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Delta gas prices highest in North America
Delta consistently ranks among the highest gasoline pump prices on the continent, according to statistics collected by the website www.gasbuddy.com.
On a North America-wide comparison of prices taken Aug. 8, all 10 of the most expensive cities were from Metro Vancouver and within the regional TransLink surtax catchment.
Industry experts agree that taxes have driven pump prices to unbearable levels in the Lower Mainland.
“The main reason is taxes,” said Michael Ervin, who heads a consulting firm for the petroleum industry. “The Lower Mainland of B.C. is the highest taxed region in North America and so it would not surprise me that municipalities within that region would score pretty high in terms of pricing North America-wide.”
Ervin said once all the taxes are stripped away, pump prices are fairly uniform across the country, notwithstanding short-term differences based on supply and demand.
The Lower Mainland has access to supply from Western Canada via Kinder Morgan’s Trans Mountain pipeline as well as foreign imports from Asia and the U.S.
But Ervin said pricing in B.C. is subject to supply shortages mainly because of limited Kinder Morgan pipeline capacity coming from Alberta. That situation likely won’t change if any new pipeline projects are built to carry Alberta crude to the east coast, the U.S. Gulf coast or across northern B.C. to Kitimat.
“That can have a tightening effect on prices, in other words fuel prices can be higher as a result of that factor,” he said, adding coastal B.C. still has access to fuel shipments via boat.
The high price of gasoline in Tsawwassen is a good reason for many drivers to brave the long border lineups and head to a gas station in Point Roberts, where as of Monday premium gasoline was selling for $1.259 compared with $1.445 for regular here.
“I’ve noticed a consistency in Canadian drivers coming down,” said Leanne Gerber, a gas station attendant at the Texaco in Point Roberts. “We’ve always had at least 70 per cent of our customers are Canadian and have been for the last several years.”
Gerber said the gas station has been able to build its business based on reliable Canadian cross-border visits.
“It’s been a boon for us.”
Jordan Bateman, B.C.’s director for the Canadian Taxpayer Federation, calls it the “Blaine Drain” effect.
“Generally speaking, the higher the taxes the higher the price of gas and we see this most clearly by comparing the Lower Mainland to Blaine, Washington,” he said.
Bateman said if one strips away all the taxes and converts the currency, gas prices on both sides of the border would be virtually identical.
“Or close enough that nobody would ever cross the border for gas,” he said.
In the Lower Mainland, drivers within Metro Vancouver pay a per litre surtax of 17 cents to TransLink, 6.67 cents for the carbon tax, and 30.06 cents for federal and provincial excise taxes. Without the TransLink tax, cities outside Metro Vancouver enjoy gas prices that are close to the national average. Bateman said that means Abbotsford receives a similar economic boon as cross-border towns for drivers seeking cheaper fill-ups.
“If Delta could actually get out of TransLink and lower gas prices at their stations they may actually find a little mixed industry of people from around the Lower Mainland flocking to Delta to buy gasoline,” he said.
Correction: An earlier version of this story wrongly referred to the Enbridge Northern Gateway pipeline as the Keystone XL pipeline, which will travel to Texas.