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Senator the Honourable Robert Hill
Federal Minister for the Environment

Address to

Urban Natural Gas Vehicles Conference


(Hosted by: The Australasian Natural Gas Vehicles Council)
Australian Jockey Club -- Randwick
19 June 1997

Introduction:

This conference comes at an important time. Like many other countries around the world, Australia is carefully reassessing its energy policies as the adverse environmental ramifications of current generation and consumption patterns become more apparent and ubiquitous.

At the global level, there is growing evidence that our heavy reliance on fossil fuels internationally is already having a discernible effect on the world's climate, and that this effect will increase in magnitude during the lifetimes of our children and grandchildren.

In addition to creating greenhouse gas emissions (principally carbon-dioxide), fossil fuel use is the primary cause for dangerous levels of urban air pollution in cities around the world. As our air quality research improves indications are that fine airborne particles and various air toxics like benzene are far more harmful to human health than previously thought.

These environmental threats present governments with an obligation to review policy and to act. Because of the transport sector's significant role in causing urban air pollution and to a lesser extent greenhouse emissions, industries such as your own have an opportunity to profit from environmental improvement, and contribute to the public good at the same time.

It is this convergence of interests which makes me particularly pleased, as Environment Minister, to join you here today.

The Problem: Air Pollution & the Contribution by Transport:



I want to briefly focus on the nature of urban air pollution in Australia -- as this has an obvious bearing on both government policy responses, and the potential role for Natural Gas Vehicles in the Australian context.

We have as a country made significant gains in urban air quality in the past 15 years as emission controls have tightened, fuel efficiency has improved, and leaded petrol is being phased out.

However, our perceived progress has been partly offset by our increased knowledge about the dangers of those air pollutants which remain. It's not so much that the goal posts have shifted, but rather that they have narrowed -- and some of the goals we thought we'd kicked actually went wide of the mark.

One good example of the goalposts narrowing is airborne particulate pollution. Whereas we once lumped all particles into the one category of Total Suspended Particulates -- irrespective of their size, we now know that it's the very fine particles that pose the greatest health danger, especially those less than 10 microns in diameter (PM-10).

Other research indicates that for many air toxics which have been largely unregulated until quite recently, there may be no completely "safe" level in terms of protecting human health.

Last week media reports claimed that 400 people die in Sydney each year as a direct result of air pollution. A day later, the Queensland Transport Minister announced that between 46 and 82 Brisbane residents were dying each year as a result of air pollution related illnesses. While the veracity of these figures is hard to confirm, they at least suggest that health issues related to air pollution must be taken seriously.

It's not surprising that air pollution ranks as the Australian public's number one environmental concern. We cannot avoid the fact that motor-vehicles are a major cause -- contributing over 50% of air pollution in urban areas. Road vehicles are also responsible for the vast majority of the 12% contribution which the Transport sector makes annually to Australia's greenhouse gas emissions.

Some say we should stop people driving their cars -- but I am generally sceptical of such strategies. I'm sure we can encourage better practices, but people will always want to drive their cars. My preferred solution is to get people driving vehicles that cause less air pollution and less greenhouse emissions.

This is where Natural Gas Vehicles have an important role to play.

The Advantages of Natural Gas Vehicles (esp. Air Pollution):



It is increasingly likely that the world will turn to one or more alternative sources to power the automobiles of the 21st century. While fuel cell technology is appears to be the front-runner at this point, refining the technology and producing price-competitive vehicles on a mass scale will take some years.

In the meantime, as part of our response to urban air pollution and climate change, we need to maximise the use of existing fuels which can reduce the environmental damage of the transport sector.

CNG and LNG fit the bill. CNG and LNG are useful transitional fuels, even though the most likely long-term use for natural gas will probably be electricity generation. Australia is fortunate to have abundant quantities of natural gas. In fact our annual exports of the LNG are projected to increase from 7.6m t tonnes in 1995-6 to 21.5m tonnes in 2004-5.

In terms of air pollution, the advantages of CNG (the principal form used for transport in Australian settings) as a transport fuel are impressive.

Even where petrol is mixed with Natural Gas, there is a 20% fall in carbon-dioxide relative to a car exclusively run on petrol, a 50% fall in oxides of nitrogen, a 53% fall in carbon monoxide, and an 80% fall in hydrocarbons.

The comparisons with diesel are just as impressive, and perhaps more relevant given that the most common application of natural gas in Australia is in the heavy vehicle sector where diesel is commonly used. Diesel is the source of some 90% of the vehicular contribution to particulate pollution.

