The New South Wales Environmental Protection Authority (NSW EPA) recently approached ACAPMA seeking comment on a proposal to remove the current exemption of diesel from the Australian Dangerous Goods (ADG) Code.

It is understood that NSW EPA is seeking the reclassification owing to the significant environmental damage that often arises from the spillage of diesel from fuel tanker accidents (the Australian Dangerous Goods Code makes provision for a product to be declared a ‘dangerous good’ due to it being deemed to be an environmentally hazardous substance).

As many readers would be aware, diesel is currently exempted from the Australian Dangerous Goods (ADG) code on the basis that the fuel is combustible only – as opposed to being both combustible and flammable.

This exemption means that the current national regulations for the on-road transportation, bulk storage and the retail of diesel fuels are less onerous than those for petroleum fuels.

ACAPMA understands that the process for any future removal of the exemption involves the NSW EPA first preparing a business case for the reclassification. This business case then forms part of an application to the National Transport Commission (NTC) -who administer the Australian Dangerous Goods Code – for the conduct of a national consultative process on the proposed change.

Once the application is received and approved, the NTC must undertake a Regulatory Impact Assessment (RIS) to determine the likely costs and benefits of any future change in the existing Regulations.

“At first glance, the likely impact of the proposed changes on our industry appeared to be relatively minor”, said ACAPMA CEO Mark McKenzie.

Preliminary feedback received from a selection of member business solely involved in the Australian diesel market, however, revealed that the implications arising from the change could actually be very significant for these businesses and their customers.

“The reclassification of diesel as a Dangerous Good means that diesel-only businesses would likely face increased capital and recurrent costs in a variety of areas – ranging from driver licencing and business insurance premiums to bulk tanker and storage infrastructure modifications”, said Mark.

“There may also be flow-on effects for fuel retailers in respect of the storage and retail of diesel fuel under related State/Territory regulations” said Mark.

In short, the early industry feedback suggests that any change to the current treatment of diesel under the Dangerous Goods Code will require careful consideration of both the risk of potential future environmental damage and the likely economic costs to industry (and the community at large).

“It may also be worth our industry entering into discussions with relevant State/Territory authorities to examine whether there are better alternatives to the current issue than the solution being proposed by the NSW EPA”, said Mark.

ACAPMA is currently preparing comprehensive advice for the NSW EPA in respect of their request for input and is urgently seeking feedback from industry to assist with this process.

“We are particularly interested in hearing from those businesses that are involved solely in diesel distribution, diesel wholesale and/or diesel retail in regional Australia – as these are the businesses that appear most likely to be negatively impacted by this proposal”, said Mark.

“Our industry will never oppose laws targeting environmental protection, where such laws are clearly justified”, said Mark

“That said, it is important that these types of environmental decisions are carefully weighed against the likely adverse economic consequences for industry and the community at large”, Mark continued.

Any member that is interested in providing input on this matter should contact ACAPMA on 1300 160 270 or send an email to Mark McKenzie directly, via markm@acapma.com.au.