Publications archive

Department of the Environment and Heritage annual report 2004-05

Volume two
Department of the Environment and Heritage, 2005
ISSN 1441 9335

Legislation annual reports 2004-05 (continued)

Operation of the Fuel Quality Standards Act 2000

This annual report is prepared in accordance with section 71 of the Fuel Quality Standards Act 2000. It covers the operation of the Act from 1 July 2004 to 30 June 2005. The Act was amended in March 2004 to enable labelling of fuel in the public interest, and the objects of the Act are now to:

  1. regulate the quality of fuel supplied in Australia in order to:
    1. reduce the level of pollutants and emissions arising from the use of fuel that may cause environmental and health problems
    2. facilitate the adoption of better engine technology and emission control technology
    3. allow the more effective operation of engines
  2. ensure that, where appropriate, information about fuel is provided when the fuel is supplied.

The Fuel Quality Standards Regulations 2001 cover the regulation of fuel and fuel additives; the operations of the Fuel Standards Consultative Committee; the publication of notices relating to entries in the Register of Prohibited Fuel Additives; enforcement; and record keeping and reporting obligations.

Amendments to determinations

The Fuel Quality (Petrol) Amendment Determination 2005 and the Fuel Quality (Automotive Diesel) Amendment Determination 2005 were signed by the minister on 13 May 2005 and registered on the Federal Register of Legislative Instruments on 15 June 2005. The amendments relate mainly to test methods used to determine compliance with the petrol and automotive diesel fuel quality standards. They also correct an error in the fuel standard specified for diesel where the decision taken by government when the standards were first introduced was not correctly represented in the final determination setting the standard.

Regulation of fuel quality

Petrol and diesel - environmental standards

Specific fuel quality standards have been set as Fuel Standard Determinations for diesel and petrol. These determinations were implemented on 1 January 2002, and include environmental and engine operability based standards for a range of parameters. The limits for a number of key parameters were either introduced or tightened from 1 January 2005 including:

Biodiesel

Limits for a number of parameters under the biodiesel standard came into force on 18 September 2004 including:

Future fuel standards - research and consultation

Petrol and diesel

Operability standards

Operability standards are standards linked to the more effective operation of engines. The Department of Industry, Tourism and Resources continued consultation with stakeholders on finalising outstanding operability standards for petrol and diesel namely:

The consultations culminated in a joint industry and government workshop held in Canberra in November 2004 where industry consensus was reached on the way forward. It was agreed that these parameters should be managed through industry guidelines and not through regulation under the Act. The guidelines are being developed by the Australian Institute of Petroleum in consultation with the Federal Chamber of Automotive Industries.

Future sulfur limits

The department was an active participant in a review by the Land Transport Environment Committee into fuel quality and motor vehicle emissions standards to take effect after 2006. The review considered further lowering maximum limits of sulfur in petrol and diesel. As a result new fuel standards announced in July 2004 will see sulfur in premium unleaded petrol reduced from the current level of 150 milligrams per kilogram to 50 milligrams per kilogram from 1 January 2008, and sulfur in diesel reduced from 500 milligrams per kilogram to 50 milligrams per kilogram on 1 January 2006 and capped at 10 milligrams per kilogram from 1 January 2009. A complete set of fuel standards is on the department’s web site.

Olefin content of petrol

A discussion paper relating to the future management of olefins in petrol was released for public comment in June 2005. The paper was prepared in response to a request by the Australian Institute of Petroleum for a degree of flexibility in setting olefins specifications. The paper examined the current management trends for olefins and considered options for future management. The Australian Institute of Petroleum submitted that the flat limit of 18 per cent for all grades, which came into effect on 1 January 2005, would put pressure on refineries in meeting the standard.

