National Fuel Quality Standards Regulation Impact Statement 1 ...

* The possibility of supplying dual grade ‘city/country’ diesel, with low sulphur diesel
supplied in the major city areas and higher sulphur diesel supplied in the country areas
for an interim period; and
* Incentives for the promotion of green fuels suitable for use in transport and switching
of vehicles to such fuels.
Commonwealth’s proposal for national fuel quality standards
As part of the consultation process for developing national fuel quality standards, the
Commonwealth held face to face meetings with stakeholders in the jurisdictions during
May and June 2000. The main objective of these meetings was to provide an opportunity
for stakeholders to discuss the proposals presented in the discussion papers and any
issues of concern relating to the proposed standards or the process for implementing
them.
The Commonwealth team consisted of representatives from Environment Australia,
Australian Greenhouse Office, Department of Industry, Science and Resources, and the
Department of Transport and Regional Services. An Interdepartmental Committee
representing other relevant Commonwealth Government departments was also consulted
during development of the Commonwealth legislation and proposed fuel quality
standards.
The main issues arising from this consultation process include:
* The proposal that Commonwealth legislation will override any inconsistent State
regulations. Western Australia, Queensland and South Australia have introduced or will
be introducing State-specific legislation where some standards, e.g. for benzene, are more
stringent than the standard proposed by the Commonwealth. They have indicated quite
strongly that they do not want to see Commonwealth standards result in a worse
environmental outcome in their jurisdictions.
* Concern has also been expressed that the timing for the introduction of fuel standards
will close some refineries which would also have implications for dependent industries,
e.g. the petrochemical industry.
* The timing of the introduction of fuel standards to facilitate the new emissions control
ADRs. The Commonwealth proposes introducing standards for technology enabling
parameters 12 months in advance of the mandated date for the new ADRs. as specified
under Measures for a Better Environment. The automotive industry has indicated that
Euro 3 vehicles will be introduced during the 12 months leading up to the mandated date.
It will, therefore, be necessary to ensure that appropriate fuel is available during this lead
up time. On the other hand, the refining industry have concerns that this cuts into time
available for the investment needed to upgrade plant and in gaining the necessary
approvals from their companies.
* In relation to timing, the refining industry has also indicated that once new diesel plant
is established to produce 50 ppm sulfur, the old plant will then be converted for 50 ppm
sulfur petrol. Therefore, the Commonwealth’s proposal for the introduction of 50 ppm