Environment department says it will no longer consider changes that would provide greatest health benefit

This article is more than 2 years old

This article is more than 2 years old

Moves to introduce stringent regulations for Australian fuels have been excluded from the government’s most recent consultation paper in favour of cheaper options that would result in more damage to the environment and public health.

The Ministerial Forum on Vehicle Emissions is considering changes that would reduce emissions from motor vehicles, including regulations that would improve the fuel-efficiency of new cars and limits on pollution levels in fuel.

The motoring lobby and the petroleum industry have been fighting the introduction of the strongest regulations on both fronts. This week the department of environment revealed it did not plan to continue examining the strongest options.

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The most recent paper released by the department ends further consideration of the strongest fuel standards discussed in earlier papers, introduces a new option advocated by the petroleum industry, and appears to favour an outcome that results in greater environmental harm and more premature deaths than the strongest standards.

“Option D” would align Australian fuel standards with the Worldwide Fuel Charter developed by a global committee of vehicle manufacturers.

In its draft regulation impact statement, released this week, the department said: “While Option D provides the greatest health and environmental benefits and was supported by many stakeholders, the cost-benefit analysis revealed that it is unlikely that it will deliver a net benefit to the community.”

It noted that the Australian Institute of Petroleum told the department such a proposal would shut Australia’s refining industry, leading to fuel security risks.

But according to a Senate report from 2015, about half the transport fuel used in Australia is refined overseas and, of that refined here, about 80% is refined from imported crude oil.

The new cost-benefit analysis assesses three other options, including a new one suggested by the petroleum industry.

Exposure to vehicle emissions causes a range of diseases including reduced lung function, heart disease, stroke, respiratory illnesses and some cancers.

The department’s report notes that in 2011, air pollution in Australia caused the premature death of 2,549 people – more than the national road toll from accidents – at an estimated economic cost of up to $11bn.

Current regulations, due to expire in 2019, limit the sulfur content of petrol to 150 parts per million – 15 times higher than that allowed in Europe. Sulfur in fuel contaminates vehicles’ catalytic converters, limiting their ability to reduce emissions of harmful substances.

All three options now under consideration would bring the sulfur content into alignment with European regulations at 10ppm.

In its submission to the forum, the Australian Institute of Petroleum argued that this move alone would also “fundamentally threaten the financial viability of the Australian refining industry, potentially leading to further refinery closures – adversely affecting supply diversity in the Australian market and hence Australian liquid fuel supply security”.

It proposed that the department consider introducing the limit on sulfur content but delaying it until 2027, and instituting no other changes to the status quo.

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The two other scenarios analysed would also align Australia with European standards for aromatics content. Aromatics, including benzene, can be carcinogenic, and can cause deposits in vehicle engines that increase emissions of toxic substances including particulate matter, which is also carcinogenic.

Vehicle manufacturers said the aromatic content of fuel must be reduced to 35% for cars produced to European standards to run properly, without increased wear and tear.

The strongest remaining option in the discussion paper also included phasing out low-octane fuel, which would increase the efficiency of vehicles, reducing emissions of other pollutants.

The review appeared to favour the middle-ground option, which regulated sulfur content and aromatics but allowed the continued sale of low-octane fuel.

By placing a value on premature deaths, and comparing that with costs borne by motorists and the petroleum industry, the department concluded that the middle-ground option was the best value for money, returning between $1.18 and $1.24 for each dollar the change cost.

It found the strongest regulatory option in the earlier papers would avoid an additional five premature deaths a year compared with the middle option, but would not result in a net financial benefit.

