If you are laying up your motor-boat for a few months fuel contamination could be a real problem when starting up again.

Marine Red Diesel

Condensation in diesels tanks is the most common problem and it is recommended to avoid any space being taken up with moisture all tanks are filled for the lay- up periods.  As fuel levels lower in normal cruising the moisture-laden air condenses in the tank due to the ambient temperature changes. At this point water finds its way into your fuel and filters.  On the surface diesel bug can exist between the water and fuel having a detrimental effect on the fuel.  Another to keep the tank full whenever practicable

Petrol

Better to leave the tank empty when not cruising for long periods as petrol can go off over a long period. Symptoms are poor starting or even failure to start. Many companies provide fuel stabilizers when the tank is left full during several months of none cruising. Fuel Doctor is one such company that provide a fuel additive which also helps to give maximum power, improve fuel economy and prevent fuel system contamination. 

Fuel Expansion

Whilst full tanks for marine red diesel and when managed correctly in petrol tanks are steps to reduce the risk of contamination don’t forget that fuel expands on those warm days. A means to either collect any spillage, which should be removed as soon as practicable for safety reason, under the tank with a drip tray or leave a 10 % clearance space at the top of the tank to allow for expansion especially in the summer months.   If cruising outside the U.K. in warmer climes you may need to increase the clearance space mentioned above to prevent spillage due to increased expansion!

Conclusion

Near Full or empty is the best way to leave the tank when storing.

 From the 1^st November 2008 red diesel continues to be available to recreational boaters albeit fuel used for propulsion will be subject to the full rate of duty whilst fuel for domestic purposes e.g. heating, lighting etc will continue to be at the rebated rate.

Boat owners engaged in commercial boat operations e.g. yacht charters and deliveries

will continue to purchase fuel for propulsion at the rebated rate.

The new system works as follows for leisure boat owners. A written declaration is made to the vendor before purchase stating the percentage of fuel used for propulsion the balance as a percentage for domestic use. HMRC and the industry suggest a split of 60% for propulsion and 40% for domestic use, but the apportionment split is purely down to the owners intended usage and a level of honesty is required. After all HRMC may review the situation if the system does not work. 

The wording prescribed by HMR&C for this declaration is:-
“I declare that [  ] % of the fuel purchased will be used for propelling a private pleasure craft” and then the owner will be asked to pay the full rate of duty on the declared proportion of the fuel purchased. The vendor may also have a form to complete. Once the declaration is made there is nothing more to do.

HMRC have confirmed that VAT is charged at the reduced rate of 5% on fuel for propulsion and domestic use. A worked example is given below

This example assumes a 60% (propulsion) and 40% (domestic) split for a purchase of 100 litres of red diesel (the price of diesel is assumed to be 0.70ppl which includes 9.69ppl duty already paid to fuel supplier):

·         Propulsion calculation (i.e. 60%)

       60 litres @ 0.70ppl = £42
       60 litres @ 0.4066 = £24.40 (additional duty)
       VAT @ 5% = £3.32

     Propulsion Total = £69.72

·         Domestic calculation (i.e. 40%)

       40 litres @ 0.70ppl = £28
       VAT @ 5% = £ 1.40

     Domestic Total = £29.40

Transaction Total = £99.12

Don’t forget to keep invoices on board if travelling abroad on your boat where legislation for red diesel consumption can be different.

Overall the industry has welcomed this new system which has helped to alleviate major worries from leisure boat owners and the U.K. boating industry as a whole. Now let’s see if both U.K. boat owners, fuel suppliers and the HRMC can make the system work.

www.marinefuelpoint.com  08 December 2008.

VAT

HMRC have confirmed that VAT will continue to be charged at 5% on red diesel fuel for propulsion and domestic use. Only weeks before the fuel duty derogation for red diesel ends for propulsion on leisure craft the HRMC have cleared up some potential confusion in the industry regarding the amount of VAT to be charged. Good news, the VAT level is to remian at 5%,  i.e. not to be increased to 17.5%.

