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Energy and Climate Change Committee urges action to maintain the health of the UK oil refining industry

The ECC’s inquiry report on UK Oil Refining published today called for government action to address the burden of UK and EU legislative requirements that affect the competitiveness of UK refineries and establish a more level playing field with European and global competitors.

The key conclusions of the ECC were that “…The UK needs to maintain the health of its refining industry. A mix of domestically refined products and imports is an important ingredient of energy security and the UK refining industry is a welcome provider of jobs and tax revenue for the economy. We agree with witnesses who called for Government to set a long term framework for the industry to help secure its future….”  They went on to say “The scale of legislative and regulatory burdens on the industry may undermine long-term sustainability. DECC’s strategic objective should be to level the playing field between domestic refiners and importers, approaching these sectors as an integrated industry of two parts….”

Chris Hunt Director General of UKPIA (1), in welcoming the report commented: “The ECC’s inquiry and conclusions are timely and complement the ‘Call for Evidence’ from DECC on refining and the wider supply of fuels. As an evidence base, DECC’s study will be drawing upon a report published in May by energy analysts Purvin &Gertz (2) to assess the role and future of the oil refining industry and its value to the UK economy."

 He continued: “We look forward to publication of DECC’s conclusions later this year but in the meantime we would urge the Government to maintain its dialogue with the European Commission to undertake an urgent analysis in 2013 of all current and impending EU legislative impacts through the ‘Fitness Checks’ process being undertaken at the EU level via the Refining Forum (3 ) .”

 

Ends

 

Enquiries to:       

Chris Hunt, UKPIA Tel 0207 2697601

Nick Vandervell, UKPIA Tel. 020 7269 7604

Nunzia Florio, UKPIA Tel. 0207 268 7605

                             

Notes to editors:  

1.      UKPIA represents nine oil refining and marketing companies that operate the 7 major oil refineries in the UK; the refineries processed 69 million tonnes of crude oil and produced 70.3 million tonnes of refined products in 2012 (Source: DECC- DUKES data). UKPIA members also own around 1,600 of the 8,700 filling stations in the UK.

2.      Purvin & Gertz report 10th May 2013 (http://www.ukpia.com/files/pdf/therolefutureoftheukrefiningsector.pdf)

3.      The Refining Forum was established by the European Commission under the leadership of the DG for Energy at the end of 2012.It involves Member States, the Commission, Members of the European Parliament, Industry and Trade Unions to discuss and address the competitiveness challenges faced by the industry. An objective of the forum was to examine the impact of legislation upon competitiveness through a process of ‘fitness checks’ as envisaged by the Commission’s policy on Industrial Competitiveness. At the first forum meeting in April 2013 it was indicated that the Fitness Checks would not be completed until the end of 2014 and would only include existing or planned legislation not Fuels Quality Directive Article 7a or Industrial Emissions Directive refinery BREF impacts.

 


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