Increase in duty tax on Red Diesel

Red Diesel

The Government announced at Budget 2020 that there would be some changes to which sectors are legally entitled to use red diesel and benefit from it’s low duty rate. Red diesel is a low-tax fuel that is most commonly used in the agricultural, construction, energy & power and ports & marine sectors. It is manufactured for use in off-road vehicles, machinery and generators. 

From 1st April 2022, the new legislation will enable agriculture (as well as forestry, horticulture and pisciculture), rail and for non-commercial heating (including domestic heating) sectors to continue to use red diesel, but all other sectors not named will no longer be permitted to use red diesel [1]. Therefore, for those sectors they will have to switch to the use of standard road diesel and these sectors will see an increase in their total fuel bill through the increase of 46.81 pence per litre.

Businesses who currently use red diesel will have to review their product supply and infrastructure. Our Fuel Services division provides a range of services that will help our customers make any product transitions including tank cleaning and fuel sampling analysis. To find out further information on our fuel services, please click here.

With this inevitable increase in duty tax for some sectors this could be an opportunity for your business to reduce its risk around future fuel storage by using a FAME free fuel. Hydrotreated Vegetable Oil (HVO) is a fossil-free, low carbon drop-in diesel replacement product made from 100% renewable waste, residues, and vegetable oils. As HVO has no FAME content, it significantly reduces risk of microbial growth and water ingress that standard diesel products can be susceptible to. HVO also allows users to reduce greenhouse gas emissions by up to 90% in addition to sizeable reductions in tailpipe emissions providing huge environmental benefits for it’s users.

To find out further benefits of switching to HVO, please click here or contact us by email:


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