Lawmakers A group of House members has decided against a specific cap for Hawaii's gas price, which was advocated recently by the state's lead attorney in its suit against the oil companies.
renew push for
crude-based cap
The House group drops
its bid for a specific capBy Tim Ruel
truel@starbulletin.com
The bipartisan group is instead renewing a push for a crude oil-based cap proposed earlier this session.
It's harder for the oil companies to manipulate crude oil prices, Rep. Paul Whalen (R, Kona) said at a press conference yesterday afternoon.
Other members of the group include Democratic representatives Hermina Morita, Kenneth Hiraki and Ed Case, who plans to run for governor this year.
At a briefing Wednesday at the Capitol, the state's outside attorney, Spencer Hosie, suggested the Legislature create a price control by tying local gas prices to a combination of several West Coast market prices reported from the Oil Price Information Service, or OPIS. The cap would reduce gas prices by an average of 20 cents per gallon, Hosie said.
OPIS prices in California are prone to moving up and down, while crude oil prices are more regional and stable, Whalen said. The group's proposal calls for fixing the statewide wholesale gas price to 3.5 percent of the average price of four different crude oils, Alaska North Slope, Saudi Arabian light, West Texas Intermediate and North Sea Brent.
The benchmark would be reviewed quarterly, and the result would be a 40-cent to 50-cent reduction, on average, on a gallon of local gas.
Meanwhile, the oil companies would have to settle for profits that are more comparable to the mainland average of 5 to 10 cents a gallon, Whalen said. Chevron made an average of 18.8 cents a gallon between 1991 and 1998.
Gov. Ben Cayetano said yesterday that he would support a price cap that is fair for Hawaii's drivers as well as the oil companies.
"My first impression is that it's fair," he said. "We don't want to invite unnecessary legal challenges."
Legislature Directory
Testimony by email: testimony@capitol.hawaii.gov
Legislature Bills & Hawaii Revised Statutes
Include in the email the committee name; bill number;
date, time and place of the hearing; and number of copies
(as listed on the hearing notice.) For more information,
see http://www.hawaii.gov/lrb/par
or call 587-0478.