Removal of sector’s entitlement to red diesel is nothing more than a stealth tax
The British Metals Recycling Association is calling on the Treasury Department to accept that the removal of the sector’s entitlement to use red diesel is tantamount to a stealth tax given cleaner equipment, which is fit-for-purpose, does not yet exist.
The BMRA believes that the Treasury’s insistence that the move is meant to incentivise the switch to “cleaner alternatives” is illogical on so many levels. Firstly, if the move was purely about reducing emissions, then simply removing the sector’s entitlement to use red diesel will not achieve this because plant powered by cleaner alternatives to diesel cannot be used safely and effectively in a hostile environment such as on a metal recycling site.
Currently, electric alternatives need to be physically plugged into a power supply. This means ‘mobile’ plant either cannot move or it has to trail high voltage cables behind it – not practical on a busy site that deals with metals with sharp edges.
Moreover, the BMRA was very clear with Treasury that over 30% of metal recyclers are not connected to the grid or, if they are, they cannot draw enough power to operative large pieces of plant such as shears and fragmentisers.
When it comes to Treasury’s aim to bring about parity with other “road users” the BMRA contests that, unlike farming equipment, metal recycling plant and equipment does not use the road; it is necessarily site based.
While the sector fully supports the Government’s drive to improve air quality, the BMRA is calling on the Government to recognise the role that metals recycling plays in protecting the environment.
“The removal of this sector’s red diesel entitlement before alternative plant and equipment exist, could devastate the metals recycling industry. The knock-on effects would impact both the UK economy and could lead to deep ramifications for the environmental landscape across the UK,” commented James Kelly, CEO of the BMRA.
“Put simply, if the cost of processing outstrips the value of the metals, then the UK could face a situation where businesses turn away items such as end-of-life vehicles and waste electrical and electronic devices because it is not worth taking them in. In addition, the cost of processing materials could see end users, such as the UK steel industry, facing significant price increases.”
To secure the future of metals recycling in the UK, to reduce potential environmental harms and to stop local councils having to pay clean-up costs, we are therefore asking the Government to a) give the sector more time to transition away from red diesel and b) consider setting up a grants scheme to enable operators to invest in new technologies.