Distribution trade association is lobbying Chancellor Philip Hammond to retain fuel duty as it argues for gradual shift to cleaner alternatives to mobile cooling technology
The Food Storage and Distribution Federation (FSDF) is calling on Chancellor Philip Hammond to avoid introducing any measures in next week’s Budget that would drastically prohibit the ongoing use of red diesel, claiming limited alternatives currently exist to fuel refrigerated vehicles.
Government earlier this year announced a review of fuel duty rates and how they can impact uptake of more innovative approaches to refrigerated transportation in the food supply chain as part of the UK’s Clear Air Strategy.
FSDF chief executive Shane Brennan has argued that the potential of additional costs for red diesel, which is also known as rebated gas oil, risked hiking the price for industry to distribute food. He said the organisation backed a more gradual shift away from diesel use, even as the government considers emerging greener approaches being used across European retail to distribute refrigerated food.
Mr Brennan said, “We understand the pressing need to find alternatives to diesel and meet vital air quality objectives, but simply removing red diesel is not that answer.”
“We share the ambition to drive take up of alternatives technology in on-vehicle refrigeration. However, a sudden cost hike will not achieve this. In fact, adding £100m to operating costs will mean less money is available for operators to change vehicles and invest in non-diesel alternatives.”
The FSDF said it expected this year’s Budget to address a recent government consultation concerning the use of red diesel in non-motor mobile machinery, which would include refrigeration trucks.
Mr Brennan, “We are keen to work with government on a holistic strategy, that sees the use of red diesel phased in a realistic timeframe, alongside a clear plan for supporting the development and take up of market-ready, reliable alternatives to the diesel-powered fridges”.
The calls have been made after the government earlier this year sought evidence for a review of how fuel duty rates such as the £2.4bn non-road diesel rebate may be impacting efforts to push the market towards cleaner alternatives to red diesel for refrigerated transport.
The call for evidence closed in August and followed the release of a draft Clean Air Strategy that noted a number of potential alternative cooling technologies for mobile refrigeration. These included Sainsbury’s attempts to implement a refrigerated delivery truck that makes use of a liquid nitrogen powered engine to curb emissions. The project has been undertaken as part of ongoing trials of technology across Europe provided by Dearman to improve supply chain efficiency of cooling.
Other examples of potential innovation in the built environment given in the report include a project undertaken by an organisation called EarthSave that aims to curb environmental impacts and improve performance within energy-intensive sectors.