Silver Bullet on diesel
IN APRIL 2015, REVENUE AND HMRC INTRODUCED AN ‘UNWASHABLE’ FUEL MARKER TO DIESEL. ANNE CAMPBELL ASSESSES THE IMPACT OF ACCUTRACE TWO YEARS ON, AND FINDS IT HAS BEEN THE SILVER BULLET IN THE BATTLE AGAINST THE BANDITS.
THE war on diesel smuggling took a decisive turn with the introduction of a new fuel marker two years ago this month.
This week The Argus examines what impact the ‘Accutrace’ marker has had, and how effective it has been as a deterrent to fuel smuggling bandits.
The colourless marker which has been labelled the ‘silver bullet’ has chemical properties similar to that of diesel, rendering it resistant to conventional dye-washing and adsorption methods.
Since it’s successful introduction both north and south of the border, there has been a huge drop in the number of toxic sludge dumps which plagued north Louth.
IT is two years ago this month that custom officials North and South of the border unveiled their new weapon in the battle against fuel laundering and sludge dumping.
And what a difference 24 short months has made. From the feeling in Dundalk in 2015 that the fuel bandits were winning, despite some notable seizures, and the taxpayer was always going to be footing the huge bill for toxic sludge dumped on Louth roadsides, it is now the case that in 2016, there were 136 cubes of sludge dumped, compared to more than 430 in 2014.
For the decade previous to 2015, Louth was at the frontline of the battlefield between customs officials and the determined fuel launders, who often used the border to their advantage. Huge amounts of fuel were being laundered, mainly in the North, with the toxic sludge often being dumped on rural roads in North Louth, as well as in Monaghan.
The problems became even more marked when EU regulations introduced around 2011 dictated that all agricultural vehicles had to use low sulphur gas oil, instead of the high sulphur that had previously been easier for customs officials to detect in the fuel tanks of cars.
As the lower sulphur fuel came onto the market, it was laundered and put back out into the market as higher priced road diesel, and customs officers were having major problems in detecting it. And with the dye used to colour the agri-diesel cleaned out of the diesel already, it was one-nil to the bandits.
Revenue officials and those from their Northern counterparts at Her Majesty’s Revenue and Customs (HMRC) fought back, detecting and prosecuting the drivers using the laundered, and cheaper, fuel in their tanks, while also making some inroads into the covert world of the rurally-located oil laundries.
But laundries became mobile, often hidden in the back of lorries and driven around the countryside and pop-up petrol stations started to become the norm including a number of them popping up in Dublin and other areas south of the border.
But they needed a silver bullet to tackle the problem overall and thanks to the first Memorandum of Understanding between the two agencies, the global search for the elusive weapon to wipe out fuel laundering began.
Revenue’s Principal Officer in Indirect Taxes Division with responsibility for Excise and Mineral Oil, Niall Butler, recalls how it all started.
‘We had to deal with the marker issue and we knew we couldn’t do it on our own. We engaged with HMRC, we signed the Memorandum of Understanding in 2012 and we agreed that we would start the search for a new fuel marker that was incapable of being washed or laundered or at minimum one that would be economically unviable to launder’.
HMRC and Revenue launched a global search, challenging the world’s best scientists and companies to create something that would beat the bandits.
Mr Butler said: ‘We got around a dozen submissions from around the world. From that, the evaluation took up to 12 months which involved tests with the State Laboratory here and the Government Chemist Laboratory in the UK.
‘After all the testing and all the reports, we agreed that Accutrace was the best available’.
The Accutrace fuel marker was introduced
into fuel supplies in both jurisdictions on April 1 2015.
It’s a colourless marker whose chemical properties are similar to that of diesel, rendering it resistant to conventional dye-washing and adsorption methods, which had previously used cat litter to filter the colour out of the diesel.
And it has been a game changer. HMRC says that in the first 12 months of its introduction, ‘ there has been a reduction in the number and size of laundering plants discovered.
‘ This has been consistent with an overall shift away from illicit laundering. None of the laundering plants detected in the period (2015-16) were capable of successfully laundering the new marker.
‘No evidence has been found by HMRC or other enforcement agencies that successful laundering of the new marker has occurred’.
And while it could be, theoretically, susceptible to laundering by vacuum distillation, it is not economically viable for the launderers to do it because it requires specialist knowledge, not to mention specialist equipment and if operated on a large school it needs a large amount of energy which would make a laundry hard to conceal.
In addition, HMRC says: ‘No evidence has been found by HMRC and law enforcement agencies that successful laundering of Accutrace has occurred.
‘ This includes information from the Police Service of Northern Ireland air support who routinely search for excessive heat signatures and signs of fuel laundering activity; they have made no discoveries of criminality of this type.
‘Nonetheless HMRC takes this issue seriously and continues to keep this under close review. Over the period, there has been a reduction in the number and size of laundering plants discovered. This is consistent with an overall shift away from illicit laundering.
Mr Butler agrees with his HMRC colleagues that Accutrace has been highly effective in the battle against the fuel launderers, but stresses: ‘It is one of a number of measures that have been put in place over the past five years including dealing with unlicensed trading.
‘And 130 fuel stations, since 2011, have closed as a direct result of our intervention’. There has also been the highly successful introduction of legislation that means companies supplying marked gas oil have to provide, monthly on an electronic basis, to Revenue, information about who they have supplied the fuel to, their receipts and disposals.
There is, Mr Butler says, a 98% compliance rate. ‘We have received good support from the trade for this’.
ALL PLANTS USED OLD STYLE LAUNDERING AND THERE IS NO EVIDENCE LAUNDERING BY VACUUM DISTILLATION IS BEING UNDERTAKEN