E10 state of play

CHOICE looks at the pros and cons of biofuels such as ethanol.
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01 .Introduction


With regular unleaded petrol soon to be phased out in NSW, many drivers will have no choice about using E10 - unless they want to pay for a premium unleaded fuel. Queensland was also set to introduce an ethanol mandate for petrol, but in a last-minute reprieve, this has been suspended.

Ethanol is safe to use in most new cars, as well as older vehicles manufactured after 1986, up to a maximum concentration of 10% – which is no problem as, by law, E10 cannot have a concentration higher than 10%.

Currently, there is no uniform national framework for the introduction of biofuels, although the federal government is considering a review of existing Australian biofuel programs and policies.

Because of these pressures, CHOICE believes more consumer education about E10 petrol and vehicle compatibility is needed. We are also concerned about possible price rises when the fuel excise subsidy runs out, unless production costs can be lowered.

Is E10 suitable for all new cars?

Many new cars have an “E10 suitable” sticker on or near the fuel cap. However, there are some exceptions with certain models of cars, so always check with your vehicle manufacturer first. Some fuel-injected engines may have problems from deterioration of certain components such as seals, pipes and fuel pumps.

Check the Federal Chamber of Automotive Industries website for a list of post-1986 vehicles and motorbikes that are compatible with E10. It also details some models that aren’t suitable – for example, many pre-1986 vehicles have carburettor fuel systems that may struggle with the higher vapour pressure of ethanol, as well as steel fuel tanks that can be damaged by ethanol.

What does it cost?

Ethanol is produced by fermenting sugars from plants such as wheat, sorghum and molasses. Locally produced ethanol attracts a fuel excise rebate of 38c per litre (which matches the excise tax exactly), and this will continue until 30 June 2011. So effectively it is tax-free right now. But after this date the excise tax will be applied to ethanol (and biodiesel) on a sliding scale until it reaches half the excise on conventional fuel by 2015.

The excise rebate provides a price incentive to encourage the uptake of ethanol and E10, which has higher production costs. However, as demand increases and production expands, the costs should lower so that, when the excise rebate is reduced, it won’t mean higher prices at the bowser.

The hidden cost of ethanol

One of the downsides of ethanol is fuel consumption. Pure ethanol has less energy than petrol, so an E10 blend with 10% ethanol results in 3.5% higher fuel consumption on average. However, some motoring experts believe changes to fuel consumption depend on how the engine adapts to the different type of fuel – so any variations in consumption are likely to be different for different types of vehicles and not necessarily uniform across all cars.

According to our calculations, E10 was three cents cheaper when petrol cost $1, but now that petrol costs more and E10 isn’t 3% cheaper, you’ll end up paying slightly more – about nine cents for every 100km travelled in a Toyota Corolla for a saving of 0.4kg of CO2 per 100km.

What's happening in my state?

New South Wales is currently the only state with a government mandate for E10.

  • In NSW, the government introduced an ethanol mandate in 2007 that ensured 2% of all petrol sold had to be made up of ethanol; this will rise to 6% by 1 January 2011. From 1 July 2011, regular unleaded petrol will be phased out in favour of E10. 
  • The Queensland state government has been actively promoting E10 for several years, both for environmental benefits and to maximise opportunities for local growers and industry. Regular unleaded petrol was to be phased out by the end of 2010, but in October the government put a hold on plans to introduce a 5% ethanol mandate for petrol. According to the government, 120 million litres of ethanol fuel is currently produced in Queensland and is expected to increase in coming years.
  • Victoria does not have a government mandate to replace regular unleaded petrol with E10, but will consider it down the track. Currently it has a 5% biofuels target by 2010, which consists in large part of using biodiesel. 
  • The South Australian government does not mandate the use of ethanol in unleaded fuel. The government is monitoring developments in the petroleum industry nationwide, but has no plans to phase out unleaded petrol. In SA, none of the four major petrol companies stocks E10, but it is sold in at least 65 independent service stations. 
  • In Western Australia, there is no government mandate for the supply of E10, but it has a target of 5% for biofuels. It is examining growing grain for ethanol production and is also trialling biodiesel in some buses. 
  • In Tasmania and the Northern Territory, there are no moves to phase out regular unleaded petrol in favour of E10. 
  • The ACT does not currently have an ethanol mandate or biofuels target.

