The head of the Renewable Fuels Association (RFA) sent a letter to Australia’s energy minister last week encouraging them to strongly consider U.S. ethanol imports as a cleaner, more affordable alternative to purchasing oil from the U.S. Strategic Petroleum Reserve.
The letter, from RFA President and CEO Geoff Cooper, cited news reports of Australia’s request for access to the U.S. Strategic Petroleum Reserve “as a hedge against potential oil supply disruptions that appear increasingly likely given the volatile situation in the Strait of Hormuz.” Ethanol is a better option to protect Australian consumers from supply shocks, Cooper said.
Cooper wrote that part of the challenge Australia is facing with renewable fuels growth— biofuels represent less than 2 percent of the country’s liquid transportation fuel supply—is the result of the 5 percent tariff and customs tax of A$0.401 per liter for ethanol imports. “These severe measures have made fuel ethanol imports generally uncompetitive with gasoline and domestically produced ethanol,” Cooper wrote in his letter to Angus Taylor, Australia’s Minister for Energy and Emissions Reduction.
“Removing or at least significantly reducing the tariff and custom tax barriers to imported ethanol does not necessitate a complex negotiation with the U.S. government over our Strategic Petroleum Reserve,” Cooper added. “Nor will it take much time. U.S. ethanol is available today for export to Australia. … U.S. ethanol can provide near-immediate relief to your transportation fuel supply shortage with the added benefit of providing Australia with a tangible demonstration of its commitment to carbon reduction.”