State Representatives David Marshall (R-LD7) and Ralph Heap (R-LD10) introduced House Bill 2269, a measure to eliminate the state sales tax on electric and gas utility bills for Arizona residents and businesses.
The proposed legislation would suspend the state’s 5.6% sales tax on electricity and natural gas utilities until either $2.3 billion in cumulative tax relief has been provided to Arizonans or December 31, 2046—whichever comes first.
Once the $2.3 billion threshold is reached, the Legislature would then decide whether to extend, modify, or reinstate the exemption.
“People are getting crushed by rising costs, making it harder to live and do business in our state,” said Representative Marshall. “Almost everyone pays a local utility for electricity or gas. Eliminating the tax on this expense represents one of the most immediate and direct ways we can help working families keep costs affordable.”
The 5.6% tax on electricity and gas quietly adds up on monthly bills, leaving the average household paying more than $100 a year in utility tax—funds that could instead support necessities like groceries, housing, and childcare.
Representative Marshall highlighted a structural concern with the current system: “Taxing electric and gas utilities creates a perverse incentive for the government to support increased rate hikes. If rates go up, the state gets more money. That leads some to view rate increases as a source of potential funds for their liberal pet projects. That’s not right; it’s time to put the people of Arizona first.”
“While we’re unsure of any legal way to get ratepayers’ money back, there are things we can do to help reduce costs today,” Marshall continued. “In my opinion, the next best thing we can do is try to provide justice by eliminating taxes on electric and gas utilities moving forward. That’s why, over the next 20 years, we are proposing no state tax on utilities until every penny of the $2.3 billion that was wrongfully extracted from the Arizona ratepayer is metaphorically ‘paid back’ to hardworking families.”
He added, “This bill will save most residents between $100 and $120 per year, on average. Once the $2.3 billion threshold has been met, then the state can determine what it wants to do with the exemption from there, including whether to reassess the tax or extend the exemption even further.”
Representative Heap pointed to actions taken by the Arizona Corporation Commission as the basis for the bill’s $2.3 billion figure: “In 2006, Arizona Corporation Commissioner Kris Mayes catered to outside special interests and adopted expensive renewable energy surcharges that cost ratepayers more than $2.3 billion over the last 20 years. This special interest slush fund also led to foreign-owned boondoggles like the Solana Generating Station, which Kris Mayes personally supported, and which cost ratepayers more than three times the above-market rate of power.”
“While repealing these mandates may help to prevent new costs,” Heap added, “it will do nothing to compensate customers for the unjust surcharges that Kris Mayes forced ratepayers to pay over the last 20 years.”
Ethan Faverino is a reporter for AZ Free News. You can send him news tips using this link.
California is poised to lose a significant portion of its oil refining capacity by the end of 2026, as Valero announced the closure of its Benicia refinery—its second largest in the state—just months after Phillips 66 declared plans to shut down its Los Angeles facility. Together, the closures will eliminate roughly 17.4% of California’s total refining output, a shift expected to ripple beyond state borders, potentially triggering gasoline price spikes and supply disruptions in neighboring Arizona and Nevada.
These developments come on the heels of new state regulations introduced under Governor Gavin Newsom, which impose strict oversight on refinery operations. The rules limit when refineries can conduct maintenance, mandate increased inventory storage, and aim to curb perceived “price manipulation.” However, the energy industry and regional leaders argue these measures are accelerating refinery shutdowns and undermining fuel stability across the Southwest.
California operates as an “energy island,” with limited ability to import refined fuel from other U.S. regions due to the federal Jones Act, which restricts domestic shipping to U.S.-built and -crewed vessels. With U.S. shipbuilding capacity far behind that of countries like China, domestic maritime transport remains scarce and costly. As a result, California will increasingly rely on foreign tanker ships for fuel imports—an emissions-intensive, volatile, and expensive solution.
Governor Newsom claims California’s high gas prices are due to refinery “price gouging,” despite his own administration’s lack of evidence. His regulatory push has faced bipartisan opposition, including a joint letter from Arizona Governor Katie Hobbs and Nevada Governor Joe Lombardo warning that new refinery laws could lead to “higher costs for consumers” in all three states. Chevron echoed this concern, stating that the regulations would increase both the likelihood and duration of fuel shortages, while permanently raising consumer prices.
