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Ferguson won’t use carbon tax for alternative fuel support

Government won't use carbon tax revenue to build infrastructure to boost the use of natural gas as a transport fuel

By Gary Worrall | April 17, 2012

The Federal Government will not use the influx of funds from the impending carbon tax to build infrastructure to boost the use of natural gas as a transport fuel.

Federal Minister for Resources, Energy and Tourism Martin Ferguson says he will not be pushing for income from the carbon tax to build shared access refuelling stations for natural gas on major transport routes.

This is despite Australia holding an abundance of virtually pure natural gas reserves, which would also provide a positive impact on Australia’s balance of trade while reducing dependence on imported oil.

A spokesperson for Ferguson says the government would rather see market forces drive the construction of infrastructure, despite the recent track record of government intervention in other areas.

The spokesperson says the Strategic Framework for Alternative Transport Fuels, an 84 page document released in December 2011, describes the preferred methodology for increasing the uptake of cleaner fuels.

This relies on the private sector to establish Australia’s future fuel security despite the report identifying policy, legislative and regulatory barriers that are currently hindering the move to alternative fuels.

Ferguson declined to directly answer whether he saw any benefit in encouraging the use of alternative fuel. The spokesperson’s response pointed to the framework document, which, although strong on generalised statements, lacks the direct action plans necessary.

While much of the debate centres on the use of locally manufactured natural gas, which can be retailed as either compressed natural gas (CNG) or liquefied natural gas (LNG), the framework document also discusses other alternatives.

These include both biofuels and electric power, such as hybrids as well as full electric.

However, in these areas it also remains light on specific details of government action, other than to “facilitate timely development and review of fuel quality standards, standards for electric vehicles and other standards and regulations related to alternative transport fuels”.

Given government reaction times to the initial introduction of hybrid vehicles, such as when Toyota first attempted to introduce the Prius to Australia and when the Hino hybrid truck first debuted, this does not bode well for rapid responses to new technologies.

Although another of the action points is for government and industry, as well as researchers, to provide up-to-date information on alternative fuels and their production and application, virtually none of this has come from government. Instead, it has been through media interest and corporate public relations.

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See the May edition of ATN for more on the alternative fuel debate.

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