Red Diesel Rules Change
The use of red diesel and other rebated fuels is changing.
From April 2022, only certain vehicles will be able to use rebated fuel under limited circumstances. This will inevitably mean that some customers will no longer be able to do so.
Allowed Usage
The use of rebated fuel will be allowed only in vehicles, vessels and other machines being used for:
- agriculture,horticulture, fish farming, forestry, and certain associated activities
- rail transport
- heating and electricity generation for premises used only for non-commercial purposes
- maintaining the golf courses or community amateur sports clubs
- sailing, boating and marine transport
- powering equipment used by travelling fairs and circuses
Who Will It Affect?
Red diesel is used mainly for off-road purposes. It’s currently used to power bulldozers and cranes used in the construction industry, or to power drills for oil extraction. It accounts for around 15% of all the diesel used in the UK and is responsible for the production of nearly 14 million tonnes of carbon dioxide a year.
Red diesel used in the construction and infrastructure building sectors was also estimated to have produced:
- 7% of nitrogen oxide emissions
- 8% of PM10 emissions (a type of particulate matter)
in London in 2018.
What is Red Diesel?
“Red diesel” is the term used for gas oil that is intended for use other than as fuel in road vehicles. Since 1961, there has been a requirement for it to be marked with a red dye (as well as chemical markers) to prevent its misuse in road vehicles.
Why is the Law Changing?
In June 2019, the UK began introducing measures to reduce emissions to net zero by 2050. The laws enacted would guarantee that the UK would no longer contribute to global greenhouse gas emissions and also limit the threat posed to the UK public from air pollution.
In the 2020 Budget, an announcement was made to remove the entitlement to use red diesel and rebated biodiesel from most sectors as of April 2022 to help meet its objectives.
From April 2022, the tax changes will ensure that most users of red diesel use fuel taxed at the standard rate for diesel. This tax rate fairly reflects the harmful impact of the emissions they produce.
Through this change, the government hopes to incentivise investment in cleaner alternatives and economical use of equipment.
The Law on Non-Sanctioned Use
It is illegal to use rebated fuel in a vehicle, vessel or machine that is not allowed to use it.
If you are caught:
- you risk having your vehicle or machine seized
- you’ll have to pay back the money you owe
- it could lead to prosecution
Useful Links
To read the official guidance click here – https://www.gov.uk/government/publications/reform-of-red-diesel-entitlements/reform-of-red-diesel-and-other-rebated-fuels-entitlement
Red Diesel Rules Change