The media is calling out for A GREATER level of support for motorists and businesses who have been affected by the Red Diesel law change. These new changes will result with tens of thousands facing massive increases in fuel prices.
What is red diesel?
Red diesel is the same as standard diesel, or white diesel, but is dyed red to make it more identifiable because it is taxed at a much lower rate.
It is mainly used off-road. In engines such as to power bulldozers and cranes for the construction industry, or to power drills for oil extraction and tractors for farming.
Red Diesel AKA “Rebated diesel” has now been heavily restricted as of last month. This “U-turn” was brought about by the Government in an attempt to reduce greenhouse gas emissions.
Who are the most effected?
Businesses who were reliant on Red Diesel have been with the fuel making up 15 percent of the total national UK diesel usage. Those affected can no longer use rebated fuel, they will need to use either standard diesel or biofuels with the full rate of taxes.
Operating costs are expected to rise by around 15 percent as many of these businesses rely on fuel as a major part of their operations. This could equate to an increased fuel expenses of between £100,000 to £400,000 per year.*
In anticipation of the new law, many drivers found a surge in red diesel prices, along with record breaking fuel prices for both petrol and diesel.
Before the ban, many called out for a delay for the reasons of the rising cost of living, as well as supply chain issues and the global increase in oil costs.
* According to Research Management Association Scotland
“In continuing to entitle the agriculture industry to use rebated diesel, the Government has recognised that farmers need support both with energy pricing and with their green transition.
More is being asked of British farmers as we look to grow more produce closer to home in reaction to challenges to long-established supply chains as a result of COVID-19, Brexit and the ongoing war in Ukraine.
While continued access to red diesel and the efficient use of it as a fuel is part of the solution, we must continue to shift the dial if we are to address the growing climate emergency while continuing to guarantee food supply.”