A Swedish comparison between a bus powered by diesel, an equivalent NG powered bus showed emission reductions of a similar magnitude with the added advantage of a 76% reduction in particulate matter.

So, there are clearly advantages to be gained from using natural gas vehicles in terms of reduced greenhouse emissions and improved urban air quality. The Government recognises this role in its response to these environmental problems -- a response I will now outline in more detail.

Commonwealth Action on Air Pollution & Alternative Fuels:



Our response to air pollution is an important component of the Howard Government's core environmental program -- the $1.2 billion Natural Heritage Trust, which was recently launched by the Prime Minister.

The Air Pollution in Major Cities Program, which is being funded by the NHT, will address the problems confronting our urban settlements in five ways. (I will resist the temptation to call it a "Five Point Plan").

First, we have funded an independent Inquiry by the Australian Academy of Technological Sciences and Engineering to examine solutions to Air Pollution. This inquiry, which has included widespread public consultation, will report its findings in September of this year.

Second, we are working to develop National Environment Protection Measures for ambient air quality through the National Environment Protection Council. Draft Measures for public comment have now been released.

Third, we are working with non-government organisations on programs like "Smogbusters" to raise public awareness about air pollution, and to encourage higher patronage of public transport and reduced reliance on motor vehicles.

Fourth, we are funding programs to improve monitoring and reporting of air quality in major population centres -- something which is vital if we are to properly target our solutions.

Finally, the Air Pollution in Major Cities Program provides funding for scientific research aimed at improving the basis for policy actions related to air quality -- research, for example into the emission performance of our vehicle fleets.

The impact of transport on Australia's greenhouse emissions is also an important element of our a new National Greenhouse Strategy, which is currently being finalised, and which includes an examination of the role for alternative energies like natural gas.

Also, the government is in the process of preparing a White Paper on Sustainable Energy which will lay the foundations for our energy strategy as a nation over the next 20 years. This too will encompass the potential contributions by alternatives including natural gas vehicles.

Government Assistance for the NGV Industry in Australia: Through the Air Pollution in Major Cities Program, the National Greenhouse Strategy, and White Paper on Sustainable Energy, the government is helping to carve out a clear role for Natural Gas as an important player in Australia's energy and transport sectors.

With respect to the Natural Gas Vehicle industry in particular, we provide important financial advantages. Sales Tax is not applied to component parts used for converting vehicles to natural gas. We also provide an excise exemption for alternative fuels -- assistance which is worth approximately $10 million for CNG.

Last week's announcement of an industry-wide environmental strategy in relation to the motor vehicles industry, and the development of an industry code of environmental performance, may boost NG vehicles.

Fuel efficiency targets and the adoption of fuel efficiency labels on cars should also boost awareness of the environmental benefits of NG vehicles.

What the NGV Industry can do: Despite the measures which we are taking which can assist the NGV as an industry, and despite our enthusiasm about NGVs, we are realistic about the potential of the industry in the Australian context.

The collaborative work by Planet Ark and Volvo in promoting NG-fuel blend cars for use in Australia is encouraging. The Taxi Project being conducted by Ford Motor Company's Taxi Project is also an exciting application of new NG technology and design in Australia which provides scope for the commercial expansion of NGVs.

However, the lack for refuelling infrastructure, the high conversion costs and the low vehicle range of NGVs relative to the competition, will continue to make the urban heavy vehicle fleet market the most viable application of NGVs in Australia in the foreseeable future.

Heightened public awareness and concern about urban air pollution is helping to create a niche market for natural gas in public transport fleets, and I would encourage you to maximise this opportunity.

I would also acknowledge the input we have had from your industry in our numerous policy review processes -- the independent Air Pollution Inquiry and the Sustainable Energy Green Paper -- and I encourage your continued involvement.

Conclusion:



In conclusion, the government recognises that Air Pollution is the public's number one environmental concern, and we are responding in a number of ways through the Air Pollution in Major Cities Program, the National Greenhouse Strategy and the White Paper on Sustainable Energy.

We see the increased use of Natural Gas Vehicles as an important component of our response to the problem.

There is great potential for this industry to expand in Australia, particularly in the urban public transport sector where infrastructure problems are most easily overcome, and the environmental benefits maximised.

Your desire to increase the use of NGVs is mutually compatible with the very high priority this government places on fighting urban air pollution, and I look forward to working with you to further these very complementary goals.

Commonwealth of Australia