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Who can use rebated fuel after the 1st of April 2022?

The rules around red diesel access are changing, alongside a number of updates to the UK’s rebated fuel legislation that affect fuel users across the UK.

Nationwide Fuels is here to help you stay on the right side of the law. We’ve collected everything you need to know about red diesel and rebated fuel access from the 1st of April 2022, so you can be sure that you’re not risking fines or seizure of your equipment.

What you need to know:

If your industry, sector or use case is losing the ability to use red diesel or another rebated fuel, then there are a few important points to consider:

  • If your sector, industry or application can no longer use rebated fuel after the 1st of April, you are no longer permitted to use it
  • You are not required to flush out any residue of rebated fuels from your tanks once you have used up your remaining stock
  • You must not stockpile rebated fuel in advance of the 1st of April

If you don’t use up any rebated fuel in your tanks before the 1st of April you must:

  • Sell or give the fuel to someone who is still eligible to use it
  • Sell or give the fuel to a Registered Dealer in Controlled Oil (RDCO)
  • Dispose of the fuel using an approved waste oil disposal or recycling company

If you choose to dispose of your fuel in any of the methods above, you must keep records showing how and when this was done. It is your responsibility as a fuel user to ensure that your unwanted fuels are passed on safely and within all applicable environmental guidelines.

The safest way to dispose of your unusable rebated fuels is via an approved waste oil disposal and recycling company, like Nationwide Fuels.

Who can still use rebated fuel after the 1st of April 2022?

The following sectors and industries are still able to use rebated fuels for accepted uses in:

  • Agriculture, horticulture, forestry and fish farming
  • Travelling fairs and circuses
  • Golf courses and driving ranges
  • Community amateur sports clubs that are registered with HMRC

You may also use rebated fuel in a machine used for generating power where the premises aren’t used for commercial purposes e.g. state schools and NHS buildings.

What’s an “accepted use”?

Accepted use is a term used by HMRC in relation to how a machine or vehicle running on rebated fuels is used. A tractor powered by red diesel on a private farm that’s used for agricultural purposes is an example of an accepted use.

For more information about accepted uses, including specific examples, you should visit this page on HMRC’s website.

What about fuel stored for backup power?

Some fuel users rely on stores of rebated fuel as backup or standby power, designed to provide a continuous supply of power in the event that the main method fails, e.g. a power cut or failure of the main generator. This includes essential or critical services, such as:

  • protecting national security
  • health services such as medical and life support equipment
  • emergency services and law enforcement
  • water, fuel and power supply
  • protecting the welfare of livestock and other animals

Rebated fuel can also be used for:

  • commercial electricity generators that help manage pressures on the national grid
  • in instances where a volume of back-up fuel is needed for security and regulatory purposes to sustain vital electricity supply

This does not include generators or machinery that are the main source of everyday power.

HMRC have accounted for these users, and they may continue to use up any rebated fuels obtained before the 11th of June 2021 for the following purposes:

  • standby electricity generation in commercial premises
  • critical equipment used for commercial purposes

Any rebated fuel that was purchased after the 11th of June 2021 may not be used from the 1st of April 2022 for either of those purposes. If you will have any such fuel left after the 1st of April cut-off date, you should contact HMRC directly at oils.policymail@hmrc.gov.uk.

HMRC will then decide whether or not to issue you with a licence which will allow you to:

  • Pay the duty difference between rebated and non-rebated fuel rates
  • Use up your remaining fuel on the 1st of April for non-accepted use

A licence from HMRC will only be valid until the 1st of April 2022, and won’t allow you to continue to purchase and use rebated fuel after this date.

You also won’t be expected to flush traces of your rebated fuel out of your tanks that hold fuel for standby generators or critical equipment.

Do you have rebated fuels and biodiesels that you can no longer use? Our Fuel Uplift Service can remove any surplus stock from your site safely. We also offer a range of remedial fuel services which can clean your tank in preparation for your new fuel supply.

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