Pay To Play: Hawaii Proposes ‘Vacation’ Tax Hike To Fund Climate Change Projects

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ENB Pub Note: The Democratic supermajority in Hawaii is going to be a case study on what not to do. Their energy and fiscal policies are some of the worst in the world. We will be covering some of the major issues in future articles. The energy mix in Hawaii is a problem, and “renewable” energy is only part of the problem. It is the politicians creating a fund or tax that they can control, which will only hurt Hawaiians due to bad energy policies. 

Hawaii’s electricity generation is heavily influenced by its isolated geography, lack of local fossil fuel reserves, and reliance on imported fuels, though renewables are growing rapidly. The following data primarily reflects 2024 figures, as reported by Hawaiian Electric (serving 95% of the state’s population across Oahu, Maui, Molokai, Lanai, and Hawaii Island) and other sources, with projections and trends for 2025.
  • Renewable Energy: Approximately 36% of electricity generation in 2024, with expectations of further growth in 2025.
    • Solar Power: The largest renewable contributor, accounting for ~19% of total electricity in 2023, with 38.4% of renewable electricity in 2017.
      • Small-scale rooftop solar: Provides the majority of solar generation, with 916 MW installed capacity in Hawaiian Electric areas as of March 2020, and 61 MW added in 2024. About 43% of single-family homes have rooftop solar.
      • Utility-scale solar: Projects like Hoohana Solar I (52 MW with 208 MWh storage) and Kupono Solar (42 MW with 168 MWh storage) came online or are commissioning in 2024–2025.
    • Wind Power: Contributes 19.1% of renewable electricity (626 GWh in 2022). Key projects include Kawailoa Wind (69 MW) and Na Pua Makani (24 MW).
    • Geothermal: Significant on Hawaii Island, with Puna Geothermal Venture recovering post-2018 eruption, contributing to renewable growth. Hawaii ranks third among U.S. states for geothermal generation.
    • Biomass/Biofuels: Includes facilities like the 10 MW Honolulu International Airport Emergency Power Facility, 6.7 MW Green Energy Agricultural Biomass-to-Energy Facility, and 6.6 MW Honua Power Project (waste-to-energy).
    • Hydroelectricity: Minor contributor, with Kauai’s grid using 17.9% hydro in 2020.
    • Renewable Portfolio Standard (RPS): Hawaiian Electric reported a 36% RPS in 2024 (up from 33% in 2023), based on generation, with a peak of 71.6% on August 23, 2024. Under the older RPS calculation (sales-based), 2024 would have been 45%. The state aims for 40% by 2030, and Hawaiian Electric is on track to exceed this early.
  • Fossil Fuels: Approximately 64% of electricity generation in 2024, down from 67% petroleum-based in 2023.
    • Petroleum (Oil): The dominant fossil fuel, accounting for nearly 80% of electricity production in early 2024, though this share is declining as renewables grow. Key oil-fired plants include Kahe (650 MW), Waiau (402 MW), and Campbell Industrial Park (130 MW).
    • Coal: No longer a significant contributor since the 180 MW AES coal plant on Oahu was decommissioned in September 2022.
    • Hawaii’s grid is described as the “dirtiest” in the U.S. due to its high oil reliance, with petroleum-fired plants supplying about three-fourths of electricity historically.
  • Other Notes:
    • Kauai Island Utility Cooperative (KIUC), serving Kauai, achieved a 69.5% RPS in 2022, with 62.5% solar, 17.9% hydro, and 19.6% biomass, and is targeting 80% by the mid-2020s with a solar-pumped hydro project.
    • Battery Storage: Critical for renewable integration, with 512 MWh of storage in non-firm capacity and 565 MWh standalone storage (e.g., Kapolei Energy Storage, 185 MW/565 MWh). 78% of new rooftop solar installations include batteries.
    • Customer-sited Renewables: 662 MW of distributed energy resources, primarily rooftop solar, significantly boost renewable penetration.
Total Energy Consumption Mix
While electricity generation is a key focus, Hawaii’s broader energy consumption (including transportation, industrial, and residential sectors) is heavily petroleum-dependent:
  • Petroleum: Accounts for ~80% of total energy consumption, the highest share in the U.S., driven by:
    • Transportation: ~53% of energy use, mostly jet fuel for aviation and gasoline/diesel for ground transport. Only about one-third of imported oil is used for electricity, with the rest split between jet fuel and transportation fuels.
    • Electric Power Sector: Consumes ~one-fifth of petroleum.
  • Coal: Negligible since 2022, previously 5.6% in 2016.
  • Renewables: ~11.2% in 2016, growing with solar, wind, and biofuels, though still a small share of total energy due to transportation’s dominance.
  • Natural Gas: Minimal, with Hawaii having the lowest natural gas consumption in the U.S. A synthetic natural gas plant on Oahu produces small amounts.
Key Trends and Projections for 2025
  • Renewable Growth:
    • Four new solar-plus-storage projects (e.g., Hoohana Solar I, Waiawa Phase 2 Solar) are expected to come online in 2025, pushing the RPS toward 40% ahead of the 2030 goal.
    • Continued rooftop solar adoption (projected to exceed 1,186 MW by 2030) and battery storage expansion will reduce fossil fuel reliance.
    • Kauai’s solar-pumped hydro project could push its RPS to 80% by the mid-2020s.
  • Fossil Fuel Reduction: The phase-out of coal and declining oil use (from 67% of electricity in 2023 to ~64% in 2024) reflect progress, though oil remains critical due to transportation and grid reliability needs.
  • Electrification: Efforts to electrify transportation (e.g., electric vehicles, potential hydrogen-powered interisland flights) aim to reduce petroleum use, though challenges remain due to infrastructure and land constraints.
  • Grid Challenges: Hawaii’s six standalone grids face reliability risks as renewables grow. Smart inverters, demand response, and microgrid development (e.g., Hawaiian Electric’s hybrid microgrid map) are addressing stability.
  • Policy Support:
    • State laws mandate 100% renewable electricity by 2045, with interim targets of 40% by 2030. Governor Josh Green’s 2025 Executive Order reinforces this commitment.
    • Incentives like solar water heater mandates, photovoltaic rebates, and biofuel land leases support renewable adoption.
Summary
  • Electricity Mix (2024, projected 2025):
    • Renewables: ~36% (solar ~19%, wind ~7%, geothermal, biomass, hydro ~10% combined).
    • Fossil Fuels: ~64% (oil ~60–64%, coal 0%).
    • RPS expected to approach 40% in 2025 with new solar/storage projects.
  • Total Energy Consumption:
    • Petroleum: ~80% (transportation 53%, electricity ~20%).
    • Renewables: ~11–15%, growing slowly due to transportation dominance.
    • Coal/Natural Gas: Negligible.
  • Key Drivers: High oil dependence, rapid solar adoption, and policy mandates for 100% renewable electricity by 2045.
  • Challenges: Grid stability, land scarcity, and transportation decarbonization.