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Ethanol is one of a number of potential alternative transport fuels that include liquefied petroleum gas, biodiesel, compressed natural gas, and liquefied natural gas and shale oil.

In 2007, Australia produced 199 million litres of biofuels, including 149 million litres of ethanol and 50 million litres of biodiesel. The federal government has supported the development of alternative fuel technologies, including ethanol. It has also provided funding for research and development into new biofuel technologies, such as producing ethanol from cellulose and other materials.


  • Has a range of environmental benefits and is more sustainable in the long run.
  • The Australian Medical Association believes E10 and other biofuels can reduce deaths and ill health by improving air quality. 
  • The Australian Lung Foundation says it can reduce levels of toxins from car exhausts and greenhouse gas emissions.
  • The Australian Greens are in favour of biofuels as an important part of the solution to both the climate crisis and depleting oil reserves, but also warn of ecological risks and possible food shortages. The Greens support research and development into second-generation biofuels such as those produced from algae and lignocellulose from waste, but also want 100% carbon accounting when assessing the emissions reduction of biofuels.
  • Motoring groups such as the NRMA and Australian Automobile Association (AAA) are also generally in favour of biofuels. The NRMA believes producing transport fuels in Australia will provide a buffer against oil shortages and import costs, but argues a national education campaign is needed to raise consumer awareness about E10. The AAA, which supports the maximum 10% limit on ethanol in unleaded petrol, is concerned that, with its higher production costs, motorists could end up paying more to run their vehicles with E10. Its own study found world oil prices would have to reach $US92 per barrel before the cost of ethanol (without a subsidy) would become economically competitive with petrol. (The current cost per barrel of crude oil is about $US73.)


  • Its production uses grain needed for beef, chicken and pork production; E10 provides less fuel efficiency.
  • May damage vehicle and boat engines; imposes costs on petrol stations to install new equipment; supply of ethanol is limited and production costs are higher than for regular petrol.
  • There is a range of organisations, led by the Australian Lot Feeders Association, that oppose the mandated use of E10, arguing it will increase food prices and distort grain markets. These groups, which include some farmers, service station operators, motoring and marine groups, stock feed manufacturers and some livestock industries, have come together as the Against Ethanol Mandates Alliance to oppose the introduction of ethanol mandates by government.

Other green fuel initiatives

Ethanol produced from waste: Producing “cellulosic” or second-generation ethanol from forest ground waste and general household garbage is a more sustainable way to produce ethanol because it doesn’t put pressure on food crops. The Victorian government, together with Holden, Caltex and several engineering companies, has established a consortium to develop a process to produce ethanol from municipal waste.

New blends of ethanol-based fuels are also being developed. Caltex’s “Bio E-Flex” fuel will adjust the blend of ethanol from 70% to 85% between seasons for better engine performance, but it can only be used in certain vehicles. And new vehicles are being developed to take advantage of ethanol-blended fuels:

  • Ford has developed new V6 and V8 engines that inject pure ethanol into the engine to increase its output.
  • The Ferrari F430 Spider Biofuel runs on E85, a fuel that is blended with 85% ethanol.
  • Lotus is developing an engine known as “Omnivore” to improve fuel efficiency,
  • GM expects half of its vehicles to be running on ethanol by 2012.

Biodiesel is much the same as petroleum-based diesel but is produced from vegetable oils, animal fats and used cooking oil. Biodiesel can also be used as a neat fuel comprising 100% biodiesel. B20 is a blend of 20% biodiesel and 80% mineral diesel, while B5 uses 5% biodiesel. There is ongoing research into producing B20 from non-food crops such as algae. Biodiesel is biodegradable, and engines only require minimal modification to run it. It is cleaner burning than traditional diesel reducing emissions and improving air quality. However, similar to ethanol, pure biodiesel has lower energy content than diesel (86%), which means vehicles travel a shorter distance on the same amount of fuel.

