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One of Australia’s largest proposed coal projects could absorb more in diesel tax exemptions in its lifetime than the initial sum sunk into its construction, environmental groups say. About $44 million a year would be rebated to Whitehaven for its Winchester South coal mine under the fuel tax credit scheme, which is facing renewed scrutiny for its drag on public finances and decarbonisation goals. Read more

CEF’s new report on Diesel Fuel Rebate subsidy reform “Transition Tax Incentive: Reforming Fuel Tax Credits into a Decarbonisation Tailwind”. A policy proposal to phase-out the fuel tax credit scheme for its largest beneficiaries with a transition tax incentive scheme to accelerate electrification and decarbonisation. Since the Fuel Tax Act 2006 (starting FY07), the FTC Scheme has provided $123bn in diesel subsidies to FY25. Beyond this, by FY30, it will have provided $184bn in subsidies. Read more

Climate Energy Finance Director Tim Buckley has called for reform of Australia’s diesel fuel subsidy. This comes as business groups have expressed concern following Labor’s economic reform roundtable. “What we have called for is a $50 million per company, per annum cap to the diesel fuel rebate,” Mr Buckley told Sky News Australia. “Not one farmer, not one truck driver, not one small or medium-sized enterprise will be affected; it only affects the 15 largest mining companies in Australia.” Read more

CEF proposes that companies be required to reinvest any fuel tax credits above a $50 million annual cap into clean energy diesel alternatives, or forgo these credits (top FTC recipient companies currently claim hundreds of millions of dollars in credits annually). Fortescue, a major beneficiary of fuel tax credits, fully supports our proposal. This year alone, the scheme — a top 20 budget expense — is costing the public purse $11 billion, and this will climb to more than $13 billion a year by decade’s end. Republished from Renew Economy Read more

A Climate Energy Finance report circulated to key Labor ministers and members of the crossbench recommends a $50 million cap on the fuel tax subsidy, with big miners forced to spend any cash they claim beyond that on green energy alternatives. Federal Resources Minister Madeleine King has indicated the government has little appetite to overhaul the fuel subsidy, though at least one major Australian miner has voiced concerns behind closed doors over the implications of an ongoing campaign by green groups to reform the tax. Read more

If Australia is serious about its climate commitments, fiscal sustainability and our generational opportunity to lead as a green energy and exports superpower, this handout that pays polluters to pollute is overdue for substantive reform. CEF proposes that companies be required to reinvest any fuel tax credits above a $50 million annual cap into clean energy diesel alternatives, or forgo these credits (top FTC recipient companies currently claim hundreds of millions of dollars in credits annually). Fortescue, a major beneficiary of fuel tax credits, fully supports our proposal. This year alone, the scheme – a top 20 budget expense – is costing the public purse $11 billion, and this will climb to over $13 billion a year by decade’s end. Read more

Australia is being urged to put a $50 million cap on industry subsidies for diesel fuel, and turn the scheme into a “transition tax incentive” to encourage renewable energy investments. Climate Energy Finance issued the recommendations in an analysis of Australia’s Fuel Tax Credit Scheme on Wednesday. It says the scheme costs taxpayers $11 billion a year while discouraging firms from investing in environmentally friendly projects. The reforms, which would mostly affect large mining companies, have been endorsed by Fortescue Metals. Read more