskans from paying the highest gas prices
in the United States.
More than 30 states have price gouging laws, and legislatures
in more than 12 states are considering adopting or strengthening
Wielechowski says his bill will focus on ensuring that essential
energy supplies are affordable.
"In an energy rich state like Alaska, residents deserve
to know they will be charged a fair and reasonable price for
critical energy supplies, like gasoline to drive their cars,"
In the past year, gasoline spiked to almost $5/gallon in Anchorage
as well as in Ketchikan and more than $8/gallon in the Bush.
Heating oil hit $9/gallon in some remote communities, and the
price of natural gas continues to climb.
"The bottom line is it's not ok to gouge Alaskans on needed
energy supplies," Wielechowski added.
The bill will apply when prices skyrocket without justification.
Those found guilty can be charged a fine of not more than $25,000
and treble damages.
The bill will also stiffen penalties for anti-trust violations,
where it can be proven that two or more suppliers colluded to
inflate prices. Alaska's anti-trust penalties are currently woefully
"We hope this bill will send a message that price gouging
in Alaska will not be tolerated." Wielechowski said. "We're
putting the golden rule into law for those who never learned
Anchorage Democrats Pete Petersen,
Chris Tuck and Les Gara will introduce the House legislation.
Petersen and Tuck are newly elected. A similar effort is being
undertaken by members of the Alaska Senate. This bill is aimed
to help ensure essential energy supplies are affordable to consumers,
and to protect local Alaska economies. In Alaska the price of
gas in urban areas approached $5 per gallon this fall, and is
still roughly $1 per gallon higher than in many places in the
Lower 48. The problem is worse in Rural Alaska, where prices
have hit $9 per gallon in some places.
"Alaskans shouldn't be
paying the highest prices in the nation," Petersen said.
"This price gouging bill should help to restore our fuel
prices to a reasonable level."
More than 30 states have price gouging laws to address high prices
following hurricanes, and other unusual circumstances that have
led to unfair consumer pricing.
"We need to make sure Alaskans can afford to heat their
homes and commute to work," Tuck said. "When price
gouging occurs, local economies suffer."
Evidence shows Alaska's two refiners are using their market position
to overcharge gas retailers and distributors for finished fuel
products, including gasoline. Knowing Alaska's only alternative
is to ship gasoline and diesel up from the Lower 48, refiners
are basing their pricing on that high cost, rather than upon
the lower price their pay for the Alaska crude oil they process.
The sponsors intend to send the message that price gouging in
Alaska isn't acceptable. For those refiners that don't hear this
message, the legislation will allow the state to intervene to
establish a "just and reasonable" price under
rules the state's Regulatory Commission of Alaska already enforces
on other utilities.
"We hope the refiners will treat Alaska's businesses and
citizens as their neighbors," Gara said. "If not, then
we'll have a tool to prevent those who'd take excessive profits
during difficult economic times."
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