Australian Biodiesel Tax Info

[Tubby Biofuels Forum Newbie Find all posts View Profile Close Tubby]

This topic was originally posted here, but I have since moved this part of the discussion to this new thread. The original topic on Containerised Plants in Brisbane, can be found here.

I have done this as the answer provided by Paddy below was quite useful as a topic in a thread of its own in this section.

[paddy Biofuels Forum Newbie Find all posts View Profile Close paddy]

Re: Containerised Plants

Tubby,

Building a plant is something that we can possibly discuss at a later date but I had a look at your question about what the government announcements re. 1 July 2006 will mean night. When I looked at the question I found the whole tax treatment of biofuels was very complex and decided to try to work through it.

I am keenly aware that some of the information below my be wrong (or indeed, very wrong) but I am posting it as a starting point - I hope that others others will contribute their understanding and correct any mistakes or enlarge on some of the questions.

My understanding is that there are 5 sets of tax/government support issues that have an impact on the tax treatment of biodiesel and while each of them is relatively straightforward it gets complicated when they overlap.

Set 1: Situation now (June 2006) - Standard excise duty with full refund.
Biodiesel is currently subject to 38.14c/litre tax but this is refunded in full by an equivalent production grant.

Set 2: Introduction of tax on biofuels 2011 - 2015
Biodiesel will be fuel tax exempt until 2011. From 2011 to 2015 the net fuel tax will increase gradually to 19.1c per litre (as refund decreases). This is approx half the ordinary tax on petrol and diesel when used for cars and trucks of less than 4.5 tonnes.

Set 3: Government reform of tax on fuel used for business.
The government is in the process of making the following business uses of fuel tax free (dates for implementation in brackets):

• Fuel used 'off road' (phased btw 2008 - 2012)
• Power generation (1 July 2006)
• Burner fuels (heating / kerosene) (1 July 2006)
• Fuel used in trucks heavier than 4.5 tonnes (1 July 2006) to be replaced by a 'flat?' Road User Fee. I don’t know how exactly this Road User Fee is calculated (the National Transport Commission does it) but I understand that it is likely to be only 20c per litre.

Set 4: Phase out of Alternative Fuel Grant under Energy Grants (Credit) Scheme - phase out (2006 - 2011).
Under this scheme set up on 1 July 2003, business users of biodiesel get a grant of 18c/litre. This will be reduced to 14.8c/litre on 1 July 2006 and disappear completely by 1 July 2010.

Set 5: Biofuels Capital Grants project
This is a government scheme that closed in 2004. It is not really related to tax but it gives successful applicants a grant of 16c/litre of biofuel. It is relevant in that producers who got grants will enjoy this grant in theory, although I practice the money was paid out to them at the time their production facility was created.

I have worked out two tables that I think set out the tax treatment of biodiesel when compared with (1) business use fuels and (2) private use fuels - I've attached them to this post as a PDF. Please report back on any errors they find or further information they come across.

Paddy

[Robert Administrator Find all posts View Profile Close Robert]

Re: Containerised Plants

I've moved this thread here under a new title as I think it will be useful for people looking for this info (thanks Paddy). I've left the original thread here.

[Steve-Kal Junior Member Find all posts View Profile Close Steve-Kal]

Anybody met the Fuel Quality Standards Act 2000 and got the cleaner fuels grant?

Dear All,

I'm doing a Feasibility Study into starting a home plant (appleseed) and doing it honestly i.e. obtaining an excise license and paying the excise (38.14c/litre). The figures work out, as here in Kal (WA) we are paying $1.50 for dino diesel and the prices only get higher.

However, the goal would be to claim the cleaner fuels grant to recoup the excise costs. To do this I would need to verify the product met the Fuel Quality Standards Act 2000.

Q1 - Has anyone managed to get their home processed biodiesel to meet this standard?

Q2 - Is there a lab in WA that can test samples of my home biodiesel to verify conformance (or not) with the quality requirements of the act?

Q3 - Are there any home brewers out there that are paying excise and claiming the cleaner fuels grant?

I hope someone out there can help.

Regards,

Steve

[Dodge Senior Member Find all posts View Profile Close Dodge]

Re: Australian Biodiesel Tax Info

I was reading some stuff yesterday and it seems a cetane engine is used for the testing and there is not a cetane engine in australia and also the people with the skills to operate it are required.
I may be wrong about the cetane engine the document i was reading i think was dated about 2003, so maybe there is one in australia now.
They cost $500,000 are a indirect injection variable compression engine.
The document says a lot of expertise is needed to operate these engines.
I also was reading somewhere that it costs $1000. to send a sample overseas to be tested, and that test is only valid for the batch it was taken from, that would be a difficult problem to solve if you are using a batch system.
I think that would only be worth doing if for continuos process system.

