Energy group vets oil tax bill

LIHU‘E — Several environment-related bills are making their way through the state Legislature this year.

Chief among them is House Bill 2421, which would institute a $1 tax on each barrel of oil and establish various initiatives to “ensure Hawai‘i is energy and food self-sufficient and sustainable to the maximum extent feasible,” the legislation states.

“We have all this work ahead of us to move toward clean energy, but no money to do so,” said Rep. Mina Morita, D-14th District, who was among the bill’s 26 co-introducers in the House.

The bill was vetoed last year by Gov. Linda Lingle, and failing to override the veto “set us back,” Morita said during the most recent Apollo Kaua‘i meeting. “Now we have no money to deal with energy and food security.”

Taxpayers would be shelling out around five cents extra per gallon of gasoline at the pump if the bill passed, which would likely amount to an average of some $20 per person per year, Morita said.

“We have to be really aggressive on fuel efficiency, so we’re not being regressive,” she said, adding that the amount is negligible compared to the recommendation contained in the final draft of the Kaua‘i Energy Sustainability Plan, which calls for increasing the per-gallon tax by 50 cents.

“If you want to disrupt the whole system, that’s what you do,” she said regarding the 50-cent tax proposal, which Kaua‘i County Council members have also objected to.

“We’re between a rock and a hard place right now,” said Apollo Kaua‘i’s Sharry Glass on Sunday. “We have such a commitment to clean energy, which we have to transition to. On the other hand, there’s just no extra money in family budgets.”

While Glass expressed that she was “disappointed” HB 2421 didn’t pass last year, as the dollar per barrel of oil would have been “insignificant,” she said instituting some kind of “rebate for low income families” would be favorable this year.

Currently, the bill does provide a tax exemption for “commercial air transportation providers.” Rather than distributors paying $1.05 per barrel of oil, a five-cent tax would be charged for each barrel of “petroleum product that is aviation fuel,” the bill states.

Respectfully opposing the bill is the state Department of Health, according to a written testimonial provided by Director of Health Dr. Chiyome Leinaala Fukino.

“The DOH is uncertain and therefore concerned about the net effect of the bill,” the letter states. “If passed, measure may result in high income to the Energy Security Special Fund. On the other hand, if oil companies pass the tax along to Hawai‘i consumers, already paying the highest gas prices in the nation, the additional fuel taxes may depress consumption and may actually reduce the ERRF revenues.”

Also related to fossil fuels is HB 2517 which would prohibit any new “generation facilities” from using petroleum as their only energy source. Facilities would need to have the ability to utilize other sources, such as biofuel.

“This would force Kaua‘i Island Utility Cooperative to more vigorously pursue other renewable, cleaner options,” Glass said.

Morita said she has a problem with a fossil fuel ban because a “ban is premature” and “fails to look at jet fuel and ground transportation.”

“Currently, local production of biofuel crops is not available,” she recently wrote in her blog. “Imported biofuels are more expensive and in some cases actually have a larger carbon footprint than some of the petroleum products from Hawai‘i’s refineries.”

With the “financial situation of the state,” the “practicality” is not there when “we’re still a liquid fuel-based state,” she said at the Apollo Kaua‘i meeting. “It sounds nice, but should it be law?”

For more information, visit www.capitol.hawaii.gov.

• Coco Zickos, business and environmental writer, can be reached at 245-3681 (ext. 251) or czickos@kauaipubco.com.