Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: FRIDAY, April 27, 1990 TAG: 9004270157
SECTION: BUSINESS PAGE: A11 EDITION: METRO
SOURCE: Associated Press
DATELINE: WASHINGTON LENGTH: Medium
The report by the General Accounting Office estimated that 9 percent of gasoline sold nationwide is mislabeled by half an octane number or more. And in several states where pump testing has actually proved mislabeling, the federal government has done little to stop the deception, the report said.
Rep. Philip R. Sharp, D-Ind., who released the report with Rep. Charles Schumer, D-N.Y., said the study was conservative and losses could reach as high as $600 million through growing mislabeling.
Sharp's estimate is based partly on the fact that more than half the samples taken by GAO, the investigative arm of Congress, in two large cities last year - Detroit and St. Louis - were found to have octane ratings an average of 2.2 or more points below what was posted on the pump.
A low-octane gas can cause an unhealthy "ping" or knocking sound in engines, reduce engine efficiency, mileage and emissions in high-powered engines, the GAO said.
Regular unleaded gas is rated at 87, with midgrade unleaded at 89 and premium grades from 91 to 94. Regular leaded gas is rated at 89. The difference in retail price between the lowest and highest grade can range up to 20 cents a gallon.
Sharp, chairman of the House Energy and Commerce subcommittee on energy and power, said he would introduce legislation to give states more enforcement power over octane cheaters.
The report said inspectors found in several states that some retail stations were selling gasoline rated at different octanes from the same storage tank.
At other stations, 87-octane unleaded regular was being sold as leaded regular, with an 89 rating, because the wholesale price for unleaded was lower, the report said.
"What this adds up to is a quiet but dangerous shell game for consumers," Schumer said.
A 1978 law requires the Federal Trade Commission and the Environmental Protection Agency to enforce compliance with federal petroleum marketing practices. But the GAO study said the agencies have not carried out testing since 1981. The report said both agencies cite lack of funding and staff.
Joe Koach, executive director of the 60,000-member Service Station Dealers of America, said he was "deeply chagrined because this broad-brushes the integrity of America's gasoline marketers." The organization supports stringent enforcement against octane cheaters, he said.
Nearly half the states conduct their own octane tests, and mislabeling has been minimal where testing acts as a deterrent, the study said.
But in seven non-testing states visited by GAO investigators, problems were found. Frequent octane mislabeling was found in one-time tests in Michigan, Missouri, Oregon and Tennessee, GAO said, and officials interviewed in Indiana, Montana and Washington expressed concern about octane cheating.
In 1989 tests conducted in Detroit, 51.9 percent of stations had inflated ratings averaging 2.3 octane points, and in St. Louis 52.6 percent had mislabeled an average of 2.2 points, the report said.
States that conduct their own tests and enforcement are Alabama, Arkansas, California, Colorado, Delaware, Florida, Georgia, Illinois, Iowa, Louisiana, Maryland, Massachusetts, Missouri, New York, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Virginia and Wisconsin.
Missouri and Tennessee began testing after the GAO inspections. Michigan, New York and Washington plan to begin testing, Sharp said.
by CNB