Levi Gibbs

Published: January 11, 2023

Submitting To: Environment Select Committee

Issue for Business: The Sustainable Biofuel Obligation proposed that fuel suppliers had to reduce their emissions by at least 1.2% in 2023, and increase their reductions out to 2030, by using blended biofuels. In BEC's original submission in July 2022, BEC outlined that the obligation's start date April 1 2023, provided insufficient time for suppliers to build the necessary infrastructure and inform consumers on the safety of biofuels. We recommended at least a two year delay, or a reduced target in the initial years. Following BEC's July 2022 submission, the Government extended the timeline for the biofuels implementation by one year. The new starting date will be April 1 2024. However, the reductions target for year one would increase from 1.2% to 2.4%. This places significant strain on the industry to source limited global supply. The proposal has been introduced in parliament. BEC's submission reiterates the tradeoff between implementing this obligation and price. Among many other factors mentioned in this submission, BEC states the lack of clarity given about the exact sustainable nature of international supply. Land use change and feedstock uncertainty must be addressed.

Action: We spoke at the select committee about the submission, outlining the potential cost to consumers and the problems of global supply constraints, and the estimated supply concerns in the future. We reiterated the significant cost of updating infrastructure and flow on cost.

Outcome: The Government decided to abandon the Sustainable Biofuels Obligation due to cost of living considerations.