There are currently seven biodiesel producers in Australia and the fuel itself has limited availability at this stage. The fuel excise on the biodiesel component of the product will be fully negated by a government grant until 2011.

With so many fuels now available, decoding all the letters and numbers on a petrol bowser can be a baffling exercise. Where E10 is available, there are a number of different brands you may come across when filling up your vehicle.

E10 petrol is uniformly blended with ethanol at 10% as a standard unleaded petrol, and there are also a few premium E10 fuels with higher octane ratings. A vehicle engine has an octane requirement for petrol that is expressed as a number. This refers to the ignition requirements for the engine and represents the engine’s resistance to pre-ignition.

Standard unleaded petrol is classified as “91 RON” (with RON standing for “research octane number”), which is the resistance rating for that fuel. E10 is never lower than 91 RON, but can be slightly higher at 93 RON or 94 RON, depending on how the ethanol is blended into the petrol.

Premium unleaded petrol, known as “PULP”, is not blended with ethanol and is available as 95 RON, suitable for many European cars, and 98 RON, also known as ultra premium (“UPULP”). There is a limited number of premium E10 petrols that you may be able to choose if your vehicle needs petrol with a 95 or 98 octane rating.

Otherwise, it’s not necessary to use petrol with a higher RON or octane rating for your vehicle as it won’t provide any additional power or fuel efficiency.

Some boating groups are against E10, because boat engines can be damaged if ethanol-based fuel comes into contact with water. Check with the manufacturer of other equipment, such as lawnmowers, edgers and chainsaws, about using biofuel in their motors.

E10 around the major service stations

  • BP sells E10 in NSW and Qld. Known as BP Unleaded 91, the fuel includes both cleansing and anti-corrosion agents, claims the company. 
  • Caltex sells Bio E10 Unleaded at service stations in NSW, ACT, Qld and Vic. Caltex also has a petrol called Bio E-Flex that uses 85% ethanol, available in metro service stations in Sydney, Melbourne, Brisbane, Canberra and Adelaide. It is not an E10 petrol and is only suitable for certain cars. 
  • Woolworths sells Caltex Bio E10 at service stations in NSW, Qld and ACT. It claims regular unleaded can be mixed with E10. 
  • Mobil sells Unleaded E10 in NSW, ACT and parts of Qld, but has no definite plans for expanding E10 in other states. 
  • Neumann Petroleum sells E-Gen Unleaded 95 and E-Gen Premium 98 blended with 10% ethanol in NSW and Qld. 
  • Shell sells Unleaded E10 at service stations in NSW, Qld, ACT and Vic. Shell Unleaded E10 is also available at some Coles Express service stations along the east coast of Australia. 
  • United Petroleum sells Plus ULP (95 octane fuel blended with 10% ethanol) in NSW, Qld, NT, SA and Vic. It also sells Boost 98 (98 octane with 10% ethanol) in NSW and Premium 100 (100 octane with 10% ethanol) in NSW, SA and Vic. 
  • Freedom Fuels sells E10 Unleaded 95, E10 Hi Octane 98 and E10 Premium Unleaded at service stations in NSW and Qld, and plans to expand into Vic.

Number crunch

  • E10 is available from more than 600 petrol stations around the country.
  • Australia consumed 18,900,000,000 litres of fuel in 2008.
  • E10 produces 33% less carbon emissions than regular petrol.

More information

NSW government www.biofuels.nsw.gov.au

QLD governmennt www.ethanol.qld.gov.au

Biofuels Association www.biofuelsassociation.com.au

Federal Chamber of Automotive Industries www.fcai.com.au/publications/all/all/all/3/can-my-vehicle-operate-on-ethanol-blend-petrol-

Federal Government Biofuels Information www.daff.gov.au/natural-resources/biofuelsbio-energy

Fuel prices http://motormouth.com.au

Holden/Caltext Ethanol Information www.ethanolanswers.com.au

NSW Maritime Authority informatoin on biofuels www.maritime.nsw.gov.au/rec_boating/biofuels.html

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