The Federal Chamber of Automotive Industries (FCAI), the peak industry body representing domestic and international vehicle manufacturers, said that it considered emerging fuels such as biodiesel and ethanol as “fringe fuels” without the production capacity or distribution channels to effectively meet Australia’s fuel requirements, even at blends of only 10 percent.
FCAI chief executive Peter Sturrock said that even if the immature ethanol industry was able to overcome the problems of production capacity, supply and demand, Australia’s automotive engineering standards precluded the introduction of the “flexi-fuel vehicles” that make the use of high percentage ethanol/petrol blends possible in the US.
Along with the Federal Government and major petrochemical companies, the FCAI was one of the major players in last year’s biofuels discussions, which led to Prime Minister John Howard’s September announcement that the government would support ethanol blends of up to 10 percent.
Australia’s would-be ethanol producers appreciated the public support for ethanol, with many saying it was an important step in re-educating consumers who believed that the biofuel would damage vehicle engines.
In terms of creating meaningful opportunities for an Australian ethanol industry, the statement was less promising, according to the head of Australian Ethanol Limited, Peter Anderton.
“We’re not likely to get much support as a result of those discussions,” Anderton said.
“Basically, you’re asking the petrochemical companies to give up 10 percent of their revenues, while the tax concessions for ethanol mean that the Federal Government will be losing a huge chunk of tax revenues as well,” Anderton said.
“It was a start, but we’re not expecting too much help.”
The FCAI reinforced the negative perception of ethanol as damaging to vehicle engines. Sturrock said the organisation’s position on ethanol had not changed as a result of the prime minister’s announcements last September.
“Our position hasn’t really changed from three years ago,” Sturrock said.
“Then, we said that ethanol blends of up to 10 percent were acceptable for most new vehicles and many older vehicles.
“The government’s enquiries into the matter, followed by the PM’s announcement last September saying that 10% blends of ethanol would continue to be permitted were simply restating the status quo,” Sturrock said.
Sturrock said the FCAI website (www.fcai.com.au) provided important information regarding the makes and models of cars available in Australia that could be damaged as a result of using ethanol blended petrol.
As far as Sturrock is concerned, ethanol blends of up to 85 percent will never be available in Australia, as the vehicle technology used in the US is different to the standards used in Australia, which are harmonised with European and Japanese specifications.
“We’re aware through our members, such as GM Ford or DaimlerChrysler as to what’s happening in the US, but that’s a unique situation compared to the rest of the world,” Sturrock said.
In the US, where the ethanol industry is now firmly established, automotive manufacturers have introduced new flexi-fuel vehicle (FFV) engine technologies that can determine the type of fuel in the tank and make appropriate adjustments to engine timing and electronics.
“They’re different vehicles, with different components inside them designed to make sure that there’s no engine corrosion or wear and tear,” Sturrock said.
In the US, automotive manufacturer GM Ford has made the introduction of FFVs the cornerstone of its environmental strategy, working with Chevron Technology Ventures and biofuels company Pacific Ethanol to investigate consumer response to blends such as E85 in the 1.5 million FFVs GM said it had already sold in the US.
During the Washington Auto Show last week, GM took its alternative fuel approach one step further with the unveiling of its “research vehicle”, the Ford Escape Hybrid E85, which has modified the company’s fuel cell design to include FFV technology.
The introduction of new car designs in the US is said to improve the environmental credentials of the automotive industry in addition to meeting a small but growing demand for clean car technologies, with consumers prepared to pay premium prices.
But Sturrock said that even if consumer demand for FFVs was to arise in Australia, the cars would not be made available, due to the extremely small number of FFVs likely to be sold.
“You can’t make major exceptions to vehicle engine management systems for the sake of a handful of vehicles. It’s unrealistic,” he said.
“There will not be a day in the immediate future where we had ethanol in petrol at higher than 10 percent. That would be quite a ridiculous circumstance.”
Sturrock said electric-petrol hybrid vehicles such as the Toyota Prius and a similar Honda Civic model could already meet the Australian consumer demand for premium clean vehicles, while LPG fuelled cars remained an attractive option for both new cars or fuel conversion for older models.
“There’s limited scope for the new fuel technology vehicles because of the extra costs,” he said.
“Other models are under development and will no doubt come to the market in due course, probably this year or next year. But they’re in limited numbers because of the premium cost issues.”
It was likely that FCAI members were researching other “environmentally friendly” vehicles, but hard information about new technologies would be difficult to find due to fierce competition in the market, according to Sturrock.
For now, the FCAI said new high-performance and clean petrochemical fuels scheduled for introduction to Australia in the next couple of years were a much better option for concerned Australia fuel consumers.
“It’s more likely that the improved petrol and diesel will remain the primary fuels,” Sturrock said. “There will be others, and ethanol will have a fringe opportunity no doubt, but it’s a long way from being mainstream.”
