Government of the Australian State of Victoria to co-fund demand study tied to planned Autogas conversion centres.

The plan to establish Autogas conversion centres has received support from both parties this weekend’s elections in Victoria. Large conversion centres where brand new vehicles only just offloaded from the ships would be converted to Autogas to switch more of the transport fleet to a national source of energy.

The advantage for drivers and fleet owners is that they would be able to take advantage of lower running costs thanks to excise advantages in comparison to petrol. The rate of excise on LPG will be 12.5 cents a litre by the end of 2015, compared with 38.14 cents for petrol and diesel.

The Napthine Coalition government has agreed to provide $55,000 towards a preliminary study into the proposal to see whether demand would be sufficient to justify establishment of the conversion centres. The grant, which was announced last week by the Victorian minister for manufacturing David Hodgett, mirrored an undertaking made by Labor shadow treasurer Tim Pallas.
The proponents of the scheme, the Victorian Automobile Chamber of Commerce (VACC) and Gas Energy Australia (GEA), will also help fund the study.
“This is an important milestone,” said outgoing VACC chief executive David Purchase. “The demand study will establish if the LPG vehicle production proposal has legs. “VACC, GEA and the next state government will each contribute financially to the study and it will determine, one way or the other, if the plan is sustainable. “
Apart from large conversion centres in Geelong and Adelaide, the proposal also includes the establishment of a centre of excellence for the LPG industry. The centre would conduct research and development into LPG and conversions as well as offer training services, develop production protocols and supervise accreditation and product certification.
The plan was developed in response to the forthcoming closure of all three Australian car-makers by 2017 and is designed to offer employment to some of the workers displaced in Victoria and South Australia. VACC and GEA estimate the plan could create as many as 500 jobs.
The target market for the converted vehicles are companies and authorities that run large fleets, as they can take most advantage of the lower excise thanks to the high mileages their vehicles cover.
VACC and GEA also believe there would be demand for LPG-powered SUVs, small cars, light-commercial vehicles and even hybrid cars.
Mr Purchase said the proposal was also based on the knowledge that Australia has large reserves of LPG and that greater use of LPG by the transport fleet would reduce Australia’s dependence on imported oil, improving the country’s energy security.