Changes the baseline price for determining maximum pre-tax wholesale gasoline price from the average of spot daily price of gasoline in New York, the Gulf Coast, and Los Angeles to the average of the spot daily price of gasoline in Singapore, Taiwan, Korea, and Venezuela.

A BILL FOR AN ACT

SECTION 1. In setting the maximum pre-tax wholesale price of gasoline, Act 242, Session Laws of Hawaii 2004, established a baseline price for regular unleaded gasoline to be the weekly average of the spot daily price for regular unleaded gasoline for Los Angeles, New York Harbor, and the United States Gulf Coast.

To assist it in implementing the maximum pre-tax wholesale price program, the public utilities commission engaged the consulting firm of ICF Consulting, LLC. In its report of April 15, 2005, an initial finding of ICF Consulting, LLC was that the baseline gasoline prices established may not be the most appropriate. IFC Consulting, LLC noted that the United States imports one million barrels of gasoline per day, with the bulk of the imports going to Florida, the east coast, and the west coast. Accordingly, if the State were to import gasoline, the three locales stated in the baseline would not be likely sources of gasoline. More likely, the sources of any gasoline imported into the State would be the far east, including Singapore, Taiwan, or Korea, or Venezuela and other Caribbean sources. These sources already export gasoline to the United States and in many instances to the locales set forth in the baseline for the State's existing maximum pre-tax wholesale gasoline price.

The purpose of this Act is to change the baseline price for regular unleaded gasoline in determining the maximum pre-tax wholesale gasoline price to reflect actual worldwide gasoline market conditions.

SECTION 2. Section 486H-13, Hawaii Revised Statutes, is amended by amending subsection (c) to read as follows:

"(c) The baseline price for regular unleaded gasoline referred to in subsection (b) shall be determined on a weekly basis and shall be equal to the average of:

as reported and published by Platt's or the Oil Price Information Service for the five business days of the preceding week; provided that the commission, in its discretion, may determine a more appropriate baseline or a more appropriate price information reporting service."

SECTION 3. Statutory material to be repealed is bracketed and stricken. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.