The banning of red diesel use for certain applications has had significant operational and financial impacts on some users of compressed air.

What's changed if you run your compressor on red diesel?

It’s no longer legal to use red diesel for non-road using machinery such as mobile air compressors. As of 1 April 2022, red diesel is no longer available at a rebated rate for many commercial applications.
Red diesel contains red dye and other chemical markers to indicate that it is rebated diesel and has therefore been subject to less fuel duty than normal (white) road fuel diesel. The red marker allows HM Revenue and Customs (HMRC) to check whether red diesel is being used illegally. The UK government announced changes to the rules on rebated diesel usage and this has since been a source of confusion and concern across UK businesses.

What is the cost difference?

Red diesel (gas oil) attracts a rebate of 46.81 pence per litre (ppl), giving it an effective duty rate of 11.14ppl. Whilst White diesel (DERV) on the other hand, has no rebate, means a duty rate of 57.95 ppl. Therefore, making a straight switch from red to white diesel would incur an additional expense of 46.81 pence per litre used. This results in five times as much duty as before. This will have a significant impact on costs as well as cash flow for many businesses.

What low cost alternatives to red diesel could run a compressor?

Fossil free HVO (hydro-treated vegetable oil) is a renewable diesel replacement made to EN15940 standard. It is the lowest emission diesel replacement fuel available. HVO is made entirely from waste and is defined as renewable and sustainable (RED11), whilst being highly refined. It is a genuine green drop in alternative to diesel.

You can use HVO in any diesel engine without requiring any changes to the engine. Manufacturers have approved HVO and identified that there is no degradation in performance. HVO burns more cleanly and more thoroughly so helping you to save costs in fuel efficiency. This bio-degradable fuel is an ideal replacement for red diesel and is OEM approved.

Why is this happening now?

The red diesel duty reform was designed to help propel the UK forward on its road towards Net Zero Carbon 2050. With ambitious targets to meet, the government is accelerating its efforts to reduce carbon emissions, from the introduction of the Clean Air Strategy to Ultra Low Emissions Zones (ULEZ). Like any period of change, the road to zero will not come without its challenges.