National Fuel Quality Standards Regulation Impact Statement 1 ...

direct injection. It is claimed that direct injection technology is capable of improving fuel
consumption by about 10%. Improved fuel quality in respect of other parameters would
also promote optimal engine performance, thereby contributing to better fuel efficiencies.
Legislated fuel quality enhancements would provide the certainty required for the
deployment of advanced engine and vehicle technologies by automotive manufacturers
and its uptake by consumers.
In the case of emissions changes from refinery operations, an assessment of incremental
refinery emissions suggested increased greenhouse emissions associated with the
production of improved fuel quality. Increased energy consumption will result from
direct fuel burning in process furnaces, carbon rejection to make hydrogen and by remote
electricity generation. Although emissions by refiners are expected to increase (around
2.1 million tonnes per annum CO2 equivalent) in association with the production of
improved fuel quality, these are expected to be offset by lower emissions in road
transport. Lower emissions are expected to continue over the longer term beyond 2010.
5.5 IDENTIFICATION OF AFFECTED PARTIES
The parties that will be affected by the introduction of Commonwealth legislation
regulating fuel quality standards are:
* state/territory government agencies; * refining industry; * fuel importers and
distributors; * fuel retailers;
* automotive industry; and * consumers.
An assessment of the potential impact on each party is provided below, based on the fuel
specifications proposed for discussion by the Commonwealth in Setting National Fuel
Quality Standards Paper 2: Proposed Standards for Fuel Parameters. The actual impact
on each of the parties will depend on the final set of fuel standards specified in the
regulations under the proposed legislation. A summary of the impacts is provided in
Appendix 3.
5.5.1 IMPACT ON STATE/TERRITORY GOVERNMENT AGENCIES
Jurisdictions have indicated in principle support towards a national approach to fuel
quality. A key concern for State and Territory Government agencies is the proposal that
Commonwealth legislation for national fuel quality standards will override State-specific
legislation on fuel quality. As outlined under section 4.3, Western Australia, Queensland
and South Australia are implementing their own fuel quality legislation.
Some States have indicated that they do not want to see a worse environmental outcome
in their airsheds as a result of Commonwealth standards that are less stringent than those
they have already imposed. Western Australia, for example, has regulated a level of 1%
benzene from 2001, whereas the Commonwealth has proposed a level of 3% be
introduced in 2002 and then 2% in 2005. However, levels of benzene in ambient air are
generally not an issue in Australia where levels are below the limit recommended by the
World Health Organisation ie 5 ppb.