What I would give to drive into a gas station and see fuel prices under $1 per gallon. Doesn’t seem like it was that long ago when our youngest son was in college and gas prices in Prescott, Ariz. were 99 cents a gallon.
It’s been about 12 years ago since that scenario, one I’m certain we’ll never see again. I’ve become more sensitive to gas prices now that I’ve retired, live on a fixed income but still want to travel by car around the western United States.
I vowed earlier this year that creeping fuel prices wouldn’t stop me from a planned trip to Glacier National Park, driving my big Ford pickup and hauling a 25-foot travel trailer. Overall, I got about 11 mpg, but it was difficult to swallow when each fill-up topped $80.
But what really struck me was when I got home and filled up our 4-cylinder SUV and the pump registered nearly $60. We bought the SUV last year, a 2013 Kia Sorento, with an 18-gallon tank. One of the primary reasons we chose this particular car was it had third-row seating and a much better EPA fuel rating than the 6-cylinder competition equally equipped.
Shortly after purchasing the vehicle, we received a letter from Kia explaining that during the complicated EPA testing process, Kia discovered its rating was in error. Consequently, it agreed to pay us the difference of what was the stated EPA mileage (22 mpg city and 28 mpg highway) and the actual mileage over the life of the SUV. That equates to about a penny a mile at current gas prices.
That may sound like a paltry amount but I figure if I keep the car until it has 100,000 miles on it, I will receive about $1,000 from Kia to help pay for my gas. Any way to save on gas is OK with me.
Gas price escalation has led me to a place I never thought I would go: Federal regulation of oil companies and gas prices. I have always been a free-enterprise advocate, but the older I get the more benefits I see to regulation of certain limited commodities, certainly ones like power, water and fuel.
I know there have been discussions about gutting some of the EPA regulations on fuel efficiencies. Automakers have some pretty tough numbers they must meet: 34 mpg by 2016 and 54 mpg by 2025. Manufacturers would like to see those numbers relaxed.
If we ever want to see the cost of transportation decrease, it will be through fuel efficiency, not through price of gas at the pump. Let’s keep the pressure on the oil companies and the car manufacturers to find cheaper ways to power our vehicles around town and around the country.
One report I read said that if the 54 mpg rating were to be met, U.S. fuel consumption would drop about 2 million barrels of oil a day, the equivalent of one-half of what OPEC imports to the U.S. today. With better fuel efficiency, gas prices wouldn’t necessarily change but the real dollar savings would equal about $1 per gallon.
So let’s not fiddle too much with EPA mandates. In fact, let’s put more stringent regulations on Big Oil. Why should oil companies make outlandish profits when they jack up prices during so-called shortages or spikes when refineries have malfunctions?
Perhaps we should allow the government to fix the profit margins on oil companies, much like it has done with utility companies for decades. Establish some reasonable rates of return and keep those numbers constant. We’ll see smaller fluctuations in prices at the pump.
There’s also the possibility that oil companies, faced with fixed profits, will look for better internal efficiencies and better management practices that will benefit us all.
Each state has its own set of taxes that will still result in an overall spread in gas prices across the land, but the regional differences should be smaller.
Putting more stringent rules on the oil companies might be a catalyst for them to develop new technologies that will eventually lower our thirst for fossil fuels.
Bill James is a retired Daily Republic editor and publisher now living in Meridian, Idaho, a suburb of Boise.