[Steve-Kal Junior Member Find all posts View Profile Close Steve-Kal]

Meeting the Fuel Quality Standards Act 2000 ?

Dear All,

There are commercial biodiesel plants in Australia operating well and selling on their product; right?

These must be testing to meet the standard in order to sell it commercially. They might be doing this in their own labs or sending it off to a dedicated lab for testing (to oil testing labs etc.).

I wondered if anyone had a contact for any QA people in one of these biodiesel plants?

They should be able to help with the details of a testing lab etc.

Thanks,

Steve

[Dodge Senior Member Find all posts View Profile Close Dodge]

Re: Australian Biodiesel Tax Info

Ok this may be of some help to you.
http://www.itscb.com/newsitetest/ser...tralia.shtml.:)

[Steve-Kal Junior Member Find all posts View Profile Close Steve-Kal]

Australian Biodiesel Tax Info

Thanks - I'll get quotes etc. and keep people posted with the progress.

[Dodge Senior Member Find all posts View Profile Close Dodge]

Re: Australian Biodiesel Tax Info

There maybe more, i found that site from doing a search for this standards reference number.
en iso 5165. astm d613
Yes would very interesting to see what it would cost, sample size required, and how long it takes.

[Dodge Senior Member Find all posts View Profile Close Dodge]

Re: Australian Biodiesel Tax Info

And i just found this, http://www.deh.gov.au/minister/env/2005/mr14jul05.html

[Stuart R Junior Member Find all posts View Profile Close Stuart R]

Re: Australian Biodiesel Tax Info

I don't know if anyone has posted this web site but I found a testing company in Sydney called Intertek Caleb Brett. Sorry can't supply their address but I headed my search on Google for 'Australia Biodiesel Testing Services. Hope this satisfies.
Cheers.

[Stuart R Junior Member Find all posts View Profile Close Stuart R]

Re: Australian Biodiesel Tax Info

More on Intertek Caleb Brett, their phone number is 02 9316 9969.

[Steve-Kal Junior Member Find all posts View Profile Close Steve-Kal]

Economic Viability of Biodiesel Testing to Claim the Clean Fuels Grant

Economic Viability of Biodiesel Testing to Claim the Clean Fuels Grant

Executive Summary
The simple economic analysis below concluded that claiming the clean fuels grant was not viable for biodiesel manufacturers with batch sizes of less than 6,200L.

Biodiesel Testing
Certified testing to test biodiesel fuel to the requirements of the Australian Fuel Quality Standards Act 2000 is available from:

Intertek Caleb Brett, Australia
Contact: Stuart Roberts - National Laboratory Manager
Tel: +61 2 9316 6544
Fax: +61 2 9316 6663
Mobile: +61 411 872 857
E-mail : stuart.roberts@intertek.com

Sample Volume required is 2L minimum. Turnaround time is approx 48 hours from receipt.

Cost to carry out the tests required to claim the grant is ~$2,350 inc GST.

They can also carry out additional testing: Cloud Point, Cold Filter Plugging Point and Filter Blocking Tendency for $290 inc. GST

Simple Economic Analysis
To claim the clean fuel rebate (of 38c/L) testing has to be carried out to verify conformance to the Australian Fuel Quality Standards Act 2000. Based on the above costs, a batch size greater than 6,200L would be required to justify the expense of testing. This analysis assumes that the batch will in fact meet the requirements i.e. The risk of a batch failure has not been considered.

[Sauman Senior Member Find all posts View Profile Close Sauman]

Re: Australian Biodiesel Tax Info

Good Day Everyone
I am putting on my business cap now.I just realised that Fare Labs Org, India which is a part of Simple Plant and Process Solutions is ISO 9001:2000 laboratory ,SIRO acedited and within a month ISO17025 (NABL)registered Research and Development and Testing laboratory.Meaning it can operate IN 143 countries providing services like R&D,Testing and technology development and deployment.
This means we can test any sample and offer our inference in any of the following countries.
Costs as we worked out is $1500 for 2L sample and $100 for freight.
Results within 48 hours.
And samples can reach India in 24 hours from Aus.DHL or Feedex will do it... no worries.I just spoke to them.
So yes folks I am also offering testing services besides any other consultation that commercial outfits might require.
Please do pass the word around.

Cheers
Sauman

[Dodge Senior Member Find all posts View Profile Close Dodge]

Re: Australian Biodiesel Tax Info

I wonder how much it would cost to buy a cetane engine to do the tests.
Thanks for posting those results Steve.