LPG & Gas bottles too

Submitted: Monday, Jun 04, 2012 at 08:23
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Have you noted that the Gillard Gov't has decided to tax LPG. Wow how clever successive governments have spent millions of our dollars convincing people & businesses to switch to LPG because it will help save our enviroment and is the best alternative to fossil fuels. Another sneaky carbpn tax? Even the Greens let this new tax through. Who can you trust?
Have you noticed the huge variance in the cost of refilling/or swap n go a 9 kg (8.5). Travelling through country NSWI had my gas bottle refilled at Manilla for $18.95, then purchased a swap n go at Coonabarabran for $25. Then had bottle refilled at Hill End $41.00 then in Bathurst/kelso IGA had them for $43 Woolworths Caltex @ $38 and Bunnings @ $21.95.
Do you get the feeling we are being ripped off?
Gas fired power stations pay leaa than 10c a litre for gas. China pays about 3c a litre. But we the people who pay these useless politicians & public servants get shafted.
Must be Monday
PeteM
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Reply By: Member - Bruce C (NSW) - Monday, Jun 04, 2012 at 08:51

Monday, Jun 04, 2012 at 08:51
Totally agree Peter, they are too smart for their own good these politicians.

Julia blew any chance she had of credability when she did the high five with Swan in parliament when the carbon tax bill passed through.

LPG for vehicle is nudging $1.00 a litre and at that price it is totally unviable as an alternate fuel source. As you say, better for the environment so one wonders why the entire commonwealth fleet is not running on gas as it would be cheaper for the Govt. and better for the environment. Have the greens gone to sleep or are have they become drunk with power.
None of them are worth voting for.

Cheers, Bruce,
At home and at ease on a track that I know not and
restless and lost on a track that I know. HL.

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Reply By: SDG - Monday, Jun 04, 2012 at 08:56

Monday, Jun 04, 2012 at 08:56
As far as I knew LPG was always going to start being taxed early this year or next depending on sources. This tax was going to increase each year.

Up until then it had no or at least very little tax.

Was not widely advertised this was going to happen, but will still be cheaper than petrol/diesel.

As for bottles they have always varied depending on region and season. Each place seems to set their own price at times.
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Reply By: olcoolone - Monday, Jun 04, 2012 at 08:59

Monday, Jun 04, 2012 at 08:59
I'm sure if you used 500000 tons of gas a year you to could buy it cheaper....

LPG is manufactured when they refine crude oil, what goes overseas or used in commercial quantities is CNG (Compressed Natural Gas) or LNG (Liquefied Natural Gas)..... these are natural occurring gasses.

LPG is made up of parts butane, propane with a few other things thrown in for good measure.

CNG and LNG are methane based.

When you get a gas bottle field you are paying a little for the LPG and the rest in handling chargers....... most businesses charge staff out at between $80 to $100 per hour, so if it takes them 15 minutes to fill your gas bottle your paying for the LPG and a $25 handling fee..... there would be other hidden costs associated with it including Haz Chem, OH&S and training.

Nobody complains that a Lt of beer is 3 times the price of a Lt. of petrol and 4 times the price of a Lt. of LPG.

Yes taxes are a funny thing.
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Follow Up By: Member - Bruce C (NSW) - Monday, Jun 04, 2012 at 09:16

Monday, Jun 04, 2012 at 09:16
olcoolone,
If we drank as much beer as fuel we consume in our vehicles you might have a point making that comparison.

Seems either way we are addicted to both beer and fossil fuels.

The tax on LPG, as you rightly point out, has been coming for many years now, but the level of tax is the issue. In six years the price of a litre of LPG has better than doubled. I can remember in 2006 I was paying 46 cents a liter in southern NSW northern Vic. Not sure what it is down there now but I'll bet it is nudging the dollar.

It has now been priced right out of the market. I have advocated LPG use for many years but there is no way I'the V8 cruiser now. It would be akin to going back to a carburetered engine as opposed to fuel injection. It is a no brainer.

Cheers, Bruce.
At home and at ease on a track that I know not and
restless and lost on a track that I know. HL.

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Follow Up By: Member - Bruce C (NSW) - Monday, Jun 04, 2012 at 09:21

Monday, Jun 04, 2012 at 09:21
Sorry about the typo,
It should have read "there is no way I'll be converting the V8 petrol cruiser now"
At home and at ease on a track that I know not and
restless and lost on a track that I know. HL.

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Follow Up By: IronMan - Monday, Jun 04, 2012 at 10:14

Monday, Jun 04, 2012 at 10:14
I also recall paying a much smaller amount. In 1999 I enlisted in the navy and was paying 19.9c/litre nearly the whole time I was at HMAS Cerberus, Victoria. It was cheaper for me to drive people to the airport for leave than for them to catch the airport bus.

