A Productivity Commission report is calling for the scrapping of a biofuel mandate in NSW and Queensland.

A RECENT Productivity Commission report in the Regulation of Australian Agriculture has called for the scrapping of biofuel mandates in NSW and Queensland. According to the Productivity Commission, a minimum of 3% of non-premium fuels sold in Queensland need to be biofuel, while in NSW the target is 6%, this includes a 0.5% and 2% target for biodiesel sales in Queensland and NSW, respectively. The mandate was introduced in Queensland in January this year.

Despite such relatively low targets, the Productivity Commission claims a biofuels mandate can adversely affect the price of fuel “and may not help the environment”. The report stated:

“Assessments of the New South Wales biofuel mandate showed that:

  • Retailers cut the supply of regular unleaded petrol to meet the biofuel sales target (hence the claim the cost of fuel is increasing as buyers are ‘forced’ to buy a ‘premium’ fuel because of an unavailability of Regular Unleaded; replaced by E10);
  • The mandate reduced consumer choice and increased the price consumers paid for petrol because they substituted to premium fuels; and
  • The mandate affected the competitive dynamic between retailers by reducing the availability of regular unleaded petrol at many retail sites (ACCC 2013b, sub. DR121; IPART 2015).”

In Australia there are only three ethanol producers, one in NSW and two in Queensland. Ethanol is blended with fuel to create biofuel. According to an Australian National Audit Office report, “improving the long‐term viability of the domestic ethanol industry, in 2014 only three domestic producers (up from two in 2002) were operating, and an expanded Australian ethanol industry based on market priced feedstock was considered unlikely to be commercially viable in the absence of the EPG rebate”.

Several key farming groups, from cotton growers to dairy farmers have demanded the biofuel mandate be dropped and the money being spent on the industry redistributed. Indeed, the Productivity Commission recommended the scrapping of the mandate by the end of 2018.

However, the Queensland Renewable Fuels Association (QRFA) has hit back at the Productivity Commission report with its managing director, Larissa Rose saying the comments made by the Productivity Commission do not represent facts.

“In making these claims the Productivity Commission has drawn flawed conclusions from poor evidence. Suggesting that agribusiness will suffer from biofuel mandates when it is a key diversification market for agriculture, is completely inaccurate.”

“In fact the opposite is true – it is the very products these (agricultural) businesses produce that are the feedstock for biofuels – creating sales, supporting business and boosting jobs,” Ms Rose said.

“This is exactly what Australian’s biofuel refineries do – support our nation’s regional economy and provide us with low carbon fuel.

“It is misleading to state that biofuel mandates raise the price of petrol.  E10 fuel is a 94RON fuel, a premium product in many respects that delivers lower emissions. The so-called higher cost is principally due to increasing -and frequently unnecessary – uptake of ‘premium’ 95 and 98 fuels. Now motorists are beginning to understand that you can get a higher octane fuel more cost-effectively with E10,” said Ms Rose.

Question: Not all car makers recommend E10 for use in their vehicles, so, do you think there should be a mandate on the volume sold, or are there alternative ways to lower the carbon footprint of cars and, should the government be supporting the ethanol industry or putting the money into electric vehicle incentives and charging stations?


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  1. You do realise this all came about because that weasel John Howard was good mates with the owner of Manildra that convinced him we need to add ethanol to fuel to prop up his business. 100% political corruption. He should be held accountable for his actions.

  2. If bio-fuels were any good they would not need to be mandatory. Having said that, anything that reduces our dependence on imported fuels has to be good. It seems to me that we are going about it the wrong way. Sell the stuff on its merits, if it really is that good. Perhaps it is time for a proper, up to date comparison in the latest model cars.

  3. Mixing ethanol with gasoline is a bad idea.
    Shelf life of 100% ethanol is: unlimited.
    Shelf life of 10% ethanol mixed gasoline is: only 3 months.
    Shelf life of gasoline is: 2 years.
    Mixing gasoline with ethanol is a bad idea. Ethanol when mixed at 10% in gasoline has a reactivity which causes the vapor pressure to increases by one point results in higher VOC and results in increased ozone pollution. Reactivity from the mix of ethanol and gasoline also results in the ethanol turning the sulfur normally found in gasoline into sulfuric acid. When water gets into E10 fuel it causes it to separate.
    With ethanol taking as much non renewable energy to produce as you get out of it, you really can’t call it renewable energy.
    The whole ethanol mandate actually does nothing to improve the energy situation.

    1. Shelf life of gasoline is 2 years, RAFLMAO, try 3 months before it turns into jelly then evaporates
      These WW 2 planes laying in the jungle for 50 yrs and then Indiana Jones comes along and fires it up, you’ve been watching too many movies

      1. FAA says the shelf life of aviation fuel is 2 years. Aviation fuel is not allowed to have any ethanol in it, by law. I have some 2 year old aviation fuel in my hanger I use it in my gas powered tug it works fine. You have be smoking something to think in 3 months it turns to jelly.

        1. In my original comment I said Gasoline turns into jelly in 3 months
          You come back with Aviation fuel, where did Aviation fuel come from in YOUR original comment? I don’t see no Aviation fuel in your comment.
          You do have supporting evidence to support you claim right?

          Gasoline has a shelf life of 3 months before it turns to jelly.
          Those movies where you see the WW 2 war planes sitting in the jungle for 50 YEARS ( no mention of 2 yrs) where the hero jumps in the plane and fires up the engine is FICTION, pretend make-believe, won’t happen because the fuel has turned to jelly or evaporated

          1. Aviation fuel has a shelf life of 2 yrs, not according to Indiana Jones, he comes across a WW2 plane and fires up the engines, how does he do that, ya bloody idiot? Gasoline has a shelf life of 2 yrs, Indiana Jones comes across a WW2 Jeep, fires up the engine and drives off, how does he do that, ya bloody idiot?

            So all these planes and Jeeps sitting in the jungles for over 50 yrs, just start instantly because all the fuels inside of these machines is just waiting for some-one to crank them over

  4. I do not believe in mandates, they can reduce choice, increase costs and make bad politicians feel good.

  5. I pulled into Forest Glen servo on the North side of the Bruce Highway in my XK8 & thought I was in the 95 octane row of pumps. When I eventually had an opportunity to fill up there was only this rubbish ethanol or 98. Who the hell uses 98 nowadays, if my XK8 can run on 95 then surely even a Lambo or Ferrari can. This is just a way for servos to make profit. I do not own an ethanol friendly car, if I put my MG, Toyota & Disco diesels into the website there is no answer. No way I am going to put a food crop into my tank, and, at around 20c a pound for sugar at the moment why should I ???

  6. keep listening to the oil companies and keep funding the Middle East there is nothing wrong with ethanol we should be using higher blends

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