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PA Bulletin, Doc. No. 05-812



Continuation of Fuel Cost Recovery Surcharge

[35 Pa.B. 2488]

Public Meeting held
April 7, 2005

Commissioners Present: Wendell F. Holland, Chairperson; Robert K. Bloom, Vice Chairperson; Kim Pizzingrilli

Continuation of Fuel Cost Recovery Surcharge; S.P. 28208


By the Commission:

   The Pennsylvania Public Utility Commission (Commission) by its Fuel Cost Recovery Surcharge Order at Special Permission Number 28208, ratified June 10, 2004, authorized call or demand, paratransit and airport transfer carriers under the jurisdiction of this Commission to adjust rates and fares to offset significant increases in the cost of fuel. The Order was amended by this Commission at the Public Meeting of November 18, 2004 in response to a petition presented by The Brotherhood of Unified Taxi Drivers/Owners, in which this Commission was requested to increase the amount of the surcharge in consideration of higher prices in the vicinity of Philadelphia.

   Initially, all call or demand carriers were authorized a fuel surcharge of thirty cents ($.30) per trip for each paying passenger, and all paratransit and airport transfer carriers were authorized a fuel surcharge of seventy cents ($.70) per trip for each paying customer. Medallion taxicabs were authorized to charge fifty cents ($.50) per trip (including trips to and from Philadelphia International Airport) for each paying customer as a result of the amendment of the Public Meeting of November 18, 2004. The fuel surcharge is to be in addition to officially filed tariff rates. The fuel surcharge became effective on June 14, 2004, and is scheduled to terminate on June 12, 2005.

   The order required the Bureau of Transportation and Safety to investigate the merits of the fuel surcharge on a quarterly basis, beginning September 30, 2004. As a result of the previous quarterly evaluations, this Commission ordered the continuation of the fuel surcharge. Furthermore, data gathered by the Bureau of Transportation and Safety in the course of evaluating the petition of The Brotherhood of Unified Taxi Drivers/Owners indicated that it was reasonable to consider amending the order for an increased surcharge for Medallion Taxicabs serving the Philadelphia area.

   In the process of conducting the final quarterly investigation, the Bureau analyzed current information available from the Energy Information Administration of the Department of Energy, the American Automobile Association, and OPIS Energy Group.

   At the time of approval of the fuel surcharge the average retail cost of regular gasoline was $2 per gallon. In the interval of January through March of 2005, the average retail price of regular gasoline on the East Coast of the United States was $1.95 per gallon. Although this figure indicates lower prices than those at the time of initiation of this surcharge, it is not an accurate representation of what has been happening with fuel prices.

   This winter's extremely cold temperatures in the northern portion of the United States have resulted in greater demand for fuel oil. In response to this increased demand for fuel oil, the nation's refineries have concentrated on heating oil production, thereby reducing the supply of gasoline. As supplies have started to decrease, the prices at the pumps have increased significantly starting in February of 2005. Although spring approaches and demand for heating oil will decrease, projections for the ensuing months are not optimistic.

   Reports from the Energy Information Administration of the Department of Energy, as well as the Oil Price Information service indicate continued increases. The price of crude is still unstable as prices rise above $55 per barrel, with no evidence of relief. Additionally, U.S. refineries are still expected to produce lower amounts of gasoline as the plants are temporarily closed for system modifications required for compliance with new government clean air requirements going into effect in 2006.

   After due consideration, we have determined that fuel costs have not substantially decreased. Based upon the evidence available, we are of the opinion that the passenger motor carrier industry continues to have a need for the fuel surcharge to permit the recovery of unanticipated fuel expenditures; Therefore,

It Is Ordered That:

   1.  The fuel surcharge established at Special Permission No. 28208 be continued.

   2.  The Secretary of this Commission shall duly certify this order and deposit same with the Legislative Reference Bureau for publication in the Pennsylvania Bulletin.


[Pa.B. Doc. No. 05-812. Filed for public inspection April 22, 2005, 9:00 a.m.]

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