Hawaii plans a vacation tax hike to fund climate change programs, including beach replenishment and hurricane prep, while boosting state revenue.

​Planning a vacation in Hawaii? Might be better to make it sooner rather than later, as local lawmakers are ready to hike a tax imposed on travelers staying in hotels, vacation rentals, and other short-term accommodations. [emphasis, links added]

AP reports the first-of-its-kind impost will earmark the funding boost for programs to cope with “climate change,” with the politicians responsible pointing to the wildfires that devastated parts of Hawaii in 2023 as evidence that something must be done.

State leaders highlight projects like replenishing sand on eroding beaches, helping homeowners install hurricane clips on their roofs, and removing invasive grasses as a starting point.

The AP report notes:

A bill scheduled for House and Senate votes on Wednesday would add an additional 0.75% to the daily room rate tax starting Jan. 1.

It’s all but certain to pass given Democrats hold supermajorities in both chambers and party leaders have agreed on the measure. Gov. Josh Green has said he would sign it into law.

Officials estimate the increase would generate $100 million in new revenue annually.

“We had a $13 billion tragedy in Maui, and we lost 102 people. These kinds of dollars will help us prevent that next disaster,” Green said in an interview per the AP report.

Gov. Green said Hawaii was the first state in the nation to do something along these lines, a move he described as an unabashed “first-ever green fee” on his X account:

Andrey Yushkov, a senior policy analyst at the Tax Foundation, a Washington, D.C.-based nonprofit organization, said he was unaware of any other state isolating tax revenue specifically for environmental protection.

The AP report goes on to note the increase will add to what is already a relatively large duty on those visiting for short-term holiday stays.

The state’s existing 10.25 percent tax on daily room rates would climb to 11 percent. In addition, Hawaii’s counties each add their own three percent surcharge, and the state and counties impose a combined 4.712 percent general excise tax on goods and services, including hotel rooms.

Together, that will make for a tax rate of nearly 19 percent, effectively making Hawaii vacationers “pay to play.”


Top photo by Rebecca Elliott on Unsplash

Read rest at Breitbart

The post Pay To Play: Hawaii Proposes ‘Vacation’ Tax Hike To Fund Climate Change Projects appeared first on Energy News Beat.

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