Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2004

State of Hawaii

Sir:

Your Committees on Economic Development and Commerce, Consumer Protection and Housing, to which was referred S.B. No. 3170 entitled:

beg leave to report as follows:

The purpose of this measure is to establish new requirements regarding the blending of ethanol in gasoline.

Maui Ethanol LLC and Clean Fuels Hawaii testified in support of the measure. Tesoro Hawaii testified in opposition to the measure. The Department of Business, Economic Development, and Tourism offered comments on the measure.

Your Committees find that this measure seeks to reduce Hawaii's dependence on imported fossil fuels by mandating that a certain volume of ethanol be blended with gasoline by a time certain date.

Your Committees have amended this measure by removing provisions and definitions that could possibly conflict with the ongoing rulemaking process being undertaken by the Department of Business, Economic Development, and Tourism to enforce the provisions of the Petroleum Industry Information Reporting Act, and by making technical changes.

As affirmed by the records of votes of the members of your Committees on Economic Development and Commerce, Consumer Protection and Housing that are attached to this report, your Committees are in accord with the intent and purpose of S.B. No. 3170, as amended herein, and recommend that it pass Second Reading in the form attached hereto as S.B. No. 3170, S.D. 1, and be referred to the Committee on Ways and Means.