What’s the issue with Red Derv? what is Red Derv? Why will it affect my costs?

Rebated diesel, known as red diesel, is just like standard or white diesel but is dyed red to make it easily identifiable because it is taxed at a much lower rate. It’s mostly illegal to use it on public roads.

From April the rebated fuel will no longer be permitted in many industries and white diesel will have to be used instead.

This means companies which currently use red diesel to fuel vehicles and equipment – including those in construction and recycling – will pay about 47p a litre more for their fuel.

HM Revenue and Customs (HMRC) has said the new restrictions are designed to help meet “climate change and air quality targets”.

It said the changes – announced in the 2020 budget – will help to encourage users of polluting fuels, such as diesel, to improve the energy efficiency of their vehicles and machinery, invest in cleaner alternatives, or just use less fuel.

The Treasury said it will “help to ensure fairness between different users of diesel fuels”. 

It added that red diesel accounts for nearly 14 million tonnes of carbon dioxide emissions every year and its reforms will mean that “many organisations will instead need to use diesel taxed at the same rate as that used by ordinary motorists, helping us to move to net-zero by 2050”.

We use and have used RED Derv in the refrigerated units for many years – it has helped to keep cost down. Currently there is no alternative other than to use diesel when out on the road. It does mean this will add a considerable cost to the running of a refrigerated trailer, it’s not a policy to reduce carbon as there is no alternative for the temperature controlled transport industry in the UK. You can still buy and use RED derv in Europe, you can still enter the UK with RED derv in the refrigerated unit if you are from the EU.