New venture lets motorists buy gasoline at fixed price

LYNN – With gasoline prices soaring well beyond $4 a gallon at filling stations throughout New England, a new venture offers motorists the opportunity to lock in the price.The Miami-based business is called MyGallons, online at www.mygallons.com, and its representatives claim that for an annual membership fee of $29.95, customers can take advantage of lower gasoline prices at participating filling stations. The corporate slogan: Tomorrow’s Gas at Today’s Prices.Participating companies include Exxon, Chevron, Shell, Getty, Citgo and other major oil companies, and more than 200,000 service stations are in the program, according to the MyGallons Web site.The pitch: Save money by pre-purchasing gas at today’s prices, then fill up with your MyGallons card when prices rise. No matter how high prices at the pump will go, the price of the gallons you’ve purchased will be locked-in.The arrangement resembles that used by home heating oil customers who purchase in advance enough fuel to stay warm over the winter. But does it work as promised?Here’s what the company says: “The MyGallons card will be accepted at most gas stations in the U.S. Basically, if a gas station accepts credit cards, they will accept the MyGallons card. The new location finder able to handle the traffic load will be available shortly.”However, the list of participating locations is unavailable, so there’s no assurance that your favorite filling station is in the mix.According to company spokesman Greg Salsburg, joining MyGallons is similar to any other price club, such as Sam’s or COSTCO. Membership is $29.95 annually for those who opt for automatic renewal, and $39.95 for those choosing manual renewal.Joining up provides each customer with a personal online account the shows how many gallons of fuel are available, a transaction history, current price for purchasing more fuel, and other related information.According to MyGallons, “You will also have the option of pre-purchasing fuel to add to your account at your current MyGallons price. The price of fuel frequently changes. The quote you see on your screen is good for making a pre-purchase at that point in time. When you pre-purchase fuel, you are locking-in the price on the gallons you are purchasing at that moment. Your ‘MyGallons price’ refers to regular unleaded fuel and includes estimated taxes based on your location.”Most MyGallons customers pre-purchase 100 gallons at a time, said Steve Verona, the company founder, who told reporters, “Basically, if you pre-purchased fuel for $3 a gallon from us a year ago and redeem today at $4 a gallon, you save a dollar at the pump. We lost a dollar, but we make it up with the hedging positions we set a year ago.”MyGallons purchases large quantities of gasoline and delivers it in small increments whenever its customers go to a filling station. The company even sends text messages or emails to its customers with information on prevailing gasoline prices in their area.The risk lay in the possible decline of gasoline prices, though that doesn’t seem likely nowadays. Should gas prices plummet, the MyGallons card holder would be stuck with the pre-paid purchase price.Verona said the company, founded over two years ago, makes sense because it’s no different than stocking up the home pantry with edibles before food prices rise.MyGallons cards could prove attractive to small retailers since the Voyager Network, the company that processes MyGallons’ transactions, charges fees that are far less than those they pay to credit card networks such as Visa and MasterCard, according to Verona. However, Voyager Network has since announced that it has no official agreement with MyGallons to process its transactions.Verona said he plans to widely advertise MyGallons in a few major cities during July and could limit membership if it appears the company cannot keep pace with the fuel demand.The Better Business Bureau of Southeast Florida and the Caribbean posted a report last week that gave My