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Coronavirus (COVID-19) Update – 26/03/2020

Greener Fuel Coming Soon

Under the European Union (EU) labelling system which became mandatory in Britain in September 2019, standard unleaded petrol became known as ‘E5’, indicating it contains up to 5% renewable ethanol, or bioethanol.

Co2 greener fuel

Unleaded petrol with up to 10% bioethanol is known as ‘E10’ and already in use in European countries such as Belgium, Finland, France and Germany.

According to the Department of Transport (DfT), while the E10 fuel blend is not yet available on British forecourts its sale has been permissible, legally, since 2013, and is set to be introduced to petrol stations in 2021.

Transport Secretary Grant Shapps said that what he described as a ‘small switch’, could ‘help drivers across country reduce the environmental impact of every journey.’ All told, switching to greener fuel could reduce overall carbon dioxide emissions from transport by 750,000 tonnes a year, an effect equivalent to taking 350,000 vehicles off the road.

Opponents of the introduction of the E10 fuel blend which include the RAC, argue that, while most new and used cars sold in Britain since 2011 must be compatible with the lower carbon fuel, a surplus of up to 600,000 vehicles have incompatibility issues, many of which belong to owners in the lower income bracket.

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Notwithstanding the fact that petrol stations are likely to lack the capacity to accommodate E5 and E10 fuel blends side-by-side, the choice between them will come down to cost and performance; fuel blend is also unlikely to have much effect on the cost of a private or motor trade insurance policy.

The Government consultation proposing the introduction of E10 petrol for British vehicles was launched following an announcement that a ban on the sale of new petrol, diesel and hybrid vehicles in Britain, originally planned for 2040 is being brought forward to 2035, possibly as early as 2032.

The revised date came about after experts warned that the original date may be too late to facilitate taking all the older conventional cars off the road by 2050, a date the Government has in its sights for virtually zero carbon.

In other fuel news, recently appointed Chancellor of the Exchequer Rishi Sunak, finally succumbed to years of pressure by announcing in his first budget speech. the removal of a tax ‘loophole’ surrounding so-called ‘red’ diesel in two years’ time.

Red diesel is taxed at just a fifth of the rate of standard diesel, and consequently costs the Treasury around £2.4 billion a year in lost revenue.

Subsidised red diesel accounts for 15% of all diesel used in Britain according to one estimate, it will remain available to agricultural, fishing and heating users for the foreseeable future.