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Service stations fleece motorists

MANY vehicles belonging to unsuspecting motorists could have been damaged as a result of service stations taking advantage of a loophole in Statutory Instrument 17 of 2013 to sell E20, afuel with a blend higher than the mandatory 15% ethanol blend with unleaded petrol (E15).

Faith Zaba

“There were some service stations blending their fuel to E20 and selling it at the same price as E10, making huge profits,” Energy and Power Development ministry permanent secretary Partson Mbiriri said in an interview with the Zimbabwe Independent yesterday. “There are games out there. But we could not take anyone to court even though we knew that they were selling E20. So we had to repeal the parent instrument. We are now going forward with the current E15 and as we move forward, we will announce E20 if we see it is sustainable”

The Petroleum (Mandatory Blending of Anhydrous Ethanol with Unleaded Petrol) Regulations published in Statutory Instrument 17 of 2013 gave a timetable for the progressive increase of the blend from E5 in August to E10 at end of October, E15 at end of November and E20 by February this year.

However, government was only able to increase the blend to E15 about a month ago allegedly due to heavy rains that affected harvesting of cane for ethanol production in Chisumbanje, prompting the ministry to relax the blending of petrol with ethanol from 15% to 10% in January.

However, some service stations have taken advantage of the timetable set out in Statutory Instrument 17 to fleece unsuspecting motorists by blending to E20 levels, but charging the price for E10 which is much cheaper. Energy minister Dzikamai Mavhaire has since gazetted amendments in Statutory Instrument 81 of 2014.

“Section 4(1) of the Petroleum (Mandatory Blending of Anhydrous Ethanol with Unleaded Petrol) Regulations, 2013, published in Statutory Instrument 17 of 2013, are amended by the repeal of proviso and substitution of the following:- provided that the minister, in consultation with the (Zimbabwe Energy Regulatory) Authority may, by publication of a notice in the Government Gazette, grant an exception from the level of blending in exceptional circumstances,” reads the amendment.

Mbiriri said without the amendment, government could not prosecute the service stations which were selling a higher blend.

“The initial statutory instrument gave dates for E10, E15 and E20. But we had problems with the rains and we could not sustain the E15 and we were forced to go down to E10. But by now we ought to have gone to E20, so it was necessary to repeal the statutory instrument as we moved forward. This was to clear the confusion by plugging loopholes,” he said.

Mbiriri said there was no going back on the mandatory blending, despite intense pressure from various quarters over the harmful effects of the E15 ethanol blend.

Ethanol producing company Green Fuel is lobbying government to set the mandatory blending to as high as 30% (E30) despite the motoring industry and general public reacting angrily to the gradual increase of the ethanol petrol blend to E15.

Mbiriri said car manufacturers and assemblers were just posturing in the media by suggesting anything above E10 was harmful to vehicles, but when in private meetings they have reassured government that petrol with ethanol blend of up to 20% (E20) was safe.

“We are liaising with car assemblers and major distributors of vehicles and on our part we have also done independent assessments,” he said.

“On the other side, it is necessary for the distributors to see that Zimbabwe has decided to go for bio-fuel so they also need to import vehicles that are compatible.”

Mbiriri added: “Yes, for vehicles that are already on the roads, there could be the odd challenge, but we can’t keep on importing cars that are not compatible.

“We are told that kits are only needed for above E25, that is the technical advice we have and we are not yet there. That is what they are telling us in confidence and they are continuing to issue warranties. They are just posturing and in our meetings they are telling us the opposite of what they are harping on about in the media.”.

Various car dealers, including those specialising in new luxury vehicles, have raised a red flag over the efficacy of the E15 blend, saying it may not be safe for motor vehicles.

Locally, Toyota, Nissan and Mazda vehicles are some of the most popular brands for motorists and dealers in these brands have already expressed reservations about the E15 blend arguing, among other things, that corrosion of metal parts, wear and damage of internal engine parts as well as damage or premature disintegration of the fuel pump are some of the likely problems associated with use of the blend.

Toyota Zimbabwe has said: “We have written to government advising them that most of our vehicles are compatible up to E10 blended fuel.”

Toyota Zimbabwe principal dealer Simplicio Shamba, in an interview with this paper soon after the initial government decision to introduce E15, said: “Above E10, older vehicles are likely to have performance problems relating to heat vapouring. The cars will not be able to cover the same distance they were able to cover with unleaded fuel.”

Nissan and Mazda have also repeated these concerns raised by Toyota Zimbabwe.

In a letter to the Zimbabwe Energy Regulatory Authority, Nissan said: “If this percentage (E10) is exceeded, Nissan products will have to have most fuel injection components changed and various rubber components installed into the fuel systems redesigning them to cater for a higher ethanol blend. “Any use of ethanol blend higher than 10% will render all Nissan products fuel systems unwarrantable.”

Questions have also been raised in some Zanu PF circles on why government was enacting “a law that benefits one person”, referring to controversial businessman Billy Rautenbach, who is a major shareholder in Green Fuel.

This is despite the fact Rautenbach has refused to cede 51% ownership in his Chisumbanje Ethanol plant to government in terms of the indigenisation law.

In March, Mavhaire said Green Fuel was awarded a licence to blend fuel on the understanding that it would comply with the Indigenisation and Economic Empowerment Act that requires indigenous Zimbabweans to own at least 51% of any venture valued at US$500 000 or more.

Green Fuel is a joint venture between Rautenbach’s Macdom and Rating Investments and state-owned Agricultural and Rural Development Authority (Arda) at its estates in Chisumbanje, Manicaland.

According to Arda, government’s contribution to the project is US$36,7 million, inclusive of land, while Green Fuel’s contribution is valued at US$331,8 million.

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