Diesohol

On 27 May 2004 the Department of the Environment and Heritage released a discussion paper for public comment on setting a fuel quality standard for diesohol. Diesohol is defined in the Fuel Quality Standards Regulations 2001 as a ‘blend primarily comprising diesel and an alcohol’. Also known as E-diesel, M-diesel and Oxy-diesel, the fuel is used in compression ignition engines as an alternative to diesel fuel. The focus in Australia has been on hydrous ethanol blends formulated using an emulsifier developed by Apace Research. An alternative technology used anhydrous ethanol and an additive. Diesohol is not subject to any formal or accepted industry quality standards, either in Australia or internationally.

Ethanol

The department commissioned the International Fuel Quality Centre to prepare a paper on issues surrounding setting a fuel quality standard for ethanol. The paper, which was released in November 2004, addressed ethanol standards setting in an international context along with discussion regarding various parameters regulated abroad. While the ethanol content of petrol blends has been capped at 10 per cent, with the requirement that blended petrol be labelled at the point of sale, there is no national fuel quality standard for fuel grade ethanol. Setting a standard will help to ensure that the environmental and vehicle operability objectives of the Act are met, and assist in building confidence in the fuel by ensuring a high quality is available. On 22 September 2005 the government announced additional measures to increase the uptake of ethanol blended fuels.

Compressed natural gas

In June 2005 the department announced that the existing Australian Standard AS 4564:2003 specification for general purpose natural gas is sufficient for the quality control of compressed natural gas vehicle fuel. The Fuel Standards Consultative Committee and the Australian Government agreed that the quality of compressed natural gas is already well controlled by an Australian Standard and by industry agreements, and concluded that there was little benefit to justify developing a fuel quality standard under the Act or amending the Australian Standard.

Methylcyclopentadienyl manganese tricarbonyl (MMT)

The use of MMT as a petrol additive was considered by the Fuel Standards Consultative Committee during the year. Consultations are continuing on the environmental and engine operability implications of the additive to assess whether there is a need for managing its use in petrol supplied in Australia.

Statutory review of the Fuel Quality Standards Act 2000

Section 72 of the Act provides for a review of the operation of the Act to be undertaken as soon as possible after the second anniversary of the commencement of Part 2 of the Act, which commenced on 1 January 2002.

This review was completed in April 2005 and provided an early opportunity to evaluate the operation of the Act and to propose corrective actions if necessary. The review considered the effectiveness and efficiency of sections of the legislation in achieving the function for which they were drafted, in the light of experience with administering the Act.

The review concluded that the overall policy objectives of the Act are being met and should not be altered, but that the following issues should be addressed:

Fuel Standards Consultative Committee

Section 25 of the Act establishes a Fuel Standards Consultative Committee as a formal consultation mechanism. The committee is required to include one representative of each state and territory, and the Australian Government. It must also include at least one person representing fuel producers, a non-government body with an interest in the protection of the environment and a person representing the interests of consumers. The minister may also appoint other members to the committee, which to date has included representatives from the motor vehicle manufacturing industry, independent fuel importers and suppliers, the alternative and renewable fuels industry, and the trucking industry.

Table 1 lists members of the committee during 2004-05.

Table 1: Members of the Fuel Standards Consultative Committee 2004–05
Member Representing Term (a)
Mr Peter Burnett, Chair Department of the Environment and Heritage  
Mr Bruce Dawson Victorian Environment Protection Authority until 13 October 2004
Mr John Bortolussi Truck manufacturing industry  
Dr David Bowman Environmental non-government body  
Mr Phil Cross Northern Territory Department of Infrastructure, Planning and Environment from 13 April 2004
Mr James Hurnall Consumers  
Mr Mike McCullagh Independent fuel producers and importers  
Mr Scott McDowall Queensland Environmental Protection Agency until 7 March 2005
Mr John Woodland Queensland Environmental Protection Agency 7 March - 29 July 2005
Mr Ewen Macpherson Australian Institute of Petroleum until 24 June 2005
Mr Steven Payne Department of Industry, Tourism and Resources  
Mr David Quinlan

