Calls To Incentivise The Fuel Rebate Scheme

Haulage workis always changing, with new technologies, competition and government regulations all driving innovation. Recently, special pressure has come from increased concerns over climate crisis. While these challenges must be met, solutions cannot be at the expense of the transport sector and those who work in it.

In this article, we’ll cover the Irish Road Haulage Association (IRHA)’s concerns over the Climate Action Plan (CAP) 2019, focusing especially on their calls for incentives to help businesses and consumers switch to lower-carbon alternatives.

The Climate Action Plan

Published by Minister Richard Bruton, the CAP was built up before its release as an ambitious plan. Ireland has long lagged behind other countries on environmental issues, and the CAP was presented as a means to kickstart the country’s engagement with climate concerns.

The released version, however, is more conservative than that, containing mostly minor adjustments – but it has big implications in key areas concerning haulage work. With a major push for alternative, lower and zero-carbon fuels, the CAP cites an Economic and Social Research Institute paper to argue for a carbon tax.

The Issue

Of course, the plan avoids mentioning another major conclusion of that same paper: that carbon taxes do reduce emissions, but do so at the cost of being an extremely regressive form of taxation, hitting vulnerable individuals and sectors especially hard.

The potential effects on haulage work seem to have also gone unconsidered. Making fuel significantly more expensive without helping companies adapt could undermine the workings of the entire transport sector – with potentially disastrous consequences for the wider economy.

The IHRA Response  

The reaction from those involved in haulage workhas been even-handed but firm. IRHA president Verona Murphy noted that the plan clearly aims to ‘nudge people and businesses towards electric vehicles and other alternatives to diesel’, but that it didn’t take into account the fact that there is at present ‘no readily available alternative’ – ‘and there won’t be for decades to come’.

Luckily, Murphy also notes that there is a viable solution to the issue. ‘Euro 6’, the most recent EU standard for low emissions vehicles, provides a means to retain diesel while providing ‘the most cost effective, carbon and energy efficient’ HGVs possible. Indeed, Euro 6 is so environmentally friendly that it even meets the stringent standards of London’s new ultra-low emissions zone (ULEZ).

The Argument for a Fuel Rebate

Still, even a mass switch to Euro 6 would require those involved in haulage workto take the costly step of updating their entire fleets. For this to occur, Murphy argues, the sector must have ‘the confidence to invest’. This confidence would come from a clear government statement that ‘prices will be stabilised for essential users’ such as coach and HGV operators.

This would be achieved by extending the Accelerated Capital Allowance (ACA) to cover investment in Euro 6 vehicles, rather than only those that use alternative fuels.

Continuing, she was clear on the consequences of not supporting logistics operators. ‘If the price of diesel increases for hauliers because of the unthinking, misinformed narrative that all diesel vehicles are bad’, she said, ‘older, less efficient trucks will be brought in’. In this way, failing to support Euro 6-compliant diesel vehicles could actually have the opposite effects to those intended by the CAP. Rather than a cleaner, more efficient fleet, operators would turn to cheaper, outdated alternatives.

Climate action is a necessity, of course. But it can only be successful if it works in the interests of everyone – of all individuals and businesses. With haulage workso central to the wider economy, governments would do well to listen to organisations such as the IHRA.

Author Plate

Norman Dulwich is a Correspondent for Haulage Exchange, the leading online trade network for the road transport industry. Connecting logistics professionals across the UK and Europe through their website, Haulage Exchange provides services for matching haulage work with available drivers, and is now the fastest growing Freight Exchange in the UK.