Carbon Charge Will Boost LPG Sales

4/05/05

Carbon charge will boost LPG sales

The LPG industry has welcomed Government's confirmation of the carbon charge, saying it removes uncertainty in fuel markets and will encourage wider use of lower emission fuels, such as LPG, in industrial, residential and transport sectors.

"Government has already exempted cleaner-burning LPG from a number of fuel tax increases in recent years and the market has responded very positively to those price signals. Interest in LPG has grown every time," LPG Association executive director, Peter Gilbert, said.

"We expect a similar effect, but on a wider scale, when the carbon charge is introduced in 2007.

"It will be another strong price signal which demonstrates to consumers that LPG is one of the more environmentally-friendly options."

Mr Gilbert said LPG is already a preferred fuel for environmental reasons, particularly in the South Island where it is used to combat both greenhouse gas and local air quality problems resulting from the traditional use of higher carbon heating fuels and energy sources.

Its reduced environmental impact is a key factor in the rapid growth of New Zealand's LPG market - sales have risen over 50 percent in the last five years, making LPG a sizeable and growing displacer of electricity demand.

"The carbon charge will make LPG an even more attractive option for commercial and industrial users, householders and motorists."

The Government has yet to announce how it will use the carbon charge proceeds, but Mr Gilbert called for the tax take to be applied to market education and awareness initiatives.

"More effort must be made to educate consumers about environmentally-friendly and energy efficient fuel options, and Government should actively promote and encourage cleaner-burning energy choices."

ENDS

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