Refineries in California are already operating at or near full capacity. With no new facilities planned—especially as the state pushes to ban new gas-powered car sales by 2035—any closure tightens supply margins. The upcoming shutdowns will reduce daily refining capacity to 1.34 million barrels, well below the state’s consumption level of 1.8 million barrels per day, necessitating a shortfall of over 140 million barrels per year.
Due to California’s requirement for a specialized gasoline blend, few out-of-state refiners can meet demand, further narrowing supply options. These vulnerabilities were recently exposed when the temporary shutdown of the Martinez refinery sent gas prices soaring across the region, including in Arizona and Nevada.
With California gas prices already the nation’s highest—averaging $4.86 per gallon—experts warn that future supply shocks could bring about even more dramatic volatility and potential fuel shortages across the Southwest.
Jonathan Eberle is a reporter for AZ Free News. You can send him news tips using this link.
Things are just not going well for the leftwing activist groups, billionaire-funded NGOs and trial lawyer firms who have recruited a growing number of state and local government entities to sue U.S. oil and gas companies involving specious claims for damages caused by climate change. In recent months, the lawfare campaign, coordinated mainly from the offices of one San Francisco-based firm, has suffered a series of adverse judicial decisions in what appears to be a rising consensus in the nation’s courts.
Just two weeks after suffering a major setback in a decision involving Anne Arundel County, Maryland, the pushers and funders of this lawfare campaign were tossed out in a case targeting ExxonMobil, Chevron and additional defendants in New Jersey. There, Superior Court Judge Douglas H. Hurd dismissed the Garden State’s lawsuit with prejudice based on the same federal primacy arguments which prevailed in recent decisions in New York City and Baltimore, as well as in the Anne Arundel case.
In seeking damages, New Jersey adopted similar tactics adopted in the other cases that make up this lawfare campaign, claiming they’ve been harmed by “climate change” impacts allegedly caused by the emissions by oil companies, but attempting to couch the damages as violations of state laws unrelated to air pollution. But Hurd was having none of it.
“Despite the artful pleading by the Plaintiffs in this case,” the judge says in his decision, “this court finds that Plaintiffs’ complaint, even under the most indulgent reading, is entirely about addressing the injuries of global climate change and seeking damages for such alleged injuries.”
The problem for the states, cities and counties who have signed up for this lawfare campaign in the hopes of grabbing some big bucks from Big Oil is that their arguments inevitably amount to a local effort to de facto regulate air quality, an area of regulation in which the federal government has always asserted its primacy. There’s a very good reason for this: If every city, county and state in America were allowed to regulate air quality, the economy would soon grind to a halt as it becomes impossible to do business in this country.
Like the judges in the other cases decided thus far, Hurd conceded to that reality in dismissing the New Jersey case, saying, “As Defendants state in their moving brief, ‘the federal system does not permit a State to apply its laws to claims seeking redress for injuries allegedly caused by interstate or worldwide emissions,’” adding, “In conclusion, only federal law can govern Plaintiffs’ interstate and international emissions claims because ‘the basic scheme of the Constitution so demands.’”
The decision in the New Jersey case no doubt comes as a real disappointment for the billionaire-funded foundations and NGOs who spent years pushing for the state attorney general’s office to bring a case. In 2023, Energy Policy Advocates obtained emails detailing tactics employed by the Rockefeller-funded Center for Climate Integrity (CCI) to convince various cities and counties in the state to sign onto the lawfare campaign.
Those emails revealed close coordination between CCI and New Jersey officials, even to the extent of CCI funding an “Accountability University” to educate lawfare participants about the best tactics and talking points to deploy in their big money grab efforts.
CCI even offered to “ghost write” opinion pieces for public officials and “serve as an extra set of hands,” adding, “…there are absolutely no legal obligations. Since we are a 501 c3, there is no pledge or legal sign on’ required. Rather, we view ourselves as an extra set of hands to help public officials…”
So, what’s the point of all this, you might ask? Well, the point is that when you see one of these lawsuits brought by a city, county or state government, just know that none of this is happening organically. Also know that this big money grab costs these companies millions to defend themselves, and we all end up paying for it at the gas pump and in our home utility bills. Maybe it’s time we all demand these billionaires and trial lawyers find more productive ways to spend their time and money.
