23 November 2015

THE peak industry association for petroleum distribution has called for the Baird Government “to come clean” on a decision which could raise petrol prices in regional areas by eight cents or more.

According to the Australasian Convenience Petroleum Marketers Association, the NSW Government is understood to be seriously considering options to force more NSW motorists to purchase ethanol blended fuel – including requiring all service stations to sell ethanol blended fuel and/or prohibiting the sale of regular unleaded petrol.

“These changes are being considered without any consultation with industry and despite the fact that such changes could result in regional job losses in the retail fuel industry and/or increase fuel prices for NSW motorists”, said ACAPMA CEO Mark McKenzie.

“Contrary to public perception, ethanol blended petrol (E10) cannot simply be pumped into existing tanks – in many cases, fuel retailers are required to invest in new underground storage tank and fuel pump infrastructure to accommodate the chemical properties of ethanol blended fuel,” he said.

“The cost of these changes varies according to the type of fuel infrastructure at each site, but is estimated to be as high as $900k where the underground storage tanks need to be replaced.”

Mr McKenzie said it was this sort of cost that could cripple fuel retail businesses or result in a significant increase in fuel prices for motorists.

“This action will likely push up the price of all petrol grades in some areas – particularly in regional areas – by an average eight cents per litre as these businesses seek to recover the costs of the necessary capital investment”, said Mr McKenzie.

“Consideration of any changes to the existing legislation without comprehensive industry consultation is reckless and risks job losses in regional areas and higher fuel prices for NSW motorists. We call on the Baird Government to immediately come clean and explain what is being proposed with respect to imminent changes to existing Biofuels Legislation in NSW.”

Extracted in full from The Daily Examiner.