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Australia's Diesel Addiction Jeopardizes Environmental Targets
26 Aug
Summary
- Australia's mining, freight, agriculture, fisheries and forestry sectors are major diesel users
- Switching to greener alternatives like electrification, biofuels and green hydrogen is hindered by cost, infrastructure and regulatory barriers
- Reforms to the Fuel Tax Credit Scheme could play a key role in incentivizing the transition away from diesel
As of August 26th, 2025, Australia is facing a significant challenge in meeting its environmental targets due to its heavy dependence on diesel fuel across various industries. According to a recent study by the Australian Academy of Technological Sciences and Engineering, diesel combustion accounts for 17% of the country's carbon emissions, with the mining, freight, agriculture, fisheries, and forestry sectors being the largest diesel users.
The report, created in partnership with mining giant Fortescue, identifies several barriers to reducing emissions in these diesel-reliant industries. The most significant hurdle is the cost of transitioning to greener alternatives, followed by a lack of supporting infrastructure and regulatory obstacles. Industries would need substantial assistance to shift away from fueling their equipment and transport with diesel, but the researchers emphasize that these reforms are necessary if Australia is to achieve its net-zero emissions goal by 2050.
The study recommends an independent assessment of decarbonization pathways, the development of a national future diesel strategy, and a review of the Fuel Tax Credit Scheme, which is currently subsidizing the use of the emissions-heavy fuel. Experts argue that capping these diesel tax subsidies could play a crucial role in incentivizing the adoption of alternative energy sources, such as electrification, biofuels, and green hydrogen.
