The price of fuel has been in the news a lot lately with the ongoing crisis in the Middle East and its on again off again closures of the Strait of Hormuz creating instability in global oil markets and now the Independent Pricing and Regulatory Tribunal (IPART) is looking at what influences motorist’s decisions in selecting fuel grades. A focus of this review is the state’s E10 fuel market and IPART is seeking feedback from motorists on what influences their decisions to use different fuels, including E10. E10 is a widely available petrol blend of 9 to 10 per cent ethanol and around 90 per cent regular unleaded U91 petrol. IPART member Jonathan Coppel said the review is examining the factors influencing E10 sales and the operation of the ethanol market in NSW. Our preliminary findings suggest that E10 continues to be the lowest-priced fuel option for consumers, however recent market data suggests that the cost of supplying E10 has increased relative to regular unleaded petrol,” Mr Coppel said. "We are seeking feedback on the reasons for these trends, including the factors that influence consumer demand for E10, and the commercial and operational considerations involved in producing, wholesaling and retailing it. “We are also interested in understanding whether recent developments in global fuel markets, including disruptions associated with conflict in the Middle East, are affecting ethanol and E10 market outcomes in NSW.” IPART also determines a reasonable wholesale price for ethanol under the NSW biofuels framework. As ethanol is a key input into E10, ethanol prices can influence the cost of supplying E10. IPART’s determined price may be taken into account when the NSW government considers applications for exemptions from requirements to meet ethanol sales volumes under the Biofuels Act 2007,” Mr Coppel said. “As part of this review, IPART is seeking stakeholder feedback on whether IPART’s determined price has influenced wholesale and retail pricing outcomes, and whether its current pricing approach remains appropriate. "We are interested in what role, if any, the determined price plays in commercial decisions across the supply chain. We also want to understand whether changes to the determined price could affect negotiated ethanol prices and E10 prices.” Submissions on IPART’s consultation paper can be made until 30 September. More information, including the consultation paper and details on how to make a submission, is available on IPART's website.
