Memorandum submitted by the Federation of Petroleum Suppliers (NPS 35)

 

Summary

The Federation of Petroleum Suppliers Ltd (FPS) welcomes the proposed NPSs, but considers that further supporting guidance is needed for downstream oil distribution infrastructure that is to remain within the jurisdiction of local planning authorities.

1 Oil will remain a vital fuel, especially for rural communities, for many years to come.

2 The reduction in the number of oil terminals has made distribution of oil more difficult and has resulted in increased movement of oil by road over far greater distances. This has made distributors' depot storage of greater importance within the downstream oil distribution infrastructure.

3 Planning applications for distributor oil storage depot improvements and expansions are generally not well received by local planning authorities.

4 In addition to the Energy NPSs, guidance in the form of a Public Planning Statement on downstream oil distribution infrastructure is therefore vital to ensure continued adequate supply of oil to end users, for which FPS seeks the support of the ECC Committee.

 

The Federation of Petroleum Suppliers

The Federation of Petroleum Suppliers (FPS) is the trade association for the oil distribution industry in the UK and the Republic of Ireland. It represents the majority of distributors in Great Britain from the small family business, which forms the greater part, to companies with UK-wide coverage. Deliveries go to domestic customers, retail forecourts, agricultural, marine, industrial and commercial sites for power, heating and transport fuel. Members of the FPS deliver almost all the domestic heating oil supplied to end users in Great Britain. Most distributors make deliveries to customers within a 30 mile radius of their depots and have storage for up to five days' supply.

FPS members operate around 2,750 oil tankers.

 

Comments

1 FPS welcomes the proposed Energy National Planning Statements, but is concerned that they do not address the needs of the downstream oil distribution infrastructure, which will remain within the jurisdiction of local planning authorities.

2 Oil is still a major source of energy, supplying diverse needs beyond fuelling road vehicles. Major uses include:

· Domestic property in rural locations, mostly without access to natural gas, where heating oil provides the only source of heating, hot water and cooking. According to SNP estimates, around 33% of households in Scotland do not have access to mains gas. The total number of households in Great Britain using oil heating is estimated at 1.1 million.

· Farms that require fuel not only for heating, but for off-road motive power.

· Local authority and community buildings and operations which provide residential care or services to the surrounding area, eg schools.

· The smaller emergency service depots, eg ambulance, fire and police, and the vital rural petrol forecourts.

· Smaller industrial units.

· Marine and inland vessels.

· Standby generator tanks at gas interruptible and other businesses.

3 Even though the Government is keen to transfer fossil fuel users to renewable fuels, realistically, this is a long-term project and oil will remain an important fuel source in the UK for a considerable number of years to come. This has been acknowledged in a number of reports produced for Government.

4 The Wood Mackenzie report on the UK Downstream Oil Infrastructure, produced for DECC (http://www.decc.gov.uk/en/content/cms/what_we_do/uk_supply/resilience/downstream_oil/improving/improving.aspx) concludes that low returns and weak demand growth has led to a lack of discretionary investment in the UK downstream oil infrastructure and industry consolidation, with a number of terminals closing, and that limited investment by independent storage companies, as opposed to the refiners, has been largely confined to coastal import terminals rather than inland logistics.

5 As a result, the number of coastal and inland oil terminals has reduced considerably in recent years. The loss of Buncefield was a major blow and has led to a high increase in road usage as product has had to be collected by road tanker from more distant terminals. The remaining terminals are now generally overcrowded with long queues of road tankers waiting to load.

6 Of the terminals that have closed for financial or other reasons, Portland oil terminal is worth remarking upon as an example of lack of consideration of adverse secondary effects, as it was a compulsory closure by the South West Regional Development Agency in order to provide facilities for the 2012 Olympic Games, with scant regard for the consequences on oil distribution in the area. There is now no terminal along the south coast between Southampton and Plymouth.

7 To compensate for the loss of terminals, distributors are investing in their depots in efforts to increase their own storage capacity and resilience. However, this is proving difficult in the majority of cases because of the opposition of local planning departments and councils. It should be noted that distributors do not store petrol at their depots, only less hazardous middle distillates.

8 For these reasons, FPS considers it imperative that the Energy NPSs are complemented by a Public Planning Statement covering downstream oil industry infrastructure to give guidance to local planning authorities. In this, we seek the support of the ECC Committee.

 

January 2010