RED DIESEL FUEL DUTY

The expiry of the reduced rate of fuel duty is still going ahead and pleasure boat owners can expect an increase in fuel duty from the current 9.69 pence up to 50.35 pence from 1st November for all fuel declared for navigational(propulsion) purposes. Fuel duty for fuel declared for heating (domestic) purposes on both leisure and commercial boats remains unchanged at 9.69 pence. 

HRMC clarified the way in which additional fuel duty is to be collected from the 1^st November 2008, at the Southampton Boat Show. It will affect private pleasure craft owners when purchasing red diesel for propulsion and to a lesser extent when purchasing red diesel for heating.

How will it work?

Private pleasure craft owners will be able to continue to use red diesel for propulsion use, but at a modified duty rate.

They will have to declare the percentage of fuel to be used for propulsion and domestic use respectively at time of purchase.

HMRC say “It is for the purchaser to declare the percentage of fuel used for propulsion.  However, analysis by both the industry and HMRC suggests that a split of 60% for propulsion and 40% for domestic use (heating, cooking etc) probably reflects most people’s use and it is therefore likely that many users will declare such an apportionment.”

Example:  100 litres purchased by a pleasure craft owner.

·         40 litres subject to the current rate of duty - 9.69 pence per litre (ppl) at 5% VAT

·         60 litres subject to full duty - 50.35ppl at 17.5% VAT.

The combined effect could well raise the cost of the fuel from 70p a litre to about £1.27 for propulsion.

Registered Dealers in Controlled Oils (RCDO) will need to account to HMRC for any additional duty they receive from recreational boaters.  RCDOs already owe a general duty of care to ensure that they only make supplies of controlled oil for legitimate uses.

Residential Boat Owners

Residential boat owners whose primary residence is their boat and hold certain documentation, such as a Houseboat Licence, Residential Mooring Licence, Council Tax Bill in respect of the mooring, or other peripheral documentation, invoices or bills which provides proof of permanent residency, they may purchase all their fuel at the rebated rate

Effect on the industry.

Availability and supply facilities remain unchanged at present. The increase in fuel costs over the last year will undoubtedly hit some areas of leisure boating. However from the 1^st November with resourceful boat owners adapting to new fuel duty legislation and perhaps using their boats slightly less than the current average of 50hrs per year, against a backdrop of possible recession it will be difficult to measure alone the effect this change in legislation will have on the U.K. boating industry.

www.marinefuelpoint.com         17^th September 2008

With oil at under $100 per barrel down from Aprils $147 per barrel, how soon before the price comes further down at waterside refuelling? Send a price update via the site for your local waterside refuelling point and we’ll update.

As the price of fuel increases well documented cases of recent fuel theft from buses, farms tanks and haulage vehicles are focusing the minds of boating business to come up with solutions to protect the fuel tanks on all types of boats.

In the U.K. boat owners seeing the price of the red diesel increase in line with other petro-fuels are already bracing themselves for further increases. From November 1^st 2008 the U.K. falls into fuel duty alignment with the European Union and ceases the derogation of red diesel for propulsion onboard private boats.  In addition the British government has taken the initiative to add the full duty of about GBP 0.55p per litre where the European Union suggests GBP 0.21 per litre.  The value of the fuel in the tank is set to nearly double, so why not invest in new deterrents?

One such device is called ‘Fuellock’

Advantages

·         Lessens the risk of attracting thefts of fuel from craft which are left unattended.

·         Insurance companies tend to treat fuel as a consumable item. This means boaters are not usually covered for thefts of fuel.

·         Colour coded lids lessen the risk of wrong fuel into tanks e.g. Diesel and Petrol.

·         Water tanks locks are also available and since coded in different colours prevent further cross contamination between fuel and water.

·         Retailing at GBP 34.99 plus P&P for one fuellock it becomes a relatively inexpensive method of protecting the fuel tank.

Disadvantages

·         Can only be retrofitted to any boat whose deck fittings use the popular 1 ½  inch BSP thread. Check your deck fittings.

·         Can any fuellock be 100% secure against the determined criminal?

