State Senator Thomas J. Herlihy, R-Simsbury, today joined other members of the legislature’s Energy and Technology Committee in voting for a measure that would ban zone pricing of gasoline in Connecticut.  According to Sen. Herlihy, the legislation that passed the committee would replace zone pricing with a fair wholesale price system making gasoline prices throughout the state more uniform.  

“We have an obligation to the consumers across the state to do everything within our means to reduce the price of gasoline.   Eliminating the zone pricing standard would be an enormous first step in that process,” said Sen. Herlihy.   “I cannot begin tell you how many calls I have received from my constituents asking why a gallon of gas in one location is at one price while at another location, right down the street, the price is entirely different.   There are two answers for this - it’s either price gauging or it is due to zone pricing.   In my opinion both practices are wrong.”  

Gasoline inventories, proximity to supply and local competition affect costs at the pump, as does ownership of the particular service station. About one-third of gasoline stations today are owned or leased by a major oil company. According to Sen. Herlihy, prices at these stations may be subject to “zone pricing” where oil companies charge dealers in different geographic areas a different price for the same grade of gasoline, depending on location and demand.   In fact, gasoline coming off of the same truck in one location may very well get a different price at another location based solely on zone pricing.
  
“Motorists are frustrated, we have all heard of the great success stories of the big oil companies’ record profits, but part of the reason for that is they are selling gasoline at prices higher than the market price,” said Sen. Herlihy.  “Retailers suggest that the wholesale price of gasoline could be as much as 36-cents per gallon cheaper than that of a zone priced system.  That could translate into a savings of between $5 and $10 per fill-up.  We all expect prices to increase as the summer driving season approaches. That is why I am hopeful that this legislation will be approved when it goes before the entire General Assembly.”