Official Press Release LPG Subsidy

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First Grader
14 August 2006


LPG Australia has welcomed the Federal Government decision to offer cash-strapped motorists an affordable alternative to petrol-powered motor vehicles.
“The government subsidies for new LPG vehicles and conversions are a sensible response to current petrol price trends because they recognise that LPG Autogas is a readily available alternative fuel,” said LPG Australia’s industry development manager Phil Westlake.
Mr Westlake said that at current price differentials, motorists switching from petrol to autogas would effectively halve their fuel costs.
He said the Federal Government’s $2,000 autogas conversion subsidy means that motorists currently using $80 worth of petrol a week would pay back the average $2,500 cost of conversion in less than four months.
The $1,000 subsidy for new autogas vehicles means that if the same motorist chose to buy an LPG-powered Falcon, the extra purchase price over an equivalent petrol-powered model would also be recouped in less than four months.

The subsidies are available from today (August 14) and will run for eight years.

In response to the Federal Government move, LPG Australia has announced the immediate formation of an Autogas Task Force (ATF) charged with taking practical steps to ensure a rapid industry response to the expected growth in demand for autogas engine conversions.
“With the Government’s announcement, an autogas conversion has become an investment in the future for consumers, and the LPG industry will invest in the future as well,” said ATF spokesperson, Ian Maloney.
“While the spike in demand may involve some short-term conversion capacity issues, this will not adversely impact on the savings the motorist makes, which will continue for many years to come.
“The government has given the LPG industry long-term certainty and we will respond with greater installation capacity and a wider range of autogas kit availability.”
LPG Australia says there are already a large number of high technology fuel injection-type LPG kits available for many popular makes and models.
“The latest, fourth-generation LPG systems offer performance and driveability comparable with the best petrol engines. Motorists contemplating conversion can purchase these systems with confidence,” said Phil Westlake.
He said it was hoped that more motor vehicle manufacturers would respond to the subsidy decision by offering LPG engine options as original equipment.
Mr Westlake said the Government decision had recognised the powerful macro-economic and environmental arguments in favour of LPG Autogas.

“It also makes sense to make more use of autogas as an alternative transport fuel at a time when Australia currently exports around three billion litres of LPG per year, 40 per cent of our current production,” Mr Westlake said.
Last year crude oil production in Australia fell by 10 percent while LPG production rose by three per cent.
“Not only is LPG Autogas available in greater supply, it is also a lot greener than petrol, so this decision is a win for the environment as well as the consumer.”
Motor vehicles running on autogas typically produce about 15 per cent less greenhouse gas emissions and only one-fifth the air toxic emissions compared to their petrol-driven counterparts.
Consumers wanting more information about the environmental and financial advantages of autogas should visit
The site includes listings of available LPG conversion kits and installers which are frequently updated.


First Grader
This should have no effect on the short term price of LPG.

The subsidy was always going to come in, but wasnt due until 2011 when the excise on LPG came in.

The excise is 2.5 cents per year over 5 years from 2011, capped at 12.5 cents.

If you were to convert your car now and pay $3000 for the conversion ($3k will get a good conversion), with the subsidy of $2000. That leaves you $1000 out of pocket expenses.

If you do 20000 kms a year it would take you around a year to recoup your outlay.

Here is a simple calculation:

You use about 14 litres of gas to 10 litres of petrol, so:

Say you drive 20000 kms a year and your car gets about 100kms out of 10 litres of petrol, thats 100 kms out of 14 litres of LPG.

2000 litres of petrol a year @ $1.40 = $2800
2800 litres of LPG a year @ .55 = $1540

Thats a saving of around $1300 per year.



Kim Jong Dan
Staff member
Tipping Member
How much boot space do I have to sacrifice?


First Grader
A fair bit. You can have a doughnut shaped tank fitted into your spare tyre cavity as an alternative.


Kim Jong Dan
Staff member
Tipping Member
That isn't a bad option
I already dont have enough room to get much in my boot, so an LPG tank is going to have a big impact. Going into the tyre well might work better, The spare tyre going elsewhere is the problem!


Kim Jong Dan
Staff member
Tipping Member
dont you have to legally carry one?

I have shredded two tyres in this car so far!


Journey Man
Not sure about the legal side - many small cars these days have the dodgy spare designed to get you to the next garage, good for 100kms or so and less than 80 Kph.

Lpg is a better option than petrol so its a good step

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