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January 26th 2019


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Articles from this issue:

COVER STORY The Natural Family as an integrative social force in American history

EDITORIAL The Remnant, resistant, creative minority

ENERGY POLICY Enough hot air about carbon dioxide; let's talk LPG

CANBERRA OBSERVED Federal election: the media have done our duty at the polls for us

NSW ELECTION NSW is just starting to sizzle

NATIONAL AFFAIRS Archbishop Wilson free, but trial was no witchhunt

NATIONAL AFFAIRS Awaiting Hayne: full report sure to shake finance sector

LIFE ISSUES The unvarnished truth about surrogacy

HIGHER EDUCATION Massification: that's the name of the game

SOCIETY Dover Beach: a mordant post-Christmas reflection

IRELAND TODAY Celtic Tiger changed out of all recognition

MUSIC One note does not a monotone make

CINEMA Aquaman: High fantasy in ocean depths

BOOK REVIEW Uninformed consent

BOOK REVIEW A thoroughly modern movement

BOOK REVEW The foundation of a successful society

LETTERS

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ENERGY POLICY
Enough hot air about carbon dioxide; let's talk LPG


by Chris McCormack

News Weekly, January 26, 2019

With all the nonsensical effort and taxpayers’ money being expended to reduce harmless carbon-dioxide emissions, is it time for the Federal Government to revisit subsidising conversions of vehicles to run on liquefied petroleum gas (LPG), which will actually help reduce harmful emissions?

All-terrain LPG-powered vehicle.

In 2006, under Prime Minister John Howard, LPG vehicle conversions began to be subsidised to the tune of $2000 per vehicle, while the purchase of a new LPG-powered vehicle attracted a $1000 rebate. This amount was gradually reduced under the ALP government until ceasing altogether in mid 2014 at the end of the eight-year scheme. It was not renewed under the Abbott Coalition government.

The scheme cost around $594 million, with 317,847 grants issued over the eight-year period. The scheme’s aim was for greater uptake of LPG in order to reduce the overall amount of toxic and carcinogenic pollutants emitted from motor vehicles.

LPG is made during natural-gas processing and oil refining whereby it is isolated, liquefied through pressurisation and stored in pressure vessels. LPG emits 20 per cent less nitrogen oxides and 60 per cent less carbon monoxide, and has a much lower sulphur content than petrol. LPG vapours are also 50 per cent less reactive than petrol, meaning they are less likely to contribute to smog.

Compared with diesel-powered vehicles, LPG cars produce 95 per cent less nitrogen oxides (which can cause lung disease) and 120 times less particulates.

If governments are determined to worry about carbon-dioxide emissions, then a “well to wheel” examination maintains that diesel and petrol carbon-dioxide emissions are 29.2 per cent and 26.8 per cent respectively higher than for LPG.

LPG engines also experience less wear and tear as a result of a cleaner combustion process, ensuring a longer engine life and lower costs to the owner in replace­ment of parts and servicing.

Additionally, more vehicles – including industrial-scale vehicles – running on LPG would ensure a greater degree of energy security, as currently all our LPG is sourced locally, whereas around 90 per cent of our petrol and diesel is imported. The Australian Petroleum Statistics January 2018 issue found that Australia had 23 days’ worth of petrol, 20 days’ aviation fuel and 17 days’ diesel oil in reserve to use in an emergency.

Moreover, Australia’s Liquid Fuel Security: A Report for NRMA Motoring and Services found said that “our unwillingness to assure our liquid fuel supplies puts at risk many of the societal functions that we take for granted” and should our supply be interrupted, “essentially, our society as we know it would cease to function”. This is an untenable energy security position.

If a gas reservation policy were implemented in all states and territories (similar to the policy in Western Australia), this could also hedge against unexpected increases in the domestic LPG price, which is primarily determined by the Saudi Contract Price (SCP).

The availability of LPG in service stations across Australia has declined markedly in recent years in line with a 68 per cent decline in LPG sales since 2010. Around 60 per cent of Australian service stations sell LPG.

The end of Australian car manufacturing, when Holden and Ford ceased production of their new LPG vehicles, contributed to the decline in LPG use. As did the introduction of an excise on LPG in 2011, which became indexed to CPI in 2015 and now stands at 13.4¢ per litre. This means LPG shifted from around 45 per cent of the cost of petrol to nearly 60 per cent. (However, at the time of writing, LPG prices were as low as 59¢ per litre, compared with around $1.09 for unleaded petrol in Victoria.)

Together with the rise of more powerful and fuel-efficient vehicles, these factors have resulted in 29.9 per cent fewer LPG vehicles being registered in 2017 compared with 2012.

Australian-owned independent fuel chain APCO runs 25 service stations in Victoria and Albury (NSW), all of which have LPG bowsers. Director Peter Anderson said that the cost for a mandatory service of the gas tank every 10 years was $20,000–$30,000, which meant that, with lower volumes sold, he would have to consider the economic viability of installing LPG bowsers on any new outlets.

Mr Anderson said at present there was “no margin in LPG” but removing the GST and fuel excise from LPG would improve the attractiveness of LPG usage. He said that he was seeing a reduction of 1 million litres in LPG consumption every year.

While supporting greater uptake of LPG, careful implementation around a strong regulatory framework and scrutiny of any new subsidy program promoting LPG conversions would be needed to avoid any price gouging by operators who simply increased the price of LPG conversions, negating any cost benefits of the subsidy to the consumer, Mr Anderson said.

It makes sense for the Federal Government to encourage greater uptake of LPG vehicles. The environmental and health benefits alone, with cleaner air in the increasingly congested capital cities presenting a strong case for LPG. Just think of people working on enclosed factory floors with forklifts running on LPG: lower toxic emissions enable a safe working environment for all.

Energy security would also be greatly enhanced by removing our reliance on geopolitical stability favouring the continued supply of imported fuels to run the country. It’s time the Government looked again at encouraging greater adoption of our plentiful supply of clean, green LPG.




























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