Before this, I remember that petrol jumped from about 56 cpl to 75-ish cpl in the early 1990's thanks to Gulf War Mk 1. When the oil again flowed, in quantities greater than before, the price did not decrease. This happened again during Gulf War Mk 2. Once the magical 1.00/litre barrier was broken and the world did not end (although I converted my second car to LPG at that point), there was no going back ever. I believe that the issue was made worse when Coles and Wooloworths got into petrol, somewhat forcing BP to upgrade their outlets or fade away - find an independant servo in a capital city now.

The Government, no matter what creed they are, is ripping you off. The petrol companies are ripping you off - that's the multi national conglomerates, not Joe's Discount Super on the corner. There is also no correlation between distance to deliver the tanker and pricing.
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Follow Up By: Member - Bruce C (NSW) - Monday, Jun 04, 2012 at 10:50

Monday, Jun 04, 2012 at 10:50
Talking about LNG and CNG being methane based, they are carrying out experiments at the moment trying to reduce the amount of methane that cows produce by varying feed.

In the meantime we are selling methane based fuels as fast as we can get it out of the ground.

And they have the ordacity to critisize farmers for running cattle (to feed the nation) that fart and belch methane.

Something not right there.
Some fools are having us on. And they could be green in colour I think.
At home and at ease on a track that I know not and
restless and lost on a track that I know. HL.

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Follow Up By: olcoolone - Monday, Jun 04, 2012 at 13:23

Monday, Jun 04, 2012 at 13:23
When methane is burnt it produces Co2 and water, Co2 is bad for the environment but unburnt methane does far more damage.

So methane burnt is less dangerous to the environment then methane emitted from animals..... unless they can find a way to burn the methane as it leaves the animal.

The GWP (global warming potential) is calculated on chemicals, the formula used is.... the amount of heat that's trapped in one molecule of Co2 compared with the amount of heat trapped in one molecule of the other chemical.

Co2 seeing it is used as a reference chemical has a GWP unit rating of 1, methane has a GWP of 21..... meaning methane is 21 x more dangerous to the environment then Co2

R134a refrigerant that's used in most vehicles air conditioning systems has a GWP of 1300.

The government has put a price on carbon emissions at a rate of $23.00 per ton..... Co2 being 1 GWP has no carbon tax, methane has a tax rate of .021 and R134a refrigerant has a take rate of 1.3

The life expectancy of methane in the environment is about 12 years compared to C02 that has a life expectancy of around 200 years.

Welcome to science 101.....


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Follow Up By: Bazooka - Monday, Jun 04, 2012 at 22:26

Monday, Jun 04, 2012 at 22:26
LOL, way to stop a thread in its tracks Olcoolone. Facts and knowledge can be terrible things when they don't suit.

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Reply By: KevL64 - Monday, Jun 04, 2012 at 09:34

Monday, Jun 04, 2012 at 09:34
The tax/ excise on LPG was introduced by John Howard. It increases a few percent each year for a few more years yet until it reaches parity with petrol.
So, point the finger at the correct pollies. Howard and the LNP.
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Follow Up By: MrBitchi (QLD) - Monday, Jun 04, 2012 at 09:52

Monday, Jun 04, 2012 at 09:52
Incorrect. It will increase over a few years till it reaches 12.5 cents/liter by 2015, still much less than petrol.

Yes the Howard Govt introduced it.
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Follow Up By: Member - Tony V (NSW) - Monday, Jun 04, 2012 at 10:20

Monday, Jun 04, 2012 at 10:20
Just a correction, it was not John Howard, it was Peter Costello who introduced the phased in LPG tax.

That was back in the days when it was the Ministers who were in charge of their portfolios, did their jobs and the kudos was not taken by the Prime Minister and only any failures passed just to the Minister....
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Follow Up By: MrBitchi (QLD) - Monday, Jun 04, 2012 at 10:25

Monday, Jun 04, 2012 at 10:25
Technically correct, but it was the Howard govt ;)
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Follow Up By: Member - Tony V (NSW) - Monday, Jun 04, 2012 at 10:41

Monday, Jun 04, 2012 at 10:41
Yes MrBitchi, the correction was regarding KevL64's post.... :)
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Follow Up By: KevL64 - Monday, Jun 04, 2012 at 19:13

Monday, Jun 04, 2012 at 19:13
And the correction was?
John Howard / John Howard Govt, what difference does it make? John Howard was in charge.
The "tax"was not introduced by Gillard as asserted in the op. I pointed that out correctly.

Is this the most pedantic forum on the internet?
Perhaps not but must be close. I think I'll just slink off to lurker land again.

