A New South Wales regulator recently released draft recommendations on a maximum wholesale price of ethanol for fuel blends like E10, proposing a price of AUD 1.35 (USD 1.04/EUR 0.93) per litre.

The Independent Pricing and Regulatory Tribunal (IPART) has been asked to regulate the price of wholesale ethanol to support the supply of E10 at an attractive price to customers. This was one of the measures announced by the NSW government in late 2015 designed to improve the state’s performance against its mandate requiring that ethanol accounts for 6% of the petrol volumes sold by major fuel sellers. Currently, the percentage is 2.5%, according to the draft report.

The recommended maximum price is higher than current prices in contracts between ethanol producers and fuel wholesalers. IPART admitted that some might have expected it would need to be much lower to ensure E10 is offered at an attractive price. “However, there is a risk that recommending a much lower maximum price at this time may not support a sustainable biofuels industry in NSW,” the regulator added in its report.

“As E10 competes with regular and premium petrol, we expect market prices will remain below our recommended maximum,” IPART chair Peter Boxall said in a statement.

A final report is due by the end of December.


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