The Resource Management Association Scotland (RMAS) has warned that plans to end a 'red diesel' exemption for several industries will further impact the cost of living crisis.
Scotland’s resource management organisation representing small to medium-sized enterprises (SMEs) said that fuel price increases will drive up the costs for its members, with the brunt being borne by consumers.
It also stated that the ban on companies using the subsidised fuel could drive up the costs of recycling and might lead to increased criminal activity from unscrupulous operators.
The UK Government’s proposals, due to come into effect in April, will result in a ban on the use of lowered-taxed red diesel in mobile, static and process plants and equipment for a number of industries.
Waste management, construction and mining companies will be among the sectors impacted, while agriculture, horticulture, fish farming and forestry sector operators will be exempt from the new rules.
The RMAS argued that the lack of any viable alternatives will leave most waste and resource management companies reliant on white diesel, which will significantly increase operating costs.
A poll of the organisation’s 72 member companies suggested that costs will rise by around 15%, with companies facing additional fuel expenses of between £100,000 and £400,000 per year.
The organisation argued that this could also have a detrimental impact on the environment as more illegal operators seek to undercut compliant businesses, leading to increased incidences of fly-tipping and other forms of illegal waste dumping.
The RMAS is calling for a re-think of the policy, urging ministers to delay the ban or provide additional support for the waste management sector, which was excluded from the UK Government’s £40m red diesel replacement competition announced last summer.
Brian Ritchie, chair of the RMAS, said: “The ban comes with good intentions, but it’s ill-conceived, with no suitable green fuel alternatives available at present.
“We call on the UK Government to re-think this flawed policy and either delay its implementation or provide additional support to offset its impact on the waste management sector and avoid the economic and environmental consequences that will inevitably follow.”
Robin Stevenson, managing director at Hamilton Waste & Recycling, said: “The forthcoming red diesel ban is being billed as a ‘green tax’, but it has the potential to be quite the opposite.
“Currently there aren’t viable alternatives to the diesel plant and machinery we rely on to transport, process and recycle waste on site - as a result, the only possible outcome is that this tax will increase the cost of recycling and therefore make it less appealing to waste producers.
“Our business is already 100% carbon neutral so this blunt form of taxation is only going to damage our ability to recover vital resources and unlock their environmental and commercial value.”
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