Home / FLD / Ethanol mandate could mean higher prices

Ethanol mandate could mean higher prices

Mandating the use of ethanol-blended fuel will push up prices in Queensland, Australia, petrol companies have warned. The state government released a report on the impact of its decision to introduce a 5% ethanol mandate on unleaded fuel sales by the end of 2010. While the report from the Department of Employment, Economic Development and Innovation found that overall there would be a neutral impact from the change, it also revealed that petrol wholesalers and retailers were opposed to the mandate. Major fuel wholesalers told the government it would cost them between A$1 million (US$928,100) and A$3 million (US$2.78 million) to implement the mandate, while upgrading individual service stations is estimated to cost up to A$25,000 (US$23,202) per site. Queensland Treasurer Andrew Fraser said the introduction of a 2% mandate in New South Wales had not increased the cost of fuel relative to other capital cities. The proposed mandate will not require that every liter of petrol sold contain ethanol, as the mandate will apply instead to total volume of petrol sold. (November 12, 2009)