MICKEL DEFENDS QUEENSLANDS 2010 ETHANOL MANDATE

Queensland must not rush into bringing in an ethanol mandate too soon, according to Minister for State Development John Mickel.

“The Queensland Government is an active supporter of ethanol and is working toward ensuring that Queensland has a vibrant and profitable ethanol industry,” Mr Mickel said.

“An ethanol mandate is just one strategy to ensure this occurs and we need to be sure that it achieves its objectives and works with our other ethanol development strategies, particularly the Government’s Queensland Ethanol Industry Action Plan 2005-2007.”

Mr Mickel said the Action Plan represented a $7.3 million investment in the ethanol industry in Queensland and the plan to date had achieved great success in both driving consumer acceptance of ethanol and the distribution of ethanol blended fuel.

For example, the number of service stations retailing ethanol blended fuel has increased from approximately 40 in 2005 to over 220 today.

“The Queensland Opposition have stated that they intend to reintroduce to the Queensland Parliament legislation to enact an ethanol mandate in Queensland,” Mr Mickel said.

“I think this legislation is premature.

“The introduction of a mandate requires careful consideration to ensure it effectively supports a Queensland ethanol industry,” he said.

“The Opposition’s plan would force fuel companies to import ethanol and that serves neither the consumer nor the industry.”

Mr Mickel’s argument is based on the current supply of ethanol in Queensland.

At the present time, Queensland produces around 32 million litres of ethanol, approximately 20 million of which are used in Queensland’s fuel supply. The remaining 12 million is exported interstate for other uses.

Mr Mickel said to meet the Government’s proposed 5 percent mandate some 177 million litres of ethanol were required – a 157 million litre shortfall.

“This shortfall can only be met by ensuring that new suppliers come on line.

“To this end, my Department is working with a number of ethanol projects, including two new developments at Pinkenba and Dalby, which have the potential to easily meet the production required for the 5 percent mandate,” Mr Mickel said.

He said it took time for these types of projects to come on stream.

“If you impose a mandate too far ahead of supply, all you do is mandate imports and you’ll damage this emerging industry in Queensland just as it’s getting off the ground,” Mr Mickel said.

“Research indicates that a proportion of consumers are still concerned about ethanol damaging their car engines.

“While ethanol is safe in most vehicles, the Queensland Government will continue its +e campaign to inform consumers about ethanol and its use,” he said.

The +e campaign, which is part of the Queensland Ethanol Industry Action Plan, has seen the number of consumers using ethanol increase from one in six to one in four in the past two years.

Mr Mickel said the most recent reporting period showed a further rise to two in five motorists, and of these three quarters were repeat purchasers.

“The ethanol industry is growing in Queensland,” Mr Mickel said.

“Early this week, Caltex announced a deal under which they would take 30 million litres of ethanol over three years from the Dalby Bio-refinery.

“And BP is rolling out E10 as its standard unleaded petrol option across Queensland.

“This is a clear indication that fuel companies are confident that ethanol has a future, that the Queensland Government is supportive of it and that Queensland is the place to buy it from.”

The Government plans to introduce a 5 percent mandate in all petrol sold and produced in Queensland by 2010.

Media contact: Chris Brown 3224 7349 or Elouise Campion 3224 6784.

25 May, 2007