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Prepare for the switch from red to white diesel

28th October 2021
Red Diesel

From 1st April 2022 businesses using ‘red diesel’ will have to make the switch to more expensive ‘white diesel’ under new government legislation.

Red diesel is used widely in the agricultural, construction and manufacturing industries for off-road vehicles and plant. It is cheaper to buy than the more commonly used white diesel used by on-road vehicles because the there is a rebate on the duty bringing it down to 11.14%. The new rules will require users to buy white diesel on which a 57.95% duty is levied.

Red diesel accounts for 15% of all the diesel used in the UK and creates 14 million tonnes of CO2 per year. Research found that construction and infrastructure building also contributed 7% of nitrogen oxide emissions and 8% of PM10 (a type of particulate matter) through its use of red diesel in London in 2018.

The new legislation is intended to encourage red diesel users to adopt more sustainable methods of working or use less fuel as part of the government’s strategy to reduce all greenhouse gas emissions to net zero by 2050, to end global warming.

Nick Boulton, chief executive of the TRA said: “These new rules will have an impact on members who will have to switch to fuel which is currently 47p per litre more. The new rules will restrict the number of applications for a tax rebate and will mean construction, manufacturing, and port facilities will no longer be allowed to use red diesel in their forklifts, side-loaders, and telehandlers.

“However, we would urge the government to look at the final implementation date of this legislation. More sustainable equipment for the handling of large-scale wood products such as electric side loaders or electric forklifts above 10,000kg capacity are only just becoming available. Given the current waiting lists for all plant and machinery, it is unlikely that most manufacturers will be able to access these sustainable alternatives before the tax is imposed next April.”

We urge members to read the full policy outline here as well as this useful preparation guide.

The TRA is lobbying, with other trade associations, to get the Red Diesel deadline extended and we would ask for your support by sending the letter below to your MP.

Copy and paste the text below to support our campaign:

Click here to find your MP and how to contact them

MP’s ADDRESS HERE

DATE

Dear

End of the red diesel subsidy

I am writing to you regarding the end of the subsidy for red diesel.

We are extremely concerned about the impact of these changes. At a time when we are facing huge inflation in areas including energy, labour and fuels, the removal of these support measures causes significant additional pressure on our business.

As a wooden trussed rafter manufacturing company, we are extremely supportive of the government’s initiatives to meet climate change and environmental targets and as an industry have made significant inroads into upgrading our vehicles, including trucks and forklifts, to electric fleets. However, due to the size and weight of the products in our supply chain, most companies still use red diesel, and it may be several years before the vehicles we need to replace our fleets are available.

We are asking that the government retains the subsidy for red diesel, at least while highly challenging market conditions remain. Our trade association, the Trussed Rafter Association along with a number of other trade associations including the Timber Packaging & Pallet Confederation (TIMCON) have suggested a phased withdrawal. This would be over a longer timescale, possibly three years of financial support, to help us and those in our supply chain such as wood importers, ports, and logistics companies with the transition to new heavy-duty equipment which is only just starting to become available in many sectors.

Trussed Rafters made from wood are essential products in the future of sustainable low carbon housing in the UK. We are asking for your support and urgent action to ensure that they continue to play their key role smoothly and prices for our goods to our customers are kept as low as possible.

Together we can protect the environment AND avoid additional costs being added to end consumers further along the supply chain.

Yours sincerely

NAME and COMPANY

 

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Trussed Rafter Association