Gas, diesel retailers to see increased margin starting Friday

Gas and diesel retailers in Nova Scotia will get to keep a little more from the price at the pumps starting on Friday, to cover lost sales during the pandemic.

The amount hasn't been set yet, but the province's consumer advocate says it needs to be fair to drivers, as well.

Hilda Cormier, co-owner of the PetroCanada station in Cheticamp, said she applied to the Nova Scotia Utility and Review Board last year for an increase in the retail margin because tourism was in the tank.

She said she is just grateful the board is granting some help for rural retailers.

"It kind of makes us think that at least our voices were heard and they believe us," Cormier said. "It's a very hard time. We've been in this since 1976 and this is the hardest year we've had to cope with and it's not over yet."

As an interim measure, the UARB granted retailers an increase in their margin of about a third of a cent per litre in February.

'This is great,' says Cormier

Now, it is considering a consultant's report that offers the board three options, all of which will add to the cost drivers pay for fuel.

The first option, which the board has said it is leaning toward, adds about a cent per litre to the retail margin, with that amount falling over time.

Cormier had initially applied for three cents per litre last year, but is not disappointed with the UARB consultant's report.

"I mean, we always want more, but ... this is great," she said.

She sells both gas and diesel, and said sales were OK before the latest restrictions were implemented about three weeks ago, but most rural retail stores are feeling the pinch now.

"I hope they open at least the [Atlantic] bubble for the summer," Cormier said.

"That would save all the businesses down here. If they don't, I think there's going to be a pile going under."

'Cheticamp is a ghost town'

With restrictions set to ease, Cormier said she can't wait for the increased margin and increased sales.

"Hopefully, the volume will start going up and people will start travelling," she said. "Right now, Cheticamp is a ghost town."

The proposed margin increases under the first option are based on a rolling 12-month average of actual sales compared to the same months before and during the pandemic.

The second option is a month-by-month comparison that adds under a penny to the margin and also falls over time.

The third option is a fixed margin increase — about a third of a cent per litre for minimum priced gas and four-tenths of a cent for maximum price — averaged out over time.

All three would expire in 2023, when retail sales of fuel are expected to return to pre-pandemic levels.

David Roberts, a lawyer with the Halifax firm Pink Larkin and the consumer advocate for the UARB, said the board should not choose its first option.

"From the perspective of consumers, this is the most expensive option and it also appears to do what the board said it wasn't going to do in its original decision, which was to look back into the period of the first months of the pandemic and compensate for losses experienced at that time," he said.

The other options are fairer to drivers and base compensation rates on actual sales compared to pre-pandemic volumes, Roberts said.

The UARB has said barring major objections to the first option, the board will make a decision later this week and add the increased margin to the fuel rate it sets on Friday.

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