New petrol rules fuel SA car­mak­ers’ fire

The Times (South Africa) - - BUSINESS - JAN-JAN JOU­BERT — TMG Dig­i­tal/The Times

THE gov­ern­ment and South Africa’s ve­hi­cle man­u­fac­tur­ers are headed for a show­down over pro­posed new fuel reg­u­la­tions that could make both cars and fuel more ex­pen­sive.

The Depart­ment of En­ergy stands ac­cused of putting South Africans’ lives at risk by not meet­ing global stan­dards for clean fuel and of sab­o­tag­ing the com­pet­i­tive­ness of the car man­u­fac­tur­ing in­dus­try.

In a strongly worded let­ter to the depart­ment‚ the Na­tional As­so­ci­a­tion of Au­to­mo­bile Man­u­fac­tur­ers of SA pro­claimed it­self “in­cred­u­lous” at draft reg­u­la­tions pub­lished by En­ergy Min­is­ter Tina Joe­mat-Pet­ters­son.

Naamsa di­rec­tor Nico Ver­meulen said the new reg­u­la­tions opened the door for the man­ganese con­tent of lo­cal fuel to in­crease‚ mean­ing worse pol­lu­tion from fuel emis­sions.

He said that if the draft reg­u­la­tions were en­acted‚ it would mean that lo­cal fuel would not con­form to Euro­pean stan­dards.

This also means South African car man­u­fac­tur­ers must as­sem­ble two ver­sions of each model — one built to han­dle lo­cal fuel‚ and an­other built to Euro­pean stan­dards‚ where clean fuel is used.

Such du­pli­ca­tion would cost the coun­try’s econ­omy and was un­nec­es­sary‚ Naamsa ar­gued.

“The gov­ern­ment is drag­ging its heels. The ini­tial dead­line for clean fuel in South Africa was 2017. Now we will be lucky if it is 2022‚” said Ver­meulen.

But the en­ergy depart­ment’s deputy di­rec­tor-gen­eral: plan­ning and pol­icy‚ Ompi Aphane‚ said the gov­ern­ment was keep­ing an open mind and would fi­nalise the process only by March.

He also said the dif­fer­ences in opin­ion in the oil sec­tor on the ex­tent to which man­ganese as an oc­tane booster should be added to fuel‚ meant the depart­ment was con­sid­er­ing widen­ing its con­sul­ta­tion from a closed reg­u­la­tory process to pub­lic participation.

“We will take into con­sid­er­a­tion the in­puts and in­ter­ests of the oil sec­tor‚ the car man­u­fac­tur­ing sec­tor‚ the man­ganese sec­tor‚ health and en­vi­ron­ment is­sues‚ as well as the added cost to the con­sumer if we im­ple­ment Euro­pean fuel stan­dards ... sig­nif­i­cant cap­i­tal in­vest­ment in re­finer­ies would be fi­nanced by a higher con­sumer fuel price‚” said Aphane.

“In the end‚ we will take the de­ci­sion which is best for the coun­try‚ ob­vi­ously tak­ing into ac­count the im­pact on the ex­port mar­ket.”

DA en­ergy spokesman Gor­don Mackay said the is­sue of cleaner fu­els had barely re­ceived at­ten­tion from par­lia­ment as a re­sult of the cur­rent ad­min­is­tra­tion’s ob­ses­sion with push­ing through the nu­clear deal.

“Oil com­pa­nies and the gov­ern­ment refuse to pay for up­grades to re­finer­ies to en­sure cleaner fu­els‚ mean­ing that at some point con­sumers will carry the cost‚” he said.

‘ Open door for the man­ganese con­tent of lo­cal fuel to in­crease

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