David Blackmon is a contributor to The Daily Caller News Foundation, an energy writer, and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
During his campaign and since taking office, President Donald Trump often repeated his desire to bring back the same “drill, baby, drill” oil and gas agenda that characterized his first term in office.
But that term began 8 long years ago and much has changed in the domestic oil business since then. Current market realities are likely to mitigate the industry’s response to Trump’s easing of the Biden administration’s efforts to restrict its activities.
Trump’s second term begins as the upstream segment of the industry has enjoyed three years of strong profitability and overall production growth by employing a strategy of capital discipline, technology deployment and the capture of economies of scale in the nation’s big shale play areas. Companies like, say, ExxonMobil and Oxy and their peers are unlikely to respond to the easing of government regulations by discarding these strategies that have brought such financial success in favor of moving into a new drilling boom.
This bias in favor of maintenance of the status quo is especially likely given that the big shale plays in the Permian Basin, Eagle Ford Shale, Bakken Shale, Haynesville and the Marcellus/Utica region have all advanced into the long-term development phases of the natural life cycle typical of every oil and gas resource play over the past 175 years. Absent the discovery of major new shale or other types of oil-or-natural gas-bearing formations, a new drilling boom seems quite unlikely under any circumstances.
One market factor that could result in a somewhat higher active rig count would be a sudden rise in crude oil prices, if it appears likely to last for a long period of time. Companies like Exxon, Chevron, Oxy and Diamondback Energy certainly have the capability to quickly activate a significant number of additional rigs to take advantage of long-term higher prices.
But crude prices are set on a global market, and that market has appeared over-supplied in recent months with little reason to believe the supply/demand equation will change significantly in the near future. Indeed, the OPEC+ cartel has been forced to postpone planned production increases several times over the past 12 months as an over-supplied market has caused prices to hover well below the group’s target price.
But it is wrong to think the domestic oil industry will not respond in any way to Trump’s efforts to remove Biden’s artificial roadblocks to energy progress. Trump’s efforts to speed up permitting for energy projects of all kinds are likely to result in a significant build-out of much-needed new natural gas pipeline capacity, natural gas power generation plants and new LNG export terminals and supporting infrastructure.
Instead of another four years of “drill, baby, drill,” the Trump efforts to speed energy development seem certain to result in four years of a “build, baby, build” boom.
Indeed, the industry is already responding in a big way in the LNG export sector of the business. During Trump’s first week in office, LNG exporter Venture Global launched what is the largest energy IPO by value in U.S. history, going public with a total market cap of $65 billion.
With five separate export projects currently in various stages of development, all in South Louisiana, Venture Global plans to become a major player in one of America’s major growth industries in the coming years. Trump’s Day 1 reversal of Biden’s senseless permitting pause on LNG infrastructure is likely to kick off a number of additional LNG projects by other operators.
The Trump effect took hold even before he took office when the Alaska Gasline Development Corporation entered into an exclusive agreement in early January with developer Glenfarne to advance the $44 billion Alaska LNG project. The aim is to start to deliver gas in 2031, with LNG exports following shortly thereafter.
America’s oil and gas industry has demonstrated it can consistently grow overall production to new records even with a falling rig count in recent years. Now it must grow its related infrastructure to account for the rising production.
That’s why Trump’s “drill, baby, drill” mantra is likely to transform into “build, baby, build” in the months and years to come.
David Blackmon is a contributor to The Daily Caller News Foundation, an energy writer, and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.
During a city council meeting this week, Mayor John Giles and the Mesa City Council voted to approve across-the-board increases in the city’s utility rates and fees covering solid waste removal, electricity, gas, water, and wastewater. Over two-dozen Mesa citizens spoke during the meeting, which stretched over two-hours. Mesa, lacking a primary property tax, derives much of its funding from utility rates and fees.
