Annual reports

Department of the Environment, Water, Heritage and the Arts Annual Report 2009-10

Department of the Environment, Water, Heritage and the Arts, 2010
ISSN 1441-9335

Operation of the Fuel Quality Standards Act 2000

The Fuel Quality Standards Act 2000 (FQS Act) provides the legislative basis for national fuel quality and fuel quality information standards for Australia. The FQS Act is in place to regulate the quality of fuel supplied in Australia and to ensure that, where appropriate, information about fuel is provided when the fuel is supplied.

Fuel quality standards exist for petrol, automotive diesel, biodiesel and liquefied petroleum gas (autogas). A fuel information standard exists for ethanol, when blended with petrol.

The FQS Act provides for criminal and civil penalties for non-compliance with Australian fuel quality standards. The monitoring, compliance and enforcement team take fuel samples for testing against each fuel's appropriate standard and investigators take any necessary enforcement action.

The Fuel Standards Consultative Committee (FSCC) is an advisory body to the minister on fuel matters. It is established under the FQS Act and the minister appoints members from each state and territory, the Commonwealth and various organisations with interests in fuel production and supply, vehicle manufacturing, consumer concerns and environmental protection.

Where a state or territory has fuel quality standards in place, the Commonwealth standards operate concurrently. State or territory standards apply where they regulate a fuel characteristic not covered by the Commonwealth standards.

Fuel standards may be varied by the minister on a short-term basis and for longer terms after consultation with the FSCC.

The minister must keep a Register of Prohibited Fuel Additives. There are currently no entries on the register.

Under the FQS Act, fuel suppliers must keep appropriate records and provide annual statements to the department.

Purpose of the Act

The purpose of the FQS Act is to regulate the quality of fuel in Australia, to:

The Fuel Quality Standards Regulations 2001 (FQS Regulations) cover: the regulation of fuel and fuel additives; the operations of the FSCC; the publication of notices about entries in the Register of Prohibited Fuel Additives; enforcement; and record keeping and reporting obligations.

Operational aspects of the Act

Fuel quality standards

Fuel Quality Standard Determinations set specific standards for petrol, automotive diesel, biodiesel and autogas. The determinations specify standards for a range of parameters, which address both environmental and operational performance.

The review of the Fuel Standard (Autogas) Determination 2003 progressed during the year, with the release of a public discussion paper in January 2010. The department received 11 written submissions in response to the paper. A government position paper will be released in late 2010.

Amendments to the Fuel Quality Standards Act 2000

The FQS Act was amended during the year. Royal assent for the amendments was granted on 6 November 2009. The amendments implemented a number of recommendations from the first statutory review of the FQS Act and addressed a number of operational issues.

The department is pursuing a series of amendments to the FQS Regulations to support the amendments to the Act and respond to emerging trends in the fuel industry with fuel blends. The amendments to the FQS Regulations are expected to be finalised in the second half of 2010.

The next statutory review of the FQS Act is due to commence in the second half of 2010.

Compliance

The Australian Government runs a fuel sampling program to monitor the quality of fuels sold in Australia. Fuel samples of all grades of fuel covered by the standards are taken throughout the fuel supply chain, in all states and territories. The monitoring program aims to take representative samples in each of the fuel markets around Australia, and respond to complaints made by consumers about fuel.

Fuel sampling is undertaken at distribution terminals, depots, service stations and other outlets. Samples are screened for compliance with the standards and, if required, are further tested at an independent laboratory accredited by the National Association of Testing Authorities. Testing methods are accredited to international standards.

Fuel quality inspectors directly employed by the department, and by some state and territory agencies, took 3,302 petrol, diesel, biodiesel and autogas samples during 2009-10, from around 865 sites across Australia. A total of 264 fuel quality compliance incident reports were received from consumers. In comparison, 3,825 samples were taken during 2008-09, from 1,123 sites, and 268 compliance incidents were reported.

Test results indicate a high level of compliance with the fuel standards. Where non-compliance with a standard is detected, further investigation is undertaken, with a view to prosecution where an offence can reasonably be proven.

On 25 November 2009 the Federal Court ordered that AAJ Associates Pty Ltd trading as Petro Point only supply diesel that complies with the diesel standard. The order was made for two years and the company was required to pay costs.

On 5 February 2010 the Federal Court ordered that Fullport Pty Ltd only supply diesel that complies with the diesel standard. The order was made for two years and the company was required to pay costs.

Audits of the terms and conditions of approvals to vary fuel standards under section 13 of the FQS Act are also conducted by fuel quality inspectors. During 2009-10, 11 audits were completed. The results indicate a generally high level of compliance.

Freedom of Information

Three freedom of information requests were received during 2009-10 involving the FQS Act and Regulations.

Reporting

This section fulfills the reporting requirements of the Fuel Quality Standards Act 2000 (section 71) for the period 1 July 2009 to 30 June 2010.

Committees

Section 24 of the FQS Act establishes the FSCC as a formal consultation mechanism. The committee is required to include one representative from each state and territory and the Australian Government. It must also include: at least one person representing fuel producers; one representing a non-government body with an interest in the protection of the environment; and one representing the interests of consumers. The minister may also appoint other members to the committee, which in 2009-10 included representatives from the motor vehicle manufacturing industry, independent fuel importers and suppliers, the alternative and renewable fuels industry, and the trucking industry.

Table 1 lists members of the committee during 2009-10.

The FSCC had two formal meetings in 2009-10, in July 2009 and February 2010. The committee also considered several issues out of session in November 2009.