Conclusion

In the U.K. summer of 2008 for 1,000 litres of red diesel the cost is around GBP 750 and for leisure marine users it is set to rise above GBP 1350 from November 01^st . Providing retrofit is possible it seems a small investment over the long term to protect ones fuel tank from theft and limit the risk of cross contamination..

www.MarineFuelPoint.com 

Several news stories this week refer to the RNLI saving fuel !

The RNLI estimates its annual fuel bill this year will be up 100%, from £1.5m for 2007 to £3m for 2008.

Some lifeboats at top speed uses 360 litres of fuel an hour but last year marine diesel cost 38p/litre, now it has shot up to 72.4p. Fuel efficiency has suddenly become critical.

Although at top speed (24 knots) the lifeboat uses 360 litres an hour, at 20 knots, with the engine below 2000rpm, the rate drops to below 100 litres an hour.

Coxswains and crew members are reported to be undergoing training in fuel conservation and learn to drop-back on the throttle when on a non-emergency operation.

Just hot on the topic of where can one find biodiesel in the UK, the futuristic looking boat ‘Earthrace‘ visited Weymouth harbour 19-20th August. Chatting to one of the crew members (Hi Kathryn - who is 100% Aussie not Kiwi!), their official sponsors SGC Energy  made the arrangements for 12 refuelling points around the world. SGC Energy have 2 Biodiesel plants near Lisbon, Potugal.

Hopefully www.marinefuelpoint.com can give mariners a helping hand in locating suppliers in the future!

Marine red diesel in some areas of the U.K. last week was around 88p per litre and petrol at 125p per litre at waterside refuelling points, whilst marine LPG (Liquefied Petroleum Gas) is being sold at 44p per litre and has not followed the rapid increase Petrol and Diesel have over the last year. Is it the time to reconsider converting to marine LPG?

Advantages

• After taking into account the cost of conversion over a few years’ savings can be made. Hamble Marine Ltd claim a typical 250hp 5.7litre V8 engine consumes fuel at around 80lit/hr at full throttle and around 50 to 60 lit/hr while cruising. The cost of conversion (from £3,000 for a single petrol engine) can be recouped in about 100 hours.
• LPG has a low risk of pollution and pilferage.
• Emissions are more environmentally friendly than petrol and red diesel
• By retaining the fuel system the cruising range is extended and allows for dual fuel options.
• Refuelling is quick.

Disadvantages.

• At present there are a limited number of facilities providing marine LPG. The author is aware of one in Wales and five in southern U.K. so planning a cruise along the coast could be prohibitive due to lack of LPG or Petrol refuelling points.
• Due to the technical level of expertise and training required not all facilities supplying marine LPG can also provide the fitting and conversion expertise required.
• Most 4-stroke engines can be converted but not all.
• Safety is still a concern when talking to potential converters although that does not appear to have stopped countries like Holland and Australia who are quickly adopting auto-gas. Included in the conversion the electronic management system constantly monitors the engine bay and fuel storage tank areas for any leaks and will shut down the system before they reach a dangerous level.
• Specialist annual safety inspection required and test by approved engineers.

Conclusion

If one looks at current waterside petrol prices alone it would seem worthwhile for boat owners to reconsider converting to marine LPG where practical. A shortage of boat LPG refuelling points and conversion facilities at present will however constrain the expansion of marine LPG around the U.K. coast.

At the last Budget the Chancellor deferred the 2p rise in fuel duty until October 1 2008. Today Alistair Darling, the Chancellor announced that the Treasury was scrapping the planned rise of 2p and it will now come into effect earliest April 2009.

Mr. Darling explained that the move was designed to protect motorists from the effects of record oil prices which have reached $147 a barrel “The global credit crunch and sharp rises in world oil prices have pushed up prices at the pump,” he said. “Today’s decision will help motorists and businesses get through what is a difficult time for everyone.”

In respect of the end of derogation on UK red diesel from 1^st November this is at least some positive news for boat owners particularly if it can kick-start a government review on the very high fuel duty levied on the UK motorist and mariner.