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Rebated Fuel – The Law Surrounding Red Diesel

Rebated Fuel – The Law Surrounding Red Diesel

White diesel, alongside all crude oil derivatives, are subject to price fluctuations that are tied to the global political and socioeconomic climate. However, several sectors and industries in the UK have access to a far cheaper alternative: rebated fuels.

The most well known rebated fuel is red diesel, which has been the subject of fierce debate in recent years as its use was further restricted in April 2022. Read on to find out more about red diesel; what it is, who can use it, and how to order your next delivery from Nationwide Fuels!

What is red diesel?

It is the exact same as regular ‘white’ diesel except it is minimally taxed meaning it’s cheaper for the end-user and it is dyed red. It is sometimes referred to as rebated fuel. It is dyed red so that HMRC enforcement officers can identify where it is being used.

The first law regarding the usage of red diesel was introduced in 1935, and tractors weren’t allowed to use red diesel until 1979.

Unlawful usage of red diesel can still be detected even if the dye has been removed. Invisible chemical markers are also added to the fuel which allow HMRC enforcement officers to identify where red diesel has been “cleaned” and the dye removed, enabling them to prosecute illegal users.

Who can and cannot use it?

The laws surrounding red diesel use were updated in Budget 2020, meaning that a vast number of previously eligible users lost access to the fuel from the 1st of April 2022.

At time of writing, only the following sectors and users have retained their legal right to use red diesel:

  • Rail transport
  • Community amateur sport clubs and golf courses
  • Sailing, boating and marine transport (excluding private pleasure craft in Northern Ireland)
  • Travelling fairs and circuses
  • Fuel used for non-commercial purposes – electricity generation and heating
  • Agriculture, horticulture, fish farming and forestry

You can find out more about the legal use of red diesel in our red diesel FAQ.

What alternatives to red diesel are available?

If your business or sector has lost access to red diesel, or if you’re looking for greener alternative fuels that don’t incur expensive upgrades to your current infrastructure, there are a number of fuels available  to you.

HVO fuel is a synthetic diesel alternative that is a direct replacement for fossil diesels, but is 100% renewable and sustainable. It produces ca. 90% lower CO2 emissions compared to mineral diesel, and slashes other emissions too.

Carbon offset red diesel is a great alternative for red diesel users who are looking to offset their emissions. For an additional fee, the total carbon output of your fuels is calculated and offset using a 3rd party provider. Please note that CORD is only available to users who have retained their red diesel eligibility.

Industrial heating oil (IHO) can actually reduce your heating costs as it’s a clean burning, cost-effective alternative to diesel in oil-fired boilers. It is most often used in commercial and public buildings to provide heating and hot water.

To find out more about our range of carbon offset fuels, visit our carbon offset fuels page.

To book your red diesel delivery, or to speak to our fuel experts about alternative fuels, call us today on 0330 678 0880 to discuss your needs and requirements!

Information updated in April 2022

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