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GEA calls for fuel diversity in energy security initiative

ATA sees 1 cent fuel import impost as well worth price of self-reliance


While the manufacturing sector hails the federal government’s pandemic-recovery energy initiative, wrinkles in the policy have raised issues of focus.

Gas fuels Industry representative body Gas Energy Australia (GEA) is happy with the idea of fuel self-reliance but is less keen on the lack of transport fuel diversification foreseen in the initiative’s focus.

GEA believes the lower excise on these fuels and greater diversity in fuel sources would do more for Australia’s fuel security than relying solely on increasing reserves of oil-based fuels.

Read about the domestic  fuel security reform announcement, here

“Self-reliance is one of the most critically important issues to emerge during the Covid-19 crisis, and our recovery is a timely opportunity to revisit this and make an even more affordable contribution to fuel security through fuel diversification,” GEA CEO John Griffiths says.

“While we support the government’s move to increase fuel security, more can be achieved if we focus on increasing the use of gas fuels to power our manufacturing, transportation and industrial sectors.

“Self-reliance should involve making a modest investment in Australia’s lower-emitting, lower-polluting gas fuel supplies, which is in line with the government’s Energy Technology Investment Roadmap and the pressing need to create home-grown jobs, not just paying more scarce taxpayer funds to maintain overseas jobs from imported fuel.

“There are more Australian jobs in Australian-produced gas fuels than in importing oil-based fuels, regardless of whether they are refined overseas or here in Australia.

“Gas fuels tick the box across the board for Australia’s transport, mining, manufacturing and domestic use sectors – they are cleaner, greener, abundant and comparatively affordable compared to other fuel types.

“Australian gas fuels are the only currently viable alternative to imported diesel for many heavy industry and transport needs and even a small shift from oil-based fuels to gas fuels is a win-win scenario – reducing dependence on foreign fuel imports and cutting running costs for heavy vehicle and marine transport operators.

“The best way to help with this shift is to adjust the excise on gas fuels.

“In 2011, both sides of politics promised to keep the excise on gas fuels at 50 per cent of that on diesel, but what we’ve seen instead is successive governments inadvertently taxing local fuels out of existence.

“Reducing excise to the level previously committed to would be of limited cost to the budget, more cost effective than maintaining larger oil reserves and help support and create Australian jobs.

“Replacing just 10 per cent of imported diesel with gas fuels would also improve Australia’s balance of payments by around $1.5 billion a year and reduce our CO2 emissions by up to 597,000 tonnes.

“This potential is demonstrated by 16 trucks running across Australia with engines modified with recently developed Australian heavy-duty dual fuel systems which substitute LPG for diesel by 23 per cent.”

The issue of a 1 cent per litre surcharge on imported fuel the new strategy puts forward is of concern for the Automobile Association of Australia, which wants the impost spread beyond motorists.

But the Australian Trucking Association (ATA) sees it as a small price to pay for the insurance self-reliance will provide in destabilised and uncertain times.

“The ATA considers that the package would have a very small impact on fuel prices, and an even smaller impact when you compare it to the cost to our industry and society of a national fuel shortage,” chief of staff and national manager, policy Bill McKinley tells ATN.

“We will be involved in the government consultations on the design of the package, and will do everything we can to make sure it delivers the fuel security we need at the lowest possible cost.”

The federal government says it will work with industry over the next six months on the legislative and regulatory design of the package.


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