The Biofuels Association of Australia (BAA) has this week submitted its response to the proposed Queensland ethanol mandate.
The BAA is broadly supportive of a mandate on biofuels in Queensland. We believe it is important that the industry grows in a sustainable manner and that the targets set are achievable. For these reasons, we are supportive of the proposal to set the initial ethanol mandate level at 3% of the RULP volume in 2016, and a biodiesel mandate of 0.5% in relation to the total volume of biodiesel sold.
The BAA believes that the adoption of a mandated ethanol and biodiesel volume in fuel will assist the state to:
- Leverage Queensland’s agricultural base to create value adding options and provide a diversified income for farmers
- Reduce GHG emissions
- Improve air quality by using oxygenated fuels resulting in more complete combustion, thereby lowering state health cost expenditure
- Take some important first steps in improving Queensland’s fuel security by developing alternative fuels in the wake of the announcements of oil refining closures
- Position Queensland as a global player at the forefront of an emerging advanced biofuel industry and position it to take advantage of the 1.2billion prize outlined by Deloitte
- Take a leadership position in advocating for clean energy and avoid what appears to be an ever growing generational climate change bill.
Countries all over the world have recognized that mandating cleaner fuel alternatives is a critical policy tool to encourage development and consumer take-up of ethanol and its renewable stablemates.
Gavin Hughes, CEO of the BAA, said “The fuel market cannot be considered to be a free market, because the flow of fuel to the consumer is controlled in the main by the major oil companies.
“As the major oil companies are not involved in the manufacture of biofuels, they have no commercial incentive to offer cleaner biofuels products to the market because they do not derive profits from the whole value chain, as they do when selling petroleum. Simply asking oil companies to sell biofuels is akin to asking a tobacconist to sell a Nicabate or Nicorette type product.”
The BAA envisages that the mandated level of ethanol in Queensland would increase over time in conjunction with growth in production capacity in the state.
“A 3% RULP mandate will provide consumers with genuine choice as the product will need to be available at many more retail service stations in Queensland,” Mr Hughes said.
“Currently, we estimate that 95% of the vehicle fleet in Queensland is E10 compatible. By the time we reach 2020, it is likely that 98% of the Queensland car fleet that currently would uses RULP will be E10 capable, allowing for a full transition to E10 as a base grade of fuel.”
You can read the BAA’s submission to the Queensland government’s ethanol mandate discussion paper here.