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Follow Up By: fisho64 - Tuesday, Jun 05, 2012 at 02:34

Tuesday, Jun 05, 2012 at 02:34
yep it was the Howard Gov.
But the other side of the coin is that it was also the Howard gov who removed CPI indexation of the fuel excise. Hence it is stuck at 38.123 c per litre, far less than just about any developed country I believe?
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Reply By: GT Campers - Monday, Jun 04, 2012 at 10:03

Monday, Jun 04, 2012 at 10:03
Yes the tax increases were scheduled many years ago - but the present price for LPG hurts!

I do 50+Kkm a year on LPG (EFI) with my Hilux V6 and LPG is still a far cheaper way to drive
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Reply By: Member - Bruce C (NSW) - Monday, Jun 04, 2012 at 10:44

Monday, Jun 04, 2012 at 10:44
Ironman,
I agree, The fuel pricing problem is not the fault of the local fuel seller. He/she is as much of a hostage in these circumstances as the people they sells to.

At around 5 cents per litre margin these guys are not doing all that well unless they have a big turnover. By the time you take into account rent on the service station, or rates etc if they are the owners, local and federal govt. charges etc. etc, the list goes on and on, there is not much left over to cover wages etc..

So the next time anyone is thinking about ripping it up some poor coot behind the counter, think, that poor bugger is probably even worse off than you because they cannot winge to anybody and they are probably getting less money than most.

Cheers, Bruce
At home and at ease on a track that I know not and
restless and lost on a track that I know. HL.

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Reply By: racinrob - Monday, Jun 04, 2012 at 12:23

Monday, Jun 04, 2012 at 12:23
G'day Peter, a couple of Saturdays ago I came thru Roma, no one would refill a 9kg bottle so I had to accept a Swap-N-Go at $38, at least the attendant gave me the keys to the cage and I could pick a newish bottle to replace my near new one. Shafted is right.

rr
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Reply By: Ron N - Monday, Jun 04, 2012 at 12:43

Monday, Jun 04, 2012 at 12:43
Once again, a post started and inflamed by ill-informed ranters who can't even do their research properly before they post.

The INTENTION for a road tax on LPG for road use was introduced in the 2003/2004 by Peter Costello, and was a move by the Howard Govt to ensure that road users of LPG "made their proper contribution" to road upkeep, via road taxes.

The road tax on LPG was not LEGISLATED until May 2011. Four bills were introduced under the current Labor Govt to apply road tax to LPG, LNG, and CNG (that are used in transport).
These bills were approved and passed, and are now law.
There were no objections to the taxing of alternative fuels by the Liberal Party, as it was INITIATED by the Liberal Party.

http://www.ato.gov.au/taxprofessionals/content.aspx?doc=/content/00244543.htm

The LPG tax commenced at 2.5c per litre in December 2011, goes to 5c per litre in July 2012, and increases 2.5c per litre every 6 mths thereafter, until it reaches 12.5c a litre on 1st July 2015.

There's a very interesting factor coming out of this. The tax is only applied to LPG used in road use. Tax-free LPG is still available for forklift use, and for domestic use - and when LPG is delivered in road tankers, it is invoiced in two separate invoices - one for taxed fuel going into tanks supplying Auto LPG, and one for untaxed LPG going into tanks supplying domestic gas.

Here's the kicker. It is illegal (from 1st December 2011) to use domestic LPG in road vehicles or to sell untaxed LPG as Auto LPG. Severe penalties apply for avoiding road taxes.

http://www.ato.gov.au/content/00298947.htm

The kick in the nuts for the Govt here, is that there is no way of knowing if someone using LPG, isn't buying (untaxed) domestic LPG, and then transferring the domestic LPG into their vehicle tanks! (easy to do).
The liquid fuels can have dye added to enable tax inspectors to check on whether the fuel is taxed or untaxed (there's huge penalties in the U.K. and U.S. for those found with undyed or untaxed fuel in their vehicles fuel tanks) - but how can taxed or untaxed LPG be indentified??
I can see a lot of people using domestic LPG in vehicles, very shortly.

The LPG market in Australia is very complex, and involves a lot of horse trading. LPG is both exported and imported. The amounts of local propane and butane available often alter substantially, because both are sourced from Natural Gas (LNG) as by-products of the refining of LNG - and they are also sourced as by-products of oil refining.

When there is a shortfall in local supply of LPG, or an increase in local LPG demand, LPG is imported to make up the shortfall. It's not a matter of just redirecting LPG from the NW Shelf processing plants, as the likes of the NW Shelf partners have contracts for export LPG to fulfill, as well as LNG.

The wholesale price of LPG in Australia is basically set by the Saudis, who essentially control world LPG prices, via the Saudi Aramco Contract Price - which is set on the first day of every month, and which stays at that price for the entire month.

http://www.raa.com.au/page.aspx?TerID=1144
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Follow Up By: Member - Bruce C (NSW) - Monday, Jun 04, 2012 at 18:01

Monday, Jun 04, 2012 at 18:01
Hi Ron.