Australian Capital Territory Department of Urban Services  
Mr Nigel Routh New South Wales Department of Environment and Conservation  
Dr Stephen Schuck Alternative and renewable fuels industry  
Mr Keith Seyer Vehicle manufacturing industry  
Mr Kelvyn Steer Tasmanian Department of Primary Industries, Water and Environment  
Mr Fred Tromp Western Australian Department of Environment  
Mr Tom Whitworth South Australian Environment Protection Authority  
Mr Geoff Latimer Environment Protection Authority Victoria from 13 October 2004
Mr Steve Sanderson Northern Territory Department of Infrastructure, Planning and Environment from 20 April 2005
(a) Unless otherwise stated, members served on the committee for the whole of 2004–05.

Under section 24A the minister must consult the committee before:

The committee provides written recommendations to the minister on the above matters. In relation to granting approvals under section 13 (that allows for specific variations to the fuel standards for specified periods), the committee made recommendations for 15 new approvals (see Table 2), and three amendments to existing approvals (see Table 3)

Table 2: New approvals granted 2004-05
Name of approval holder Period of operation Variation approved
Just Fuel Petroleum Service Pty Ltd 17 June 2005 –
31 December 2006

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of 10 specialist racing fuels.

Variation of the Aromatics, Oxygen, DIPE (a), MTBE (b) and Olefins parameters.

VPW Australia Pty Ltd 17 June 2005 –
31 December 2006

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of 10 specialist racing fuels.

Variation of the Aromatics, Oxygen, DIPE, MTBE and Olefins parameters.

VP Racing Fuels Pty Ltd

17 June 2005 –
31 December 2006

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of 10 specialist racing fuels.

Variation of the Aromatics, Oxygen, DIPE, MTBE and Olefins parameters.

Elf Competition Fuel and Lubricants Australia Pty Ltd

17 June 2005 –
31 December 2006

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of 10 specialist racing fuels.

Variation of the Aromatics, Oxygen, DIPE, MTBE and Olefins parameters.

  1. 10 Tenths Motorcycle Performance
  2. A1 Advanced Automotive
  3. Advanced Turbo Performance
  4. Auto-tech Automotive
  5. Bresciani Auto Repairs
  6. Competition Engines
  7. Feature Floors
  8. Ford Muscle Parts
  9. Haddad Race Cars and Engines
  10. Hercules Competition Engines
  11. Horsepower Research and Development
  12. Hume Performance
  13. Ian Williams Tuning
  14. LA Motor Repairs
  15. Nankervis Performance
  16. Neil Collins
  17. Pavtek Engines
  18. Terry Handley
  19. Waikerie International Soaring Centre
  20. Zig’s Marine
17 June 2005 –
31 December 2006

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of petrol with a lead content of greater than 0.005g/L.

Conditions attached.

  1. Australian Auto-sport Alliance Inc
  2. Australian Barefoot Racers Club
  3. Australian Formula Jet Sprint Association Inc
  4. Australian Historic Motoring Federation Inc
  5. Australian National Drag Racing Association Inc
  6. Australian Power Boat Association
  7. Australian Street Rod Federation
  8. Australian Tractor Pullers Association Inc
  9. Confederation of Australian Motor Sport Ltd
  10. Drag Bike Riders Association Australia
  11. Dry Lakes Racers Australia
  12. Ipswich City Dirt Kart Club Inc
  13. Motorcycling Australia
  14. National Association of Speedway Racing
  15. Queensland Racing Drivers Association Inc
  16. Ski Racing Australia
  17. South Australian Hot Rod Association Inc
  18. Street Machine Association South Australia
  19. Victorian Speedway Council
  20. West Coast Jet Sprint Club Inc

17 June 2005 –
31 December 2006

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of petrol with a lead content of greater than 0.005g/L.

Conditions attached.

BP Australia Bulwer Island 17 June 2005 –
31 December 2006

Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of diesel with a minimum density of 810 kg/m3.

