The National Party is questioning the timing of the Government’s proposed biofuels mandate and says it will only add to the rising cost of fuel.
National’s transport spokesperson Simeon Brown points to advice from officials which shows the policy would add between five to 10 cents a litre to the cost of fuel. He says it “couldn’t come at a worse time for consumers”.
“The Government only recently responded to the cost of living crisis by reducing fuel excise 25 cents per litre temporarily and announced a temporary reduction in RUC rates.
“However, forging ahead with a biofuel mandate will only put that pressure back onto working families.
“This Labour Government is giving with one hand and taking with the other. Motorists already pay for the effects fuel has on the climate through the Emissions Trading Scheme, which adds approximately 19c to a litre of fuel,” Brown says.
Meanwhile, National’s energy and resources spokesperson Stuart Smith says the biofuels mandate will mean “consumers are paying twice for the effects fuel has on the climate”.
“While National is supportive of biofuels and reducing our carbon emissions, the Government cannot double dip into Kiwis’ pockets by taxing them through the ETS and the biofuel mandate,” Smith says.
Reducing emissions
The Government announced its proposed biofuels mandate in December and says it will help reduce greenhouse gas emissions in the transport sector.
From April 1, 2023, fuel wholesalers will be required to cut the total greenhouse gas emissions for transport fuels they sell by a set percentage each year, by deploying biofuels as a part of their fuel supply.
From April 1, 2023, fuel wholesalers are expected to reach a starting emissions reduction target of 1.2%, which will increase to 2.4% in 2024 and to 3.5% in 2025.
Provisional targets for 2026-2030 will be confirmed by Cabinet in 2024 and the provisional targets for 2031-2035 in 2029. The mandate will be reviewed after two years.
Commenting at the time of the announcement, transport minister Michael Wood said liquid biofuels are a “renewable, low-emissions fuel source that can be immediately used to reduce our transport sector emissions”.
“We need to transition to low-emission vehicles, and biofuels will help reduce emissions while we make that transition. Biofuels have the potential to boost economic recovery through encouraging a local industry and creating jobs,” Wood says.
The mandate is expected to prevent about one million tonnes of emissions from cars, trucks, trains and ships over the next three years and up to 10 million tonnes by 2035.
