Barry O’Farrell reverses unleaded fuel ban

Andrew Clennell
The Daily Telegraph
January 31, 2012

PREMIER Barry O’Farrell has backflipped on his controversial ethanol policy, dumping a government ban on unleaded petrol due to begin on July 1.

The cabinet decided yesterday to dump the ban a week after the leaking of secret cabinet documents revealed that Energy Minister Chris Hartcher had tried and failed to get the ban dropped last month.

The dumping of the ban came after it was revealed Mr O’Farrell was proceeding with it despite advice to the contrary from Mr Hartcher, his department, the ACCC, the Crown Solicitor and two independent reports.

The ban on normal unleaded fuel was supposed to force petrol companies to make more E10 fuel to meet the mandate of 6 per cent of all fuel being made with ethanol.

But revelations it was to take place caused a major public outcry. The decision was the second major backdown in Mr O’Farrell’s 10 months in office after he dumped a plan to retrospectively reduce the tariff on the solar bonus scheme from 60c a kW/h to 40c a kW/h last year.

But he said last night he would be retaining the 6 per cent ethanol mandate.

He will ask the independent pricing body IPART to report on whether there was enough ethanol for petrol companies to meet the mandate. The decision spares the drivers of 800,000 vehicles, which can’t take E10, the 15c a litre extra they would have had to pay for premium unleaded from July.

Mr O’Farrell met Mr Hartcher and National Party Leader and Deputy Premier Andrew Stoner prior to the cabinet meeting with his proposal to roll over on the policy and then took the proposal to cabinet, sources said.

Mr Stoner had been a big fan of the ethanol policy.

Only last week the Premier launched a staunch defence of the policy. “Government is paid to make decisions in the best interests of the public. We believe this policy is, and that’s why the decision was made.”