Diesel exemption from dangerous goods code under review

The NSW Environmental Protection Authority (EPA) recently approached ACAPMA seeking comment on a proposal to remove the current exemption of diesel from the Australian Dangerous Goods Code.

It is understood NSW EPA is seeking the reclassification because of the environmental damage that diesel spilt from fuel tanker accidents causes. The code provides for a product to be declared a ‘dangerous good’ due to it being deemed an environmentally hazardous substance.

Diesel is exempted from the code on the basis that the fuel is combustible only – as opposed to being both combustible and flammable.

This exemption means the national regulations for the on-road transportation, bulk storage and retail of diesel fuels are less onerous than those for petroleum fuels.

ACAPMA says it understands that the process for any removal of the exemption involves the NSW EPA first preparing a business case for the reclassification. This then forms part of an application to the National Transport Commission (NTC) – which administers the code – for a national consultative process over the proposed change.

Once the application is received and approved, the NTC must undertake a regulatory impact assessment to determine the likely costs and benefits of any future change in the existing regulations.

“At first glance, the likely impact of the proposed changes on our industry appeared to be relatively minor,” ACAPMA CEO Mark McKenzie said.

He added, however, that preliminary feedback received from a selection of ACAPMA member businesses solely involved in the Australian diesel market indicated that the implications arising from the change could be significant for these businesses and their customers.

“The reclassification of diesel as a ‘dangerous good’ means that diesel-only businesses would likely face increased capital and recurrent costs in a variety of areas – ranging from driver licensing and business insurance premiums to bulk tanker and storage infrastructure modifications,” Mr McKenzie said.

“There may also be flow-on effects for fuel retailers in respect of the storage and retail of diesel fuel under related state/territory regulations.”

Mr McKenzie said the early industry feedback suggested that any change to the current treatment of diesel under the code would require careful consideration of both the risk of potential future environmental damage and the likely economic costs to industry (and the community at large).

“It may also be worth our industry entering into discussions with relevant state/territory authorities to examine whether there are better alternatives to the current issue than the solution being proposed by the NSW EPA,” he said.

ACAPMA is preparing comprehensive advice for the NSW EPA in response to its request for input and says it is urgently seeking feedback from industry to assist with this process.

“We’re particularly interested in hearing from those businesses that are involved solely in diesel distribution, diesel wholesale and/or diesel retail in regional Australia – as these are the businesses that appear most likely to be negatively impacted by this proposal,” Mr McKenzie said.

“Our industry will never oppose laws targeting environmental protection, where such laws are clearly justified.

“That said, it’s important that these types of environmental decisions are carefully weighed against the likely adverse economic consequences for industry and the community at large.”

Any ACAPMA member interested in providing input on this matter should contact ACAPMA on 1300 160 270 or email Mr McKenzie directly, via markm@acapma.com.au.

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