State’s ethanol fuel law comes under fire

Pacific Business News - February 4, 2011

By: Curtis Lum

By the state Legislature this session is a Senate measure that would repeal a law mandating that gasoline sold in Hawaii contain at least 10 percent ethanol.Senate Bill 715 was introduced by Sen. Mike Gabbard, D-Kapolei-Waikele, and was scheduled for a hearing before the committees on Commerce and Consumer Protection, and Energy and Environment Thursday. If approved, the bill would do away with the 10 percent ethanol requirement that has been in place since 2006.The law was intended to reduce Hawaii’s dependence on foreign oil and gasoline consumption, and encourage the development of facilities to produce ethanol and other biofuels.But no ethanol plants have been built in the state and all of the ethanol used in Hawaii’s gasoline continues to be imported, which Gabbard said runs counter to the purpose of the law.“We’re just basically importing it like fossil fuel,” he said. “And this goes against our goals of becoming more sustainable in supplying both our energy and our food needs.”The state did not disclose the amount of ethanol imported to Hawaii. But state tax records show that 411 million gallons of gasoline were purchased in fiscal year 2010, meaning 41 million gallons of ethanol, or 10 percent, were used to make the fuel.Pacific West Energy Kauai LLC was one of several companies that announced plans to build an ethanol plant when the law was passed. But the company, along with others, faced tough permitting and leasing obstacles, and a drop in ethanol prices because of a glut on the Mainland, which led to some companies pulling out of Hawaii.William Maloney, Pacific West Energy Kauai president, said he’s still committed to building a $90 million biomass power plant and a $40 million ethanol facility on Kauai. Plans call for the power plant to be operating in 2013 and the ethanol facility a year later.