NSW Government urged to remove ethanol mandate

With NSW now the only Government in Australia supporting a mandate of ethanol content in fuel, the Australian Lot Feeders‟ Association (ALFA) calls upon it to scrap the policy indefinitely.

ALFA President Jim Cudmore stated that “every other Government in Australia has rejected or removed this ill-conceived policy due to the costs and risks outweighing any regional development, environmental and fuel security benefits”.

“Despite significant grants, subsidies, tariffs and a guaranteed demand for its product, the NSW ethanol industry is still unable to meet supply requirements for the current 4% mandate let alone the legislated stipulation for all regular unleaded petrol to be E10 from 1 July 2011”.

“ALFA has always taken an active stance in opposing ethanol mandates, and our concerns have been shared by a plethora of disparate groups who joined an alliance to advocate against their implementation”.

“With the majority of ethanol for the current NSW mandate to be derived from grain, ALFA has always been concerned that during low grain production years, the artificial and inflexible demand created by the Government mandate would inflate grain and hence food prices”.

“Grain is not only the largest single cost of production for bread, but also beef, dairy, pork, poultry and eggs.

“These sectors are happy to compete against the ethanol industry for grain on the open market, but certainly not against an industry which receives a competitive advantage through Government intervention mechanisms such as mandates”.

“ALFA has also long argued that ethanol mandates increase fuel prices, as 30% of cars, 70% of motorbikes and all marine engines are not compatible with ethanol, forcing owners to pay up to 12 cents/ litre more for premium unleaded petrol at the bowser as regular unleaded becomes less available”.

“The reduced availability of regular unleaded has become increasingly noticeable as major fuel retailers have been gradually phasing it out, with 49% less sold in NSW since the Government first mooted the ethanol mandate idea in March 2007”.

“Given increasing industry and community opposition and former US Vice President Al Gore even stating recently that „support for grain based ethanol is not good policy‟, the NSW Government should scrap its ethanol mandate once and for all”.

source: farmonline