Motor Fuel (Composition and Content) (Amendment) (Northern Ireland) Regulations 2022

Baroness Randerson Excerpts

Tuesday 11th October 2022 Grand Committee

[The Parliamentary Under-Secretary of State, Department for Transport (Baroness Vere of Norbiton) (Con)]

My Lords, these regulations relate to the introduction of E10 petrol in Northern Ireland. Regulations relating to the introduction of E10 petrol in Great Britain were considered and agreed to by your Lordships’ House in 2021, and I should note that this introduction has been successful, with no significant concerns raised.

E10 petrol contains up to 10% of renewable ethanol, double the amount blended into E5 petrol. Increasing the renewable ethanol content in standard grade petrol across the UK can reduce annual carbon dioxide emissions by 750,000 tonnes a year, helping us to meet our ambitious climate targets. The regulations’ purpose is to introduce E10 as standard petrol in Northern Ireland, while ensuring that the current E5 grade remains available for those who need it. This will bring petrol grades in Northern Ireland in line with those in Great Britain, where E10 was introduced in September 2021. We have completed the notification procedures required under the Northern Ireland protocol, meaning that an introduction in Northern Ireland is now possible.

E10 allows us to cut carbon emissions from cars, motorbikes and other petrol-powered equipment in use on our roads today. This is done by simply increasing the amount of renewable fuel blended into standard petrol. It is one of very few measures available to us which has an immediate impact. E10 is a proven fuel that has been successfully introduced in Great Britain and many nations around the world to deliver carbon savings. Following the introduction of E10 in Great Britain last year, these regulations ensure that consumers are provided with a consistent petrol grade across the UK. It is worth noting that the Republic of Ireland intends to introduce E10 in January 2023.

The UK has a valuable bioethanol industry, which has already benefited from the increased demand created by the introduction of E10 in Great Britain. Following our policy announcement to introduce E10 across the UK, one large facility operator announced that it would recommence production. The domestic bioethanol industry supports high-skilled jobs and improves our energy independence, delivering on a range of government priorities such as growth and energy security.

These production facilities also play an important role in their local economy, employing hundreds of skilled workers directly and supporting thousands of jobs in the wider community. That community includes the agricultural sector, with locally grown, low-grade feed wheat used to produce ethanol. Furthermore, valuable co-products of bioethanol, such as high-protein animal feed and stored carbon dioxide used by the food industry, reduce our reliance on imports, thus increasing our domestic resilience. It is vital to support these industries as we grow our economy and progress towards net zero by 2050.

Introducing E10 is part of a wider set of measures to encourage renewable fuels. Overall, renewable fuel blending is incentivised through the renewable transport fuel obligation, or RTFO, obligating larger fuel suppliers to supply renewable fuels. However, the RTFO does not prescribe how to meet low-carbon fuel supply targets, nor does it require specific fuel blends; it is market driven. It is therefore necessary to introduce the obligation to supply specific fuel blends to remove market barriers. This has been proven to be successful by the introduction of first E5 and then E10 petrol in the UK, as well as B7 diesel.

We have opted for introduction in Northern Ireland in November, as fuel suppliers and retailers have made it clear that an introduction at the same time as or shortly after the change from summer to winter fuel specification is the most efficient way to introduce E10 into the fuel system.

Over 95% of petrol-powered vehicles on the road are compatible with E10 petrol, and this figure is increasing all the time. All new cars manufactured since 2011 are compatible with E10 petrol, and most cars and motorcycles manufactured since the late 1990s are also approved by manufacturers to use E10. However, some older vehicles are not cleared to use E10. That is why this instrument includes provisions to keep the current E5 petrol, which contains up to 5% ethanol, available in high-octane “super” grade.

