As noted in the overview, to illustrate the possible, actual impact of the price regulation on consumers, the report here presents information based on the assumption that one half of the over-order obligation is passed on to consumers in the form of an increase in the retail price. According to Attachment 4d, a pass-through of half of the regulated obligation—or an average of 6 cents per gallon—would have cost the average New England resident about $1.38 per year. With variance in the over-order obligation amount year to year, the annual cost would have ranged from $0.75 to $2.35. The average household, comprising 2.5 people, would have seen an average price increase of $3.46 per year, with the annual cost ranging from a low of $1.87 to a high of $3.46.
Attachment 4e provides a further context for assessing the household annual net impact of the price regulation. This assessment also considers a pass through of one half of the average annual over-order obligation, on households of different income groups. The assessment is presented in context of their total income, total expenditures, and food expenditures.
Consistent with the above analysis, the cost of the over order obligation would have ranged from $2.47 to $4.90 per household. The average household depicted in the lowest income group represents a food stamp eligible household, depending on household characteristics. The impact in the $2.47 range, along with the associated impacts, is thus illustrative of the possible impact of the price regulation on this type of household. The higher cost occurring for the higher income groups reflects in part the fact that the household size is larger, and the fact that per-capita consumption is slightly greater.