Connecticut Station Settles Over Hurricane Sandy Pricing Charges
Published in CSP Daily News
Norwalk Shell station signs agreement, pays $1,500 fine
HARTFORD, Conn. -- A Norwalk, Conn., Shell station has signed an agreement with the state Department of Consumer Protection and has paid $1,449 to the agency to settle allegations that the station raised its retail gasoline price by 10 cents per gallon on Nov. 1, 2012, without there being a corresponding increase in wholesale gasoline prices for that day. The conduct occurred in the immediate aftermath of Hurricane Sandy.
State law prohibits fuel suppliers from charging unconscionably excessive prices during times of abnormal market disruptions, such as storm-related disasters.
"Given that the state was in a period of abnormal market disruption due to the severe impact of Storm Sandy, we determined that the Shell station's 10-cent-per-gallon increase was not justified and constituted an unconscionably excessive price for gasoline," Consumer Protection Commissioner William M. Rubenstein said. "The retailer sold 4,830 gallons of gasoline that day at the increased price, but we are requiring him to disgorge three times the amount of that unfair profit."
The Shell station is known as Connecticut Avenue Shell. While the station does not admit to any wrongdoing, it entered into the agreement, which requires it to pay $1,449 to the Department of Consumer Protection for its complaint resolution, education and enforcement programs, the department said. It also agrees to comply with the letter of Connecticut's anti-profiteering law, which protects consumers from improper price increases during emergencies and disasters.
A statutory notice of an "abnormal market disruption" under Connecticut General Statutes Section 42-234 means that dealers are prohibited from charging unconscionably excessive prices for energy resources such as heating oil, gasoline, propane, natural gas, electricity and wood fuels, among others. Violators are subject to penalties.
An "unconscionably excessive price" may occur when there is a gross disparity between the price during the market disruption and the price in the ordinary course of business immediately prior to the market disruption and the price is not attributable to additional costs.