The same set of derogations and exceptions that apply to the supply of E5 and E10 in Great Britain in case of supply issues or infrastructure constraints will apply in Northern Ireland as well. This means that very small filling stations will be exempt from having to sell E10. Additionally, if supplying petrol with the required minimum ethanol content is not feasible for short periods of time, say due to factors such as technical or supply issues, the Secretary of State for Transport can grant refineries or blending facilities temporary derogations to ensure that fuel supply is not interrupted.

We have launched a comprehensive communications campaign involving local radio, roadside posters, social media and information at forecourts. This informs motorists in Northern Ireland of the changes that will be made to petrol this autumn—subject, of course, to the approval of this instrument—and directs vehicle owners to GOV.UK, where there is an online compatibility checker so that people can see whether their car is compatible.

In proposing this statutory instrument, my department has carefully considered a balance of interests, as we did when we introduced E10 petrol in Great Britain. I beg to move.

[Baroness Randerson (LD)]

My Lords, I thank the Minister for her excellent introduction. Obviously, we welcome this statutory instrument. However, I want to use this opportunity to register my concern at the continued lack of an Executive in Northern Ireland. That is an issue that goes well beyond this. The lack of the Executive serves the people of Northern Ireland very badly indeed, condemning them to the slow lane on so many important issues. There is an example in this SI of how they are disadvantaged.

Paragraph 12.6 of the Explanatory Memorandum makes clear that the “added complexity” of supplying 95 octane E5 grade fuel to Northern Ireland while the rest of the UK has moved on to E10 grade has, not surprisingly, meant additional costs to producers. It goes on to make it clear that producers have had to provide

“separate production processes and storage.”

Paragraph 12.3 says that the costs of this have

“already been passed on to motorists in Northern Ireland”,

even though they have not been enjoying the advantages of it. They are paying the price without getting the benefits. Happily, however, this SI brings Northern Ireland in line with the rest of the UK. Presumably the SI includes any useful lessons learned from the Great Britain implementation. Maybe the Minister could tell us whether any specific issues have been incorporated as a result of this.

I have a few questions. The Minister has answered the first one; I was going to refer to the tight timescale. I see that the Government have anticipated that and have launched their information and awareness-raising campaign. There are older vehicles that are incompatible, of course, and there will continue to be supplies of the old grade of fuel for this reason. Classic cars might be the main reason for that, but petrol is not used just for cars. Indeed, the SI refers to its use for equipment. I declare an interest as the owner of what might politely be described as a classic petrol lawnmower. Does the public information campaign cover equipment in general—not just lawnmowers but other equipment—and not just cars? Putting the wrong petrol in can be quite disastrous.

These regulations impose requirements on petrol filling stations to supply certain types of fuel. They impose additional responsibilities on those filling stations, so I use this opportunity to ask the Minister whether the Government will give urgent consideration to requiring them also to provide electric vehicle charging points. They are beginning to do so on certain rare occasions in Great Britain. The faster this happens, the greater we can all reap the environmental advantages of electric vehicles. EVs now encompass 16% of the new car market. Petrol stations are losing their market relatively fast and need to adapt. I think an imposition—with a timescale, of course—would be very useful in ensuring that we make the transition as soon as possible.

Paragraph 7.12 refers to fuel terminals still

“unable to blend … ethanol into their petrol”

and gives them at least two years’ exemption. I am concerned that these still exist. We have known for a long time that this change was coming, so I thought providers would have adapted by now. Can the Minister tell us what percentage of terminals this applies to? Is it just one or two? I notice that apparently there are none identified in Northern Ireland. Are we talking about a big section of the market in the UK, or just one or two outliers?

Finally, the documentation states that most petrol sold in Northern Ireland—which itself represents 3.5% of the total UK market—comes from suppliers who also supply the rest of the UK. I assume that some of the petrol sold in Northern Ireland comes over the border from the Republic, and I would be interested to know what percentage. Are the rules and regulations that now apply in the Republic identical to those being imposed on Northern Ireland, or is there some variation at some point? Obviously, this would have implications in terms of the protocol as well as a practical implication for motorists. Having put forward those questions, I am very pleased to see this measure before us.