Red diesel rules a 'Tory cash grab dressed as environmental measure'
- Published
From April the construction and manufacturing sectors will no longer be able to use cheaper red diesel to operate machinery
New rules restricting the use of red diesel are a government "cash grab dressed up as an environmental measure", an industry representative has said.
Gordon Best, from the Mineral Products Association NI, said it will have a "significant" impact.
Red diesel is standard diesel but taxed at a lower rate and dyed red to make it easily identifiable.
It is heavily used in the construction and manufacturing industries.
However, these industries will no longer be able to use it, external under new rules HM Revenue and Customs said are designed to help meet "climate change and air quality targets".
Companies in those industries that use rebated red diesel in their vehicles and equipment will have to switch to standard diesel and pay more for their fuel.
'Right policy, wrong time'
Mr Best, whose organisation represents the supply of construction materials in Northern Ireland, said the cost of materials and spending in the food sector would increase as a result.
"People know red diesel is just white diesel with a dye so this not about the environment," he said.
He said the move was "the correct policy at the wrong time", as there are issues with the technology used in large industry vehicles and the unavailability of zero carbon fuels such as green hydrogen.
"We said: 'At least phase out the rebate'," he added.
"The cost to the Northern Ireland economy is going to be about £25m and it's felt money would be better spent on energy transition in Northern Ireland."
He claimed the move would affect businesses in rural areas that cannot connect to the electricity grid, which use generators fuelled by red diesel to create power, and significantly increase the risk of theft.
Mr Best added that industries in Northern Ireland had started to decarbonise via energy efficiency measures such as moving company cars to electric and changing to lower carbon cements.
However, Queen's University Prof John Barry said that, while Mr Best made some good points, presenting "this as a cash grab could be seen as special pleading by the industry".
The professor, who specialises in green political economy, said the objective was to align an industry "which produces 14 million tonnes of carbon every year" with net-zero targets.
"The burning of diesel and other fossil fuel is the major cause of climate breakdown and the government's intention seems to be to pass the cost of that from consumers onto business," he said.
Prof Barry said the government could have approached the industry, which accounts for 15% of diesel use in the UK, and ask what other strategies they could use to decarbonise.
He said the UK must move away from "harmful subsidies" which "lock us into a sub-optimal fuels such as diesel".
"It's almost like the house is on fire and rather than putting it out we say 'let's delay'," he added.
Vehicles and machinery used in agriculture are still allowed to use red diesel
"When we have a climate change proposal we see - not climate denial from the industry - but it is climate delay," he said
"We have to move away from the burning of coal, oil, gas and fuel as quick as possible and I do hope this is a conversation around what does a just transition look like."
'Stopped tendering for jobs'
Paddy Deighan, from Stewart and McConnell Building Contractors in County Londonderry, said it will hit his company hard.
"We would have used red diesel for the diggers," he told Good Morning Ulster.
"We are a small building company and do a bit of plant hire - our mixers, forklifts and so on would have used red diesel and now it's going to have to be white diesel.
"The way the diesel is going up in price and building materials also have almost doubled in price - we have stopped tendering for jobs.
"I can't see any alternatives to diesel - I don't even know if you can get bio diesel in Northern Ireland," he said.
"You can still get green diesel in the Republic [the equivalent of red diesel in the UK]," he said.
"With the prices I just cant see people building new houses and doing extensions until we see what's going to happen with prices," he added.
What are the changes?
From 1 April 2022, red diesel can only be used for the following purposes:
For vehicles and machinery used in agriculture, horticulture, fish farming and forestry. This includes allowing vehicles used for agriculture to be used for cutting verges and hedges, snow clearance and gritting roads
To propel passenger, freight or maintenance vehicles designed to run on rail tracks
For heating and electricity generation in non-commercial premises, this includes the heating of homes and buildings, such as places of worship, hospitals and town halls; off-grid power generation and non-propulsion uses on permanently-moored houseboats
For maintaining community amateur sports clubs, as well as golf courses (including activities such as ground maintenance, and the heating and lighting of clubhouses and changing rooms)
As fuel for all marine craft refuelling and operating in the UK (including fishing and water freight industries), except for propelling private pleasure crafts in Northern Ireland
For powering the machinery (including caravans) of travelling fairs and circuses.
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