Bill seeks gas
price ‘watchdog’

The proposed state agency
would monitor and report
on the petroleum industry

As gasoline prices soar across the nation -- with Hawaii leading the pack -- state lawmakers are considering a bill that would put the petroleum industry under closer scrutiny.

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The bill advanced by the Senate Commerce, Consumer Protection and Housing Committee yesterday would establish a state watchdog system to monitor and report on the petroleum industry. It would also fund the development of an energy strategy for the state.

"Right now we're flying blind without such a road map," said Mitch Ewan of the Hawaii Energy Policy Forum, a group of industry and government officials, as well as environmental groups.

Such a strategy could bolster regulatory reform and energy efficiency and alter the energy-wasting behavior of consumers, Ewan said.

Maurice Kaya, energy branch administrator for the state Department of Business, Economic Development and Tourism, spoke in support of the bill's intent.

Something must be done to aid the state in collecting information on the industry -- an effort that is already included in the Lingle administration's two-year budget request, Kaya said.

Among the information to be collected would be crude oil costs, refinery operating expenses and overhead costs.

The department contends that gathering the information is key to planning for the future, encouraging competition and determining whether oil companies are gouging consumers.

According to the latest survey by Trilby Lundberg, who publishes the semimonthly Lundberg Survey of 7,000 gas stations across the country, the highest gas price in the nation was $2.34 per gallon in Honolulu.

Gas prices are higher across the state. According to AAA's Daily Fuel Gauge Report, Hawaii's statewide average price yesterday for a gallon of regular unleaded was $2.44; the average price in Hilo was $2.46, while Maui recorded the highest price -- $2.69.

The nation's average price for a gallon of unleaded yesterday was $2.07, according to AAA.

Supporters of the state's gas price cap law -- set to go into effect this September -- say there is no economic reason for Hawaii's gasoline prices to be typically higher than other states. Opponents say Hawaii's antibusiness climate and high taxes drive up the costs.

The new bill would increase the burden of the industry -- already contending with the gas cap law -- by adding more compliance costs and bureaucracy, Melissa Pavlicek said in testimony submitted on behalf of Western State Petroleum Association.

It would also, "require the disclosure of confidential, proprietary business and financial information to the government without adequate confidentiality protection," Pavlicek said.

Kaya said confidentiality is built into the proposed law and the state government does not intend to betray that confidence.

The measure heads next to the Senate Ways and Means Committee.