Gas, diesel prices up on the Island, mostly due to new federal standards

Prince Edward Islanders saw an increase in prices for gas, diesel and heating oil Friday morning.

While the increases were the result of the regular weekly price review from the Island Regulatory and Appeals Commission they were not regular, but mostly due to Irving raising prices in response to new federal clean fuel standards.

The minimum price at the pump for gas was up 5.8 cents to $1.692 per litre. IRAC said four cents (4.6 cents including HST) of that was response to clean fuel standards.

The minimum price at the pump for diesel was up 6.3 cents to $1.689 per litre. Again, four cents (4.6 cents including HST) of that was response to clean fuel standards.

The price of heating oil was also up, with an increase of 5.3 cents to $1.258. IRAC did not attribute any portion of this increase to the new regulations.

The hit was not as hard as expected. Some analysts were expecting an increase by as much as eight cents from Irving.

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Late last month, federal Environment Minister Steven Guilbeault said he was perplexed by Irving's decision to start increasing prices.

"Although the regulation enters into force on July 1st of this year, companies, refineries don't have to comply before July 1st of 2024," said Guilbeault.

"Why Irving would claim they have to increase the price of gasoline come this July is unexplainable for me."

Federal fuel charge takes and gives

It is the second time this month prices have gone up due to changes in federal regulations.

Prices also saw an extra jump last Saturday with the implementation of the federal fuel charge, which replaced the provincial carbon levy program. 

This increase was especially sharp on heating oil, which had been exempt from the provincial program. While the price of gas and diesel was up only 3.8 cents last Saturday, heating oil prices jumped 18.2 cents.

The federal program does more than just raise prices. It also comes with direct benefits for Islanders.

A rebate, worth $960 a year for a family of four, will be sent quarterly to Islanders who have filed federal taxes. That would be enough to cover the tax increase on six tanks of heating oil or twice-weekly fill-ups for an SUV.

The tax increase will also help cover funding to move P.E.I. away from its reliance on fossil fuels, including a $49 million program announced for the Island last week.

While prices in the last week are up about a dime for gas and diesel and a quarter for heating oil, they are not out of line from what they were just a few months ago. Gas and diesel prices were higher in mid-April, and heating oil prices were higher at the end of March.