From what you say it is clear that the current increases in LPG prices have nothing to do with tax increases as it can only account for a max 12.5 cents and that is not until 2015. currently at 15 cents from inception in July 2011

As you say "Horseplay" is the reason.

Cheers, Bruce.
At home and at ease on a track that I know not and
restless and lost on a track that I know. HL.

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Reply By: pmacks - Monday, Jun 04, 2012 at 15:30

Monday, Jun 04, 2012 at 15:30
Ah TAX on fuel

the never ending debate !!! and nothing we can do about it !!

What annoys me more however is every time i put fuel in the boat ( and we can easily use 100-150 lts a day ) i still have to pay ROAD TAX levies, yep i know i tow the boat on a trailer on the road but that should be taken care of by my trailer rego and the tax on the fuel in my car that i use to tow it with

i should be able to buy a dedicated boat fuel from a boat shed or the like that doesn't include the road levies

OK my bitch over

peter

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Follow Up By: kev.h - Monday, Jun 04, 2012 at 17:59

Monday, Jun 04, 2012 at 17:59
Interesting point do trawler operators and commercial charter boat pay road tax ?? I bet not - when they buy their fuel at the marina my guess is no road tax on it, so i dont see why every boat cannot be exempt
opps maybe i've just alerted them maybe a water use tax now
Cheers kev
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Follow Up By: Isuzumu - Monday, Jun 04, 2012 at 19:03

Monday, Jun 04, 2012 at 19:03
Hi Kev, I believe that the rebate for trawlers has been lowered and when I run charter boats there was not much in the rebate, that's a while back. But the big thing here is, in refuelling at a marina is the cost of diesel is a lot higher than at the servo, they say some thing to do with an environmental tax or some c""p but we paid around 10 cpl more than up at their servo two hundred metres away.
Cheers Bruce
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Reply By: Member - Peter M (QLD) - Monday, Jun 04, 2012 at 16:46

Monday, Jun 04, 2012 at 16:46
Oh what a can of worms I opened up.
I'm sorry I didn't do my research more carefully, thank you for doing it for me.
Maybe I should have questioned the high cost of fuel & LPG in country Australia.
I know cities like Melbourne & Sydney have the population and deserve to have some advantages over the country people who don't have bumper to bumper traffic & smog but have to pay a huge freight compnent (+ GST) on every thing they buy.
When I was a lad (a long time ago) there was an equel priceing policy on fuel but unfortunately that meant the major population centres were paying a fee to other Australians. So that had to go too.
Anyway you all have a great day, now you hear.
Stay safe & stay happy
PeteM
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Follow Up By: Ron N - Monday, Jun 04, 2012 at 18:55

Monday, Jun 04, 2012 at 18:55
Peter - There's a number of factors that make remote areas LPG much more expensive than petrol in the same area.

One factor is simply lack of competition. Because the LPG market is relatively small, there's only about 3 or 4 LPG wholesale suppliers. In the remote areas, there's usually only one LPG supplier, they can charge what they like.

Two - the cost of LPG handling equipment - tankers, tanks, dispensing installations - is considerably higher than petrol handling equipment. Tankers are certified pressure vessels, and considerable additional restrictions, rules and regulations apply to LPG handling and storage.

Three - the amount of equipment needed to handle LPG is enormous. Ever considered how many gas bottles are in use? Every one of them is an expensive tank, needs to be certified and regularly checked and re-certified or discarded. A lot are owned by the LPG companies.

The last factor is probably the important one you mentioned. The fuel subsidy schemes for remote areas have gradually been phased out, and the last version, the Petroleum Products Freight Subsidy Scheme, was phased out in 2007.

This has invariably had an impact on fuel prices in remote areas - and oil and gas companies aren't slow to make sure that they get well rewarded for transporting fuels to those areas.

Previous inquiries into fuel pricing and fuel taxation (2001) - http://fueltaxinquiry.treasury.gov.au/content/backgnd/download/001.pdf

The last inquiry into petrol pricing (2007) takes up 280 pages - with the inevitable Govt conclusion - that nothing needs to be done, and that petrol sales are quite competitive.
I'll wager they could hold a similar inquiry into LPG pricing, and after spending voluminous sums - and cutting down three major forests to get the necessary paper for the results - they'd come up with the same conclusion for LPG (insert bang-head-on-wall icon here).

http://www.accc.gov.au/content/item.phtml?itemId=806216&nodeId=d5fc6a56fb589b453abc58f22e0b78bd&fn=Petrol%20prices%20and%20Australian%20consumers%20all%20chapters.pdf

Cheers - Ron.
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