The Plan to Mandate E10 in Every Tank and Why It Keeps Stalling

Next time you roll up to the servo and slide straight past the green nozzle because you're not quite sure what E10 does to your car, you're part of a problem worth billions of litres. There's a quiet campaign running in Canberra right now to make that fuel a lot harder to ignore, and most motorists have no idea it's even happening.

Here's what's really going on. Australia's biofuel producers, led by the Manildra Group and backed by the National Farmers Federation, are pushing the federal government to mandate E10 petrol and B5 diesel across the whole country. Not a suggestion. Not an incentive. A rule, written into law, that would change what comes out of the bowser in every state.

What they're actually asking for

E10 is a blend of 10 per cent ethanol and 90 per cent regular unleaded petrol. B5 is ordinary diesel with 5 per cent biodiesel mixed through it. The industry wants both locked into the Fuel Quality Standards Act 2000, the rulebook that governs exactly what a station is allowed to sell you.

The muscle behind the push comes from one plant in particular. Manildra's facility at Bomaderry on the New South Wales South Coast already produces around 300 million litres of ethanol a year, made from wheat waste starch left over from flour milling. That single site accounts for roughly 68 per cent of the nation's entire ethanol output. The producers reckon they could scale up to feed a national mandate, but they want 18 months of tax relief to bankroll the investment, and they freely admit it would take a decade to supply full E10 and B5 everywhere.

So this isn't a flick of the switch. It's a slow build, and that's part of why it keeps stalling.

We've been here before

What most people don't realise is that this fight is older than the smartphone in your pocket. New South Wales brought in an ethanol mandate back in 2007, ratcheting it up to 6 per cent of all petrol sold by 2011. Queensland followed with its own version. On paper, that should mean E10 flowing freely at the majority of servos across two states.

Reality tells a different story. Even where the mandate is law, ethanol barely makes it onto the forecourt. Retailers can claim an exemption whenever the wholesale ethanol price climbs above what the Independent Pricing and Regulatory Tribunal calls a "reasonable" level. The big oil refiners have spent years getting comfortable with that loophole, and there's a separate carve out for stations that say upgrading their tanks would cost too much. The upshot is a mandate that exists on the books but leaks like a sieve in practice.

That's exactly why the biofuel lobby wants a national rule with sharper teeth. A patchwork of state schemes riddled with exemptions hasn't moved the needle. They're betting a single federal standard would.

Compared to the rest of the world

Let's put this in perspective, because Australia looks like a genuine laggard here. Brazil has run its cars on ethanol blends sitting around 27 per cent for years, built on a sugarcane industry that turned biofuel into national policy back in the 1970s oil shocks. The United States mandates billions of litres of renewable fuel every year under its Renewable Fuel Standard, and ethanol is baked into the American petrol supply so thoroughly that most drivers never think about it.

Australia, by contrast, still treats ethanol as a niche choice you actively have to opt into. For a country that grows the wheat and sugarcane the stuff is made from, that's a bit rich. The biofuel producers' whole argument is that we're importing fuel and exporting the feedstock at the same time, which to be fair is a fair point.

What it actually means at the bowser

Here's the part that hits your wallet. E10 carries a 94 RON rating, which puts it a notch above standard 91 unleaded, and it's usually a cent or two cheaper per litre. So far so good. The catch is energy content. Ethanol holds less energy than petrol, so E10 burns through a touch faster, meaning your fuel economy drops by roughly two to three per cent. You save at the pump, then give a little of it back at the rate you refill. For most drivers the maths comes out close to even, and on a cheap tank you can still come out ahead. If you want to see how the blends stack up week to week, the E10 price tracker lays it out.

The other question everyone asks is whether their car can handle it. The short answer for almost everyone is yes. Practically every petrol vehicle built this century is rated for E10, based on years of international testing. The exceptions are mostly cars built before the mid 1980s, some imports, and a handful of small engines and motorbikes. Check the inside of your fuel flap or the Federal Chamber of Automotive Industries compatibility list and you'll know in ten seconds. Modern engines in Sydney, Melbourne and Brisbane traffic won't notice the difference.

Diesel drivers get an even quieter ride. B5 at 5 per cent biodiesel is so close to standard diesel that you'd never pick it. The industry has run heavier blends in trucks for years without drama.

The bigger picture

The real story behind this push is about more than your weekly fill. It lands at the exact moment Australia is rattled about fuel security. The federal government committed a $14.8 billion fuel security and resilience package in May 2026, propping up the last two domestic refineries and building a government controlled reserve of diesel and jet fuel. Locally made ethanol and biodiesel fold neatly into that anxiety. The producers argue a national mandate would add a few extra days of reserves, sourced from Australian paddocks rather than tankers crossing the Indian Ocean.

Then there's the regional angle. The renewable energy agency ARENA reckons a serious bioenergy industry could spin up significant jobs in farming towns, and the producers point to more than seven million tonnes of greenhouse gas savings by 2035. Whether those numbers survive contact with reality is anyone's guess, but they're the carrots being dangled in front of a government already spending big on fuel sovereignty.

The thing is, none of it works without the oil majors on board, and they've shown for nearly two decades that they'll use every exemption going. That's the knot Canberra has to untangle before a single extra litre of ethanol reaches your tank.

What to take away

The biofuel fight rarely makes the front page, but it quietly decides what's waiting for you at the pump. Worth keeping in mind next time you reach for the bowser.