BP Australia Pty Ltd

10 February 2005 –
31 December 2005

Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of (wintermix) diesel with the following parameters:

  • viscosity 1.2cSt@40oC
  • density 800kg/m3
  • lubricity 0.700mm
  • sulfur 1000ppm

Conditions attached.

The Shell Company of Australia

10 February 2005 –
31 December 2005

Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of (wintermix) diesel with the following parameters:

  • viscosity 1.2cSt@40oC
  • density 800kg/m3
  • lubricity 0.700mm
  • sulfur 1000ppm
Conditions attached.
Caltex Australia Petroleum Pty Ltd

10 February 2005 –
31 December 2005

Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of (wintermix) diesel with the following parameters:

  • viscosity 1.2cSt@40oC
  • density 800kg/m3
  • lubricity 0.700mm
  • sulfur 1000ppm
Conditions attached.
Mobil Oil Australia Pty Ltd 10 February 2005 –
31 December 2005

Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of (wintermix) diesel with the following parameters:

  • viscosity 1.2cSt@40oC
  • density 800kg/m3
  • lubricity 0.700mm
  • sulfur 1000ppm
Conditions attached.
BP Australia Bulwer Island

8 December 2004 –
30 June 2005

Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of diesel with a minimum density of 810 kg/m_.

The Shell Company of Australia

30 September 2004
– 28 October 2004

Variation of the Fuel Standard (Petrol) Determination to permit supply of unleaded petrol with an olefin content of up to 25%.

The Shell Company of Australia 30 August 2004 –
30 December 2005

Variation of the Fuel Standard (Diesel) Determination 2001 to permit the supply of Shell Aquadiesel.

Variations to the viscosity, density, and water and sediment parameters.

Caltex Refineries (Qld) Ltd

13 July 2004 –
30 December 2005

Variation of the Fuel Standard (Diesel) Determination 2001 to permit the supply of fuel certified by a minimum cetane number of 46 instead of a minimum cetane index of 46.

(a) DIPE = di-isopropropyl ether
(b) MTBE = methyl tertiary-butyl ether

Table 3: Existing approvals amended 2004-05
Name of approval holder Period of operation Variation approval Amendment(s) made (a)
Caltex Australia Petroleum Pty Ltd 21 March 2003 – 31 December 2004

Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of (wintermix) diesel with the following parameters:

List of regulated persons extended on 8 August 2004 (GN34, 25 August 2004)
  1. 10 Tenths Motorcycle Performance
  2. A1 Advanced Automotive
  3. Advanced Turbo Performance
  4. Bill Towler Mechanical Repairs
  5. Bresciani Auto Repairs
  6. BW Bikes
  7. C & R Motor Sport Developments
  8. Competition Engines
  9. Craig Wood
  10. DPC Performance
  11. Feature Floors
  12. Ford Muscle Parts
  13. Galaxy Services
  14. Gene Cook Race Engines
  15. Haddad Race Cars and Engines
  16. Hercules Competition Engines
  17. Horsepower Research and Development
  18. Hume Performance
  19. Ian Williams Tuning
  20. John White Racing Engines
  21. LA Motor Repairs
  22. Karman Motors
  23. Keith Nankervis
  24. Mike’s Auto Electrics and Dynotuner
  25. Nizpro Turbo Charging
  26. Pavtek Engines
  27. Proflo Performance
  28. Qantum Racing Industries
  29. Road Runner Wreckers
  30. RX Engineering
  31. Stafford Tune
  32. Terry Handley
  33. Waikerie International Soaring Centre
  34. Wilvaw Engineering
  35. Zig’s Marine

6 December 2002 – 30 June 2005

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of petrol with a lead content of greater than 0.005g/L.

Conditions attached.

