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Contact attorney general about Juneau fuel prices

Posted: Wednesday, November 12, 2008

Since the middle of July, the price of a barrel of crude has dropped from more than $147 a barrel to less than $63 as of Oct. 25. People around the country are enjoying lower gasoline and heating oil prices. Even in Fairbanks, heating oil has decreased to less than $2.70 a gallon for large volume customers.

I recently visited Seattle and paid $2.72 a gallon to fill up my car with unleaded gasoline. When I returned to Juneau, I paid $4.19 for gasoline. Some places around the country are now paying less than $2 a gallon for gasoline.

I have to ask myself, why are we paying so much more here in Juneau? I realize that shipping adds to the cost, but not that much. I've also been told the companies are working off past shipments and when they get in a new shipment, it will be reflected in the prices. However, I just talked with one of the companies that said it had just received a new shipment from a barge and it didn't do much to the prices.

It's pretty simple why we pay more in Juneau. In Juneau, we have a oligopoly, a few players that control the market. Instead of paying a reasonable price, we get gouged.

As of Oct. 27, the going rate for large volume heating oil customers ranged from approximately $3.40 a gallon to more than $4. Most people pay even more because they are buying in volumes of less than 1,000 gallons. In my fairly modest 1,900-square-foot house, it would cost me more than $2,500 with sales tax, based on a $4-per-gallon rate, to fill up my 600-gallon tank. This lasts, in the winter, around two to three months. You do the math.

The only way to change the price gouging from continuing is to put pressure on the local companies to bring the price down to reasonable levels. It doesn't do any good to call these companies and start cussing. That is why I have filed a complaint with the Attorney General's office.

If you feel the same, I urge you to file a complaint by going to www.law.state.ak.us, then click on the consumer protection link and download the form. You also can call the Attorney General's office at (907) 269-5100 and request a form that will be sent out to you. If enough people file complaints, the Attorney General's office will investigate it and file an action with the courts. Then we will see lower prices.

It's unfortunate that people have to go to this trouble just to try to pay a reasonable price to heat their house or fill up their car. This also is an example of why so many people are leaving Juneau, in that the exorbitant costs are driving people out. This was confirmed by a past study by the McDowell Group. If people can't afford to live and raise their families here, they are going to leave, which devastates the local economy.

• Elton Engstrom Jr. is a resident of Juneau.



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