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Fuel quality

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Exceptions to the standards

The Act prohibits the supply of fuels that do not meet the standards set out in the Determinations for use in motor vehicles.

The Act also prohibits altering fuel so that it breaches the specifications of a standard, in prescribed circumstances.

There are four main exceptions to the prohibitions of the Act:

1. The petrol standard does not apply to fuel supplied for use solely at a racing event or on a race track approved or recognised by:
   • the Confederation of Australian Motor Sport;
   • the National Association of Speedway Racing;
   • the Australian National Drag Racing Association;
   • the Australian Karting Association; or
   • Motorcycling Australia.
2. An approval varying the standard for specified fuel supplies for a limited time can be granted under the Act by the Minister for the Environment and the Heritage.
3. If the supplier believes that fuel will be further processed to bring it into compliance with the standard, it is not an offence to supply 'off-spec' fuel.
4. The supply of 'off-spec' fuel may be permitted under a direction or order made under an emergency law.

The new standards

The Commonwealth Government has passed legislation to ensure Australian consumers receive high quality petrol and diesel.

The Fuel Quality Standards Act 2000 (the Act) and the Fuel Quality Standards Regulations 2001 (the Regulations) provide the framework for enforcing national fuel quality standards.

The legislation regulates the supply of fuel to consumers, helps reduce toxic vehicle emissions and ensures that, by using clean fuels, modern vehicles fitted with advanced emissions control technologies can operate at peak performance.

The new standards are prescribed in the Fuel Standard (Petrol) Determination 2001, and the Fuel Standard (Diesel) Determination 2001.

Where a State or Territory has fuel standards in place, the Commonwealth standards will operate concurrently. State or Territory standards apply where they are more stringent or regulate a fuel characteristic not covered by the Commonwealth standards.

Under the legislation it is an offence to:

• supply fuel in Australia not complying with a fuel standard, or an approval to vary that standard;
• alter fuel in Australia that is the subject of a fuel standard, or an approval to vary that standard, if the fuel is intended for use in Australia;
• supply a fuel additive in Australia that is listed on the Register of Prohibited Fuel Additives;
• fail to provide a statement or other information about whether supplied fuel complies with a fuel quality standard; and
• not comply with record keeping and reporting obligations of the legislation.

The legislation, which is fully enforceable from 1 January 2002, will help Australia to reach international fuel quality standards.

A supplier or producer found guilty of supplying 'off-spec' fuel may face penalties of up to $550,000.

The new standards will enable the more effective operation of petrol and diesel vehicle engines. Standards for other fuels such as liquefied petroleum gas, compressed natural gas and biodiesel are also being developed.

Monitoring compliance

Commonwealth inspectors will conduct random fuel sampling at refineries, terminals, distribution terminals, service stations and other outlets from 2002.

Samples will be tested at laboratories accredited by the National Association of Testing Authorities, Australia.

The Act sets out the powers and obligations of inspectors. Inspectors must identify themselves and can only enter premises with the consent of the occupier or their representative, unless the inspector holds a monitoring or offence-related warrant issued under the Act.

The offence-related powers authorise Commonwealth inspectors, with consent or a warrant, to:

• conduct a search;
• inspect, measure, test, or take samples of any fuel or fuel additive;
• take photographs or video recordings; inspect and copy any book, record or document;
• carry onto, and use equipment, on the premises;
• secure evidence until a warrant is obtained to seize it;
• operate equipment; and
• remove documents and disks, or transfer information onto a disk or other storage device.

Inspectors will be properly qualified to exercise these powers safely in places where fuels are supplied.

Record keeping and reporting

Under the new legislation fuel suppliers, including importers, producers, distributors and other suppliers, must provide, along the fuel supply chain, documentation relating to the fuel.

However, where fuel is supplied to an end-user such as consumers purchasing fuel at a service station, or in relation to bulk sales to an end-user (eg. a farmer or vehicle fleet operator), documentation is not required.

Information must include whether fuel complies with the relevant fuel quality standard and, if not, how and why the standard has not been complied with.

A supplier should provide documents within 72 hours of delivery of the first (or full) batch of a fuel order. Other information about the supplier, the product and the delivery docket number must also be provided in accordance with the Regulations.

Vehicle operators must provide further information, including a signed statement that they have not altered the fuel.

Industry documentation, production and distribution processes may be investigated if 'off-spec' fuel is detected through random sampling carried out by Environment Australia.

A record of all fuel documentation must be kept and retained for each calendar year for two years thereafter.

Failure to provide accurate information about compliance with the national fuel quality standards and other prescribed matters can be an offence carrying large penalties under the Act.

From early 2003, fuel producers and importers will be required to report annually to Environment Australia on fuel they produced and supplied in 2002. Some of this information will be included in Environment Australia's annual report tabled in Federal Parliament.

Application to vary a fuel standard

An application to supply fuel that differs from the standard can be made to the Minister for the Environment and Heritage (the Minister).

Under the Act, the Minister can grant an approval that varies a fuel quality standard with respect to specified supplies of fuel for a specified time. The Minister is required by the Act to have regard to the recommendations of the Fuel Standards Consultative Committee (FSCC) before granting an approval to vary a standard.

The FSCC comprises representatives from Commonwealth, State and Territory governments and industry and consumer organisations.

Unsuccessful applicants have a right to appeal to the Administrative Appeals Tribunal.

An application for an approval must be made in accordance with the Fuel Quality Standards Regulations 2001.

Further information

The Commonwealth's new fuel quality standards legislation and the Procedures Manual for Approvals - Fuel Quality Standards Act 2000 are available from the Fuel Quality Standards Act 2000 page.

Further information is available from Environment Australia''s Community Information Unit on 1800 803 772 or email ciu@deh.gov.au

Disclaimer

The information contained in this pamphlet is of a general nature only and should be read in conjunction with the Fuel Quality Standards Act 2000, the Fuel Quality Standards Regulations 2001, the Fuel Standard (Petrol) Determination 2001 and the Fuel Standard (Diesel) Determination 2001. Fuel suppliers may wish to seek legal advice about their obligations under this legislation.

January 2002