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The Honolulu Advertiser
Posted on: Wednesday, April 14, 2010

Hawaii stuck over a barrel

By Jerry Burris

There's an interesting conversation going on right now at the Legislature over the idea of substantially raising the tax on imported oil the so-called "barrel tax" from today's nominal 5 cents a barrel to a buck-five a barrel.

Originally conceived as a way to generate money that would help Hawai'i move away from its independence on imported oil, the barrel tax has now morphed into another way to raise money to balance the overall budget. We all have to buy gas, right?

It might take a bit of political courage, but lawmakers should return to original principles: The only way we are ever going to get ourselves off the imported oil lifeline is to develop our own alternatives. And that ain't cheap.

The best way to pay for development of alternative sources is to tax the source we now use, whether we like it or not: imported oil.

There is a growing possibility that Hawai'i may soon be without a "domestic" refiner turning oil into the gas and airline fuel we all depend on. Chevron, for instance, seems about ready to walk. Sure, it will continue to ship in jet fuel and gasoline, but at what cost?

Shipping schedules and the vagaries of weather and international demand will decide how much oil energy we have to power our economy.

The only logical approach is to develop our own domestic source of fuel and energy that is independent of the world's choices. The military recognizes this, with its new emphasis on energy independence and the concept of shifting to biofuels that can be produced locally to keep our defenders flying.

Long-term planners in the military recognize that when the "worst thing" happens, we are on our own and we might as well begin planning for that moment now.

True, the optimists among us believe that doomsday will never come. And it might not. Security people cannot afford to take that bet.

The day of "peak oil" will come. That is the day when demand clearly exceeds supply.

For an oil-dependent isolated state such as Hawai'i, it makes sense to get ahead of that day. A modest increase in the tax on the oil we consume today should be invested in tomorrow, not on the short-term pressures of balancing the budget we face today.