The city is facing increases in electric rates of up to 39% for Winter Tier 2 usage charges for residents and a $2.75 per month service charge increase according to the council report. Non-residential users will face increases from 2-6 percent. Solid waste residential barrel rates will increase 5.5%, with commercial roll-off rates jumping 6.5%. Gas rates are increasing 6-15% for residences and from 9-25% for non-residential users. Water rates are increasing 4-9% for residents, 5.5% for non-residential, 8.5% for commercial users, and 19.5% for large commercial or industrial users. Finally wastewater service and usage components charges will increase by 7.5% for residents and 8.5% for non-residential.
City staffers told The Mesa Tribune that the typical residential bill for water, wastewater, and solid waste will see an increase of about $5.60, from the current average of $100.21 to $105.81
As reported by the Tribune, Giles answered criticism at a meeting in late November telling the frustrated residents, “This proposed water-rate increase of less than 5% in Mesa is dramatically less than you see in every other community,” said Giles, zeroing in on the water utility increase.
“Cities around the Valley are increasing water 25%, talking about increasing wastewater charges 95%. We’re not doing anything remotely like that in the City of Mesa.“
“So if you’re upset about the increasing price of water, I’m with you. But if you want to vent those feelings, probably every other city council in the state would be a more appropriate place to do that because the increases are less than what you’re seeing in other cities.”
Kevin Medema, a Mesa resident who led the organization of a petition opposing the utility increases reportedly signed by 2,000 people, stressed, “We have citizens that are hurting financially. The city shoots for that 20% reserve (in the utility accounts). Well, you know a lot of residents won’t have that in themselves. So, please consider voting ‘no.’’’
Medema suggested that residents have offered to help the city find ways to reduce spending.
During the November 18th meeting, one Mesa resident, Lynda Patrick-Hayes poignantly called upon the council to “entertain the idea of cutting the utility rates and encourage the city manager to eliminate government waste. The City of Mesa has no revenue problems. It has a spending problem.”
Citing the city’s reliance on utility charges and sales tax due to lacking a property tax, Giles told the citizens, “There’s not an apples-to-apples comparison because the City of Mesa has a different model. We’re going to use utilities to help subsidize city services.”
Multiple attempts to reinstate a primary property tax, eliminated in 1945, have failed over the years.
“Now if you don’t like that model…the answer is not to come to the City of Mesa and say, ‘We don’t want you to raise utilities because that’s denying the reality of math.’”
Responding to calls to reduce city spending, Giles told the gathered objectors, “What your proposal is, you’re saying, ‘I want to dramatically cut spending on public safety in the City of Mesa.’ That’s what you’re asking us to do.”
Republican State Representative Barbara Parker spoke on behalf of her constituents in the area and told the council, “They call me when they lose their homes. They call the state when they can’t afford their insurance. And on behalf of them, I am telling you they are hurting and even one dollar makes a huge difference.”
Parker castigated the mayor and council for suggesting the city cut public safety spending, “The fact that we use the threat of fear and emotion that we are going to cut police and fire is so disingenuous and inappropriate. And to all the gentlemen and women in uniform tonight: I am one of you and I have trained many of the firefighters, and I want you to know we have your backs. And we need to elect people who will fund you first and then find funding for everything else. We are never going to cut funding to police and fire. That is always a tactic. It’s disingenuous, it is inappropriate, it lacks accountability, it is intellectually dishonest, and they are not pawns and you deserve better. Don’t let them use you as a pawn police and fire. It’s inappropriate to have a bond and then immediately after that election to suddenly have a tax increase or a rate payers increase.”
She concluded, “One of the things I was able to communicate to the legislature as a member of the Appropriations Committee is that: EVERY. SINGLE. DOLLAR. IS. SACRED. Every single penny is sacred. And when I’ve asked the citizens would they rather have one more penny in their pocket than have it go to waste or redundancies or excesses. Absolutely they say yes. I hope you’ll have the courage to do the right thing tonight. I can tell you on behalf of the state: we were able to cut budget, balance our budget, give money back to the taxpayers and fund every single program. And if the state of Arizona can do it, Mesa can do it better.”
The rate increases were passed by the city council unanimously with Giles stating, “I know all of that is not appreciated by this crowd to the extent that we’d like it to be, but it’s the facts. For those reasons I am compelled by math and the reality of the situation to support this increase.”
