Queensland motorists will pay millions more for fuel each year after the introduction of the State Government’s ethanol mandate, consumer advocates warn.

From January 1, large service stations will have to ensure that 3 per cent of regular unleaded petrol and ethanol-blended fuel sold is bio-based, such as E10. The minimum ­target will rise to 4 per cent in 2018.

A report from the Australian Competition and Consumer Commission this week found that a similar mandate in force in NSW since 2007 had made “a significant impact” in reducing consumer choice, forcing drivers to buy more ­expensive premium 95 or 98 unleaded petrol.

“The analysis found that Sydney motorists may have spent around $75 million to $85 million more on petrol as a result of the ethanol mandate,” it said.

ACCC chairman Rod Sims said: “It’s hard to believe we will not see a fair bit of that in Queensland.”

The report noted regulatory costs related to the incoming mandate were already keeping fuel ­prices high in Queensland.

Brisbane already has higher petrol prices than Sydney, Melbourne, Adelaide and Perth. Geoff Trotter, general manager of price-monitoring agency Fueltrac, said the ethanol mandate would bring even more pain at the pumps.

“If Queensland thinks this won’t happen here, well, let’s not kid ourselves,” he said.

Analysis for the Independent Pricing and Regulatory Tribunal by University of Texas researcher Michael Noel found that E10 was rejected “en masse” by NSW motorists.

He put the additional consumer cost at $300 million for the first five years.

RACQ spokeswoman Renee Smith said they expected the impact here would be less because Queensland’s target was half that of NSW.

But she added: “We’ll be monitoring it closely to ensure there is still choice for Queensland motorists at the bowser.”

Extracted from the Daily Telegraph.