Beattie calls for ethanol mandate

FORMER Queensland premier Peter Beattie has weighed into the debate about ethanol policy, arguing that it is necessary to mandate use of the alternative fuel to support the industry, which has benefited from $530 million in federal subsidies since 2003.

Mr Beattie would not comment directly on a decision by the NSW ­government to ditch plans for a ruling that ethanol account for 10 per cent of fuel sold in the state, or the Queensland government's failure to pursue his plans for 5 per cent content.

But he told The Australian Financial Review that mandates were vital in establishing ethanol as an alternative fuel. "We need to use the levers of ­government to develop these new industries and, once they're up and running and it's an even playing field, they can compete without any form of mandate," he said.

Critics of ethanol mandates argue they distort markets and increase prices for consumers. They point out that the industry has already benefited from production subsidies which the parliamentary library calculates at $530 million from 2003 to 2011.

Advocates argue the measures are necessary to force oil companies to supply the alternative fuel at petrol ­stations and that the new industry will support jobs in regional areas and shore up Australia's fuel security.