There has been a lot of misinformation about Amendment 58.

Amendment 58 will end an outdated tax break for oil and gas producers, and it will use the revenues for important purposes -- the most significant being scholarships for low- and middle-income Coloradans attending state colleges and universities.

The opponents say that an increase in the severance tax rate will result in higher consumer prices for gasoline and natural gas. That sounds like the energy companies are standing up for little guys -the consumers.

But the opponents are using consumer prices as a smokescreen to hide their bottom-line opposition to Amendment 58. Higher prices would mean that energy companies had passed along increased costs to consumers. If they could do that, why would they be fighting so hard against Amendment 58?

The truth is, the energy companies can't pass along the costs to consumers. The amendment will add very slightly to production costs, and thus to the cost of doing business.

That's why energy companies have pledged to spend millions to fight the amendment. Sadly, it's not for you, the consumer.

It's easy to use scare tactics concerning energy prices, but the pricing mechanism for natural gas shows that utilities -and therefore, customers -will see very little in higher costs due to Amendment 58 and possibly none at all.

Here's why:

Natural gas producers incur costs developing the product. The severance tax is one cost of production - and a relatively small one compared to their primary costs, such as wages and equipment. Like any business, they need to cover their costs and, hopefully, turn a profit.

The gas producers arrange to have their product piped to markets. In the case of Colorado, the pipelines reach across the state, the region and as far east as Ohio and as far west as California. At the end of the pipelines, producers from Texas, Oklahoma, Kansas, Wyoming, New Mexico and Colorado compete for customers at prices determined, not by costs, but by supply and demand in competitive national and even hemispheric markets.

Utilities - which are large buyers with significant market power - bargain for the best prices. Those prices go up or down based on supply and demand, and producers have no guarantee they will be able to recover any cost increases, whether due to changes in effective severance tax rates or any other cost of production.

The bottom line: little or no increase to utilities for their gas costs means little or no increase for utility costumers.

So who pays? The answer is that producers and their shareholders pay with slightly lower profits. That's a real cost, of course, and it explains why they are fighting so hard. But we're talking about an industry that is seeing world-record profits.

That's why oil and gas production is booming in Colorado and throughout the West (where other major producing states already have higher effective severance tax rates than Colorado).

Amendment 58 is about making sure that, as industry extracts valuable resources that cannot be replaced, some of the financial benefits stay in Colorado to help make this a better place to live.

But college scholarships would enjoy the biggest boost, and college is a critical gateway to the middle class. Amendment 58 will open that gateway a little wider for thousands more Coloradans every year. And despite the scare tactics, it will do so without hurting Colorado consumers.

Wade Buchanan is president of the Bell Policy Center and past director of both the Colorado energy office and the Colorado Department of Natural Resources