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DCCUMENT RESUME
03413 - CA2493617j 42&&trt±fe-d3 /Q2~-Z kl-,2-,9lr7
(Federal Energy Administration's System for Monitoriig Heating
Oil Prices]. Et1D-77-63(aj; B-178205. August 25, 1977. 3 pp. +
enclosure (14 pp.).
Report to Sen. Patrick J. Leahy; by Elmer B. Staats, Comptroller
General.
Issue Area: Energy: Effect of Fcderal Financial Incentives, Tax
Pclicies, and Regilatory Policies on Energy Supply (1610).
Contact: Energy and Minerals Div.
Budget Function: Natural Resources, Environment, and Energy:
Energy (305).
Organization Concerned: Federal Energy Administration.
Congressional Relevance: Sen. Patrick J. Leahy.
Authority: Energy Policy and Conservation Act (89 Stat. 871).
Emergency Petroleum Allocation Act of 1971 (87 Stat. 627).
Under the monitoring syster established by the Federal
Energy Administration (FEA) to insure that heating oil price
levels remain reasonable, YEA collects -rice information from a
survey of about 600 firms and compares tie average of these
survey prices tc an index price which is FEA's best estimate of
what average heatin9 oil prices would have been had they
remained under price controls. Findings/Conclusions: Overall,
the sampling plan is reasonable and fairly represents
residential heating oil users. The design of the PEA regional
and national monitoring systems is sufficiently sensitive to
increases in residential prices so that a similar monitoring
system designed specifically for residential heating oil prices
is not necessary. Survey and sampling errors are reasonably
small, and sampling errors havs been insignificant for the past
heating season. Recommendations: The Administrator of the
Federal Energy Administration should: conduct periodic test
surveys of heating oil firms which are outside the FEA's present
sample but within its sampling frame to determine if these firms
reflect higher prices because they are not constrained by the
requirement of submitting monthly price reports to FEA; continue
its weekly mcnitoring system and include nonresidential prices
as well as residential prices; reevaluate the appropriateness of
r full two-cent flexibility factor and provide an analytical
Justificaticn for whatever flexibility factor value it
determines appropriate; examine the feasibility of using FEA's
yearly data instead of the adjusted 1975 Bureau of Mines data to
calculate survey end index prices; and reevaluate its heating
oil price monitoring system in terms of the blending of #1 and
#2 fuel oil and, if necessary, make adjustments to the index
foriula to account for the impact of blending. (SC)](ViewImageLocal?handle=hein.gao/gaobaacpz0001&div=1&collection=&method=preview&ext=.png&size=3)