Under section 24A the minister must consult the committee before:

Under section 13 of the FQS Act, the committee also provides advice on applications to vary fuel standards, including recommendations on the conditions to be applied. In 2009-10 the committee considered and made recommendations on 11 new applications under section 13 (see Table 2). Seven of these were for the supply of diesel containing biodiesel and four were for the supply of racing fuels. A total of $5,150 in fees was collected from applicants seeking approvals

Table 1: Membership of the FSCC 2009–10
Name Representing Start Date Finish Date
Paul Barrett Fuel producers 16/04/2007 16/04/2010
John Bortolussi Trucking industry 16/04/2007 31/07/2009
David Bowman Environment non-government organisation 16/04/2007 16/04/2010
Heather Brodie Alternative fuels industry 16/11/2009 16/11/2012
Ann-Louise Crotty New South Wales Government 13/07/2009 13/07/2012
Bruce Harrison Alternative fuels industry 4/01/2008 17/10/2009
James Hurnall Automotive industry 30/03/2008 30/03/2011
Bob Hyde Tasmanian Government 27/11/06
re-appointed 16/11/09		 16/11/2012
Damon Jones Victorian Government 13/07/2009 13/07/2012
Paul Kesby Chair, Australian Government Department of the Environment, Water, Heritage and the Arts 13/07/2009 13/07/2012
Ian Loy Trucking industry 16/11/2009 16/11/2012
Mike McCullagh Independent fuel producers 16/04/2007 16/04/2010
Scott McDowall Queensland Government 16/04/2007 16/04/2010
Craig Newland Consumer interests 17/06/2008 17/06/2011
David Power Australian Capital Territory Government 09/10/06
re-appointed 16/11/09		 16/11/2012
Jon Real Australian Government Department of Infrastructure, Transport, Regional Development and Local Government 16/04/2007 16/04/2010
Greg Scott Northern Territory Government 13/07/2009 13/07/2012
Michael Sheldrick Australian Government Department of Resources, Energy and Tourism 13/07/2009 13/07/2012
Kelvyn Steer South Australian Government 09/10/06
re-appointed 16/11/09		 16/11/2012
John Sutton Western Australian Government 16/04/2007 16/04/2010
Table 2: Approvals granted in 2009–10
Name of Approval Holder Period of Operation Approved Variation of Fuel Standard - refer to the gazetted Grant of Approval for complete approval & conditions Amendment
From To
Pro Green Biofuels Pty Ltd 20/04/2010 1/03/2011 Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to allow the supply of diesel with a biodiesel content of more than 5% but no greater than 20% volume by volume (v/v).1  
The National Biofuels Group Pty Ltd 21/12/2009 1/03/2011 Variation of approval, adding two regulated persons to the 26 February 2009 approval (effective 1 March 2009) to supply biodiesel blends (B20). Addition of 2 regulated persons
The National Biofuels Group Pty Ltd 2/11/2009 1/03/2011 Variation of approval, adding four regulated persons to the 26 February 2009 approval (effective 1 March 2009) to supply biodiesel blends (B20). Addition of 4 regulated persons
Caltex Australia Petroleum Pty Ltd 2/11/2009 1/03/2011 Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to allow the supply of diesel containing 20% biodiesel, with a maximum density of 860 kg/m³.  
Caltex Australia Petroleum Pty Ltd 2/11/2009 30/11/2010 Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to allow the supply of diesel containing up to 5% biodiesel, with a minimum derived cetane number (DCN) of 46.  
Shell NZ Ltd 24/08/2009 31/12/2010 Variation of an approval dated 15 December 2008, as follows: Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of unleaded petrol containing any of the following: aromatics up to 53.6% v/v, Di-isopropyl Ether (DIPE) up to 7.0% v/v, Methyl Tertiary-Buty Ether (MTBE) up to 15.1% v/v and Tertiary Butyl Alcohol (TBA) up to 7.0% v/v. This approval also varies the Fuel Standard (Automotive Diesel) Determination 2001 to permit the supply of diesel racing fuel with any of the following parameters: density up to 860 kg/m³, flashpoint of 56 degrees Celsius (C) minimum and viscosity up to 6.0 CentiStokes (cSt)2 at 40 degrees C. Addition of 6 regulated persons
BP Australia Pty Ltd 24/08/2009 31/12/2010 Variation of an approval dated 9 January 2009, as follows: Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of leaded racing fuel (avgas) containing lead up to 0.85 grams per litre (g/L). Addition of 8 regulated persons
Skyfuel Australia Pty Ltd 24/08/2009 31/12/2010 Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of leaded racing fuel (avgas) containing lead up to 0.56 g/L.  
Petrochem Carless Limited 24/08/2009 31/12/2010 Variation of the Fuel Standard (Petrol) Determination 2001 to permit the supply of specialist racing fuel containing MTBE up to 15% v/v and phosphorus up to 0.0298 g/L.  
Pre-Logic Pty Ltd 24/08/2009 1/03/2011 Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to allow the supply of diesel with a biodiesel content of more than 5% but no greater than 20% v/v.  
Australian Renewable Fuels Adelaide Pty Ltd; Australian Renewable Fuels Picton Pty Ltd; Eagle Fuels Pty Ltd; Mogas Regional Pty Ltd 21/08/2009 1/03/2011 Variation of the Fuel Standard (Automotive Diesel) Determination 2001 to allow the supply of diesel with a biodiesel content of more than 5% but no greater than 20% v/v.  

1 Volume by volume (v/v) is defined as [volume of substance]/[volume of solution] x 100. For example, fuel containing 5% v/v biodiesel has 5 litres of biodiesel in every 100 litres of blended fuel.

2 A unit of kinematic viscosity, one hundreth of a stokes.

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