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Bounty to boost ethanol industry

The Federal Minister for Resources, David Beddall, today announced that he had awarded bounty allocations worth in total $6 million to Shoalhaven Starches P/L and CSR Distilleries for the production of fuel ethanol.

Mr Beddall said "The Ethanol Bounty scheme provides a strong incentive for the eventual development of a competitive, viable and ecologically sustainable ethanol transport fuel industry in Australia".

"The Ethanol Bounty Scheme is designed to complement the Government's lead abatement strategy. Supporting the development of an alternative fuel, such as ethanol, has the potential to contribute to reductions in airborne lead emissions and also greenhouse gas reductions."

The Scheme provides for the payment of 18 cents per litre on fuel ethanol produced in Australia from local biomass feedstock. Total Budget allocation for the scheme is $25 million. The bounty will not be extended beyond the financial year 1996-97.

Mr Beddall said that in making the allocations he had taken account of recommendations made by an Assessment Panel, chaired by Mr Murray Jackson, which had made an independent evaluation of the bids.

The Minister said that while other applicants for the bounty were unable to meet adequately the requirements of the scheme this year, they did contain concepts that may bring future environmental benefits and may have commercial potential in the longer - term. These include the use of lignocellulose (woody waste), potato and other waste products which may have commercial and greenhouse benefits.

The Government will be making additional bounty allocations for the second and third years of the scheme of up to $19 million, which should provide an incentive for further new entrants to the industry.

A complementary research and development package of $3.94 million is also been funded, which will address issues relating to the development of standards as well as production costs.

Further information:

John Kjar, Department of PI & Energy, (06) 272 4492 Tamara Johnson, Minister's Office, Mobile 015 266 370