Friday, August 11, 2006

Biodiesel

The Government is trying to lower fuel prices without cutting into it's margins from the fuel excise. What it should see this as is an oportunity to promote alternative fuels, renewable fuels, environmentally responsible fuels. Ethanol is one of these fuels and can be produced from waste celuloe however current engines would need modification to run on pure ethanol. Current engines could run on a E20 mix though with no adverse affects. Last night BP and I think Caltex anounced that they would sell E10 at a discount price as Ethanol is currently cheeper than Petrol. So Ethanol is a good alternative but at the moment it is only a Mix-in to 'Ordinary Fuel'.
Biodiesel on the otherhand does run in current Diesel engines with no modifications to the engines. Beyoned that Biodiesel extends the life of a diesel engine because of Biodiesel being slightly more oily that regular Diesel. Biodiesel produces less of the harmful sulfides in the exaust because the sulfur compounds do not exist in the oil to start with. Biodiesel can be made from Vegetable oil and Ethanol providing a huge market for Farming products. This would help farmers and the beleagured sugarcane industry to recover, helping many communities that are currently struggling witht the impact of low price of sugar and impacts from narural disasters.
The next benefit would be to reduce Australias Carbon debt. Biodiesel comes from oil produced by plants so there is no net CO2 output into the atmosphere. Then if we Joined up with the Kyoto Protocol we could begin Carbon Trading, selling the carbon credits that we would have from our reduced emissions. Increaseing the input to the economy from this one industry that could be huge. Once the Biodiesel industry has become big enough we could then also be an exporter of Diesel. The Next benefit to the environment is that Biodiesel breaks down easier that fossil fuel Diesel, and so in the event of a spill there could be less damage to the environment.
With the High price of crude oil we have the perfect oportunity to promote the use of Biodiesel, encourage it's production and reduce Australia's Carbon debt. Instead though the Government Increases the Tax on Biodiesel so that a fledgling industry, that benifits farmers, the community and the environment, is burdened with increased cost instead of being given some tax breaks. If there was no Fuel Excise on Biodiesel it could be sold for about 50c a litre. People would buy it because it would be cheep incouraging the growth of a new industry that could provide employment and provide a way forward away from the relience upon fossil fuels that are found in politically unstable areas or in poorly maintained facilities (BP in Alaska).

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