List of regulated persons extended on 29 September 2004
(GN46, 17 November 2004)

  1. Aquatic Festivals Australia
  2. Associated Dirt Circuit Clubs of South Australia
  3. Australian Auto-sport Alliance
  4. Australian Barefoot Racers Club
  5. Australian Formula Jet Sprint Association Inc
  6. Australian Historic Motoring Federation Inc
  7. Australasian Jet Sports Boating Association
  8. Australian National Drag Racing Association Inc
  9. Australian Personal Watercraft Association
  10. Australian Power Boat Association
  11. Australian Saloon Car Federation Inc
  12. Australian Street Rod Federation
  13. Australian Tractor Pullers Association Inc
  14. Circuit Ski Club
  15. Confederation of Australian Motor Sport Ltd
  16. Drag Bike Racers Association Australia
  17. Dry Lake Racers Australia
  18. Ipswich City Dirt Kart Club
  19. Karratha Enduro and Motor Cross Club
  20. Motorcycling Australia
  21. National Association of Speedway Racing
  22. NSW Water Ski Association
  23. Perth Tractor Pull Association Inc
  24. Qld Racing Drivers Association
  25. Qld Ski Racing Association – Central Region Inc
  26. Ski Racing Australia
  27. SA Hot Rod Association Inc
  28. Street Machine Association South Australia
  29. Territory Motor Sports Board
  30. Victorian Speedway Council
  31. West Coast Jet Sprint Club
  32. WA Superkart Club Inc

6 December 2002 – 30 June 2005

Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of petrol with a lead content of greater than 0.005g/L.

Conditions attached.

List of regulated persons extended on 29 September 2004
(GN46, 17 November 2004)

(a) A notice under section 17A concerning a decision to grant or amend an approval is published in the Commonwealth Government Notices (GN) Gazette. A list of the approvals granted and amended is on the department’s web site at www.deh.gov.au/atmosphere/cleaner-fuels/variations/index.html.

(b) The viscosity, density, lubricity and sulfur parameters have been varied to allow the supply of ‘wintermix diesel’ to certain parts of Australia. ‘Wintermix diesel’ is a fuel that is fit for use in cold regions of Australia, which ensures that diesel engines and machinery will operate without the fuel being prone to ‘waxing’.

Monitoring and compliance activities

A monitoring programme continued during 2004–05 to test fuel industry compliance with the fuel quality standards. Fuel samples were taken in all states and territories of all grades of fuel covered by standards. The continuing monitoring programme aims to take representative samples in each of the fuel markets around Australia in addition to responding to fuel complaints made by consumers.

Fuel sampling is undertaken at distribution terminals, depots, service stations and other outlets. Samples are tested at a laboratory accredited by the National Association of Testing Authorities, Australia for compliance with the standards. Testing methods are accredited to international standards.

A new standard for biodiesel and changes to the chemical signature of diesel fuels meant that new cetane testing technology was needed in Australia. The department worked with the laboratory to purchase an ignition quality tester and install it in Melbourne. With the commissioning of this machine, the department can properly test for cetane levels in diesel and biodiesel fuels.

During 2004–05, 132 compliance incident reports were received and addressed. Inspectors took 869 petrol and diesel samples from approximately 420 sites nationwide. In comparison, during 2003–04 there were 822 samples from 400 sites, and 120 compliance incident reports.

Test results indicate a high level of compliance with the fuel standards. Where non-compliance with a standard is detected, further investigation is undertaken with a view to prosecution where an offence can reasonably be proven. Discussions commenced during the year with the Director of Public Prosecutions on four cases that were referred for potential prosecution action.

Administrative Appeals Tribunal

The Administrative Appeals Tribunal received one application under section 70 of the Act for the review of a decision.

ET Racing Fuels Pty Ltd filed with the Administrative Appeals Tribunal on 5 August 2004, with the case dismissed on 1 September 2004 on the grounds that the tribunal did not have jurisdiction to consider the application for review.

Communication with stakeholders

The department continued to work closely with industry and other stakeholders. The department produced two issues of the Clean Fuels Bulletin, an electronically distributed newsletter, and presented papers at four domestic and three international meetings.