Ethanol Mandate Blamed for Stinging Motorists $143m a Year
by Sean Nicholls (Sydney Morning Herald) The controversial NSW ethanol mandate costs motorists more than $143 million a year by forcing them to purchase more expensive premium petrol, a new analysis suggests.
It also estimates Australia’s largest producer, Manildra, last year made $4.4 million extra profit thanks to the rules, which state that six per cent of all petrol sold must be ethanol.
The NSW Greens analysis mirrors methodology used by the competition watchdog in a November report that estimated in 2014-15 Sydney motorists may have spent up to $85 million more on petrol due to the mandate.
This was because some motorists who cannot or choose not to use ethanol in their vehicles are using premium unleaded due to the reduced availability of regular unleaded, the Australian Consumer and Competition Commission said.
The ACCC noted its estimate does not take account of factors such as differences in the types of vehicles owned in Sydney, motorists’ preferences or the costs or benefits of using one petrol over another.
Federal department of environment and energy figures show NSW motorists bought 44 per cent premium unleaded petrol compared to 25 per cent in other states last financial year.
This works out as NSW motorists spending an additional $143,216,592 last year due to the mandate, the Greens analysis estimates.
“The Greens will be introducing a bill to repeal the ethanol mandate as soon as parliament resumes to test whether the old parties are prepared to finally put the interests of motorists ahead of a major political donor,” he said.
A spokeswoman for NSW Fair Trading argued that the ethanol mandate increases consumer choice “by making E10 more readily available at the bowser”.
She said an increase in premium sales was not due to a reduction in the availability of regular petrol, which was available at 82.5 per cent of stations in NSW.
“The ACCC report itself notes that the rise in premium fuel sales cannot be solely attributed to the biofuel mandate,” she said. Manildra declined to comment. READ MORE
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