Red diesel vs Regular diesel: What’s the difference?

If you have only ever used diesel for driving purposes, then you are unlikely to know the difference between white and red diesel fuel. You may be surprised to know that, chemically speaking, the two …

Filling a car up with diesel fuel

If you have only ever used diesel for driving purposes, then you are unlikely to know the difference between white and red diesel fuel. You may be surprised to know that, chemically speaking, the two variants are identical.

If you use diesel to fuel your car, then, knowingly, or not, you will always have used white diesel. Red diesel, on the other hand, is used for heating and fuelling off-road vehicles, machinery, and generators.

So, if the two types of diesels are the same, why are they different colours?

We are going to explore this question and more as we dive into answering: red diesel vs regular diesel: what’s the difference?

What is the difference between red diesel and white diesel?

Besides the obvious colour difference, the main difference between red diesel and white diesel is the rate at which it’s taxed. Red diesel is used for machinery and off-road purposes, while white diesel is used in cars, but beyond that, red and white diesel are chemically identical and produce the same quantity of greenhouse gasses.

What colour diesel is best?

Both diesels have advantages because of their different uses. Red diesel has typically been taxed at a lower rate than white diesel. However, the move towards a greener future has meant that the uses of red diesel that qualify for tax rebates have recently been reduced.

So, let’s jump in and find out what red diesel can be used for.

What is red diesel?

Red diesel – sometimes known as ‘gas oil’ or ‘cherry red’ – is mainly used for off-road purposes. Traditionally, this may have included uses in the construction industry, such as for cranes, tractors, and bulldozers or for powering drills used for oil extraction. It is also used as industrial heating oil in industrial buildings and as power generation in facilities that require backup generators, such as hospitals.

However, as we shall come to see, the use of red diesel is now severely limited.

Red diesel is dyed red so authorities can easily check that it has not been illegally used in place of white diesel in on-road vehicles or for other illegitimate purposes at a cheaper rate. If you are found to have used red diesel illegally, you may face a hefty fine or even time in prison.

Red diesel accounts for approximately 15% of the diesel used in the UK. It is responsible for around fourteen million tonnes of carbon dioxide production every year, and the red diesel used in the construction and infrastructure sectors was estimated to have produced 7% of London’s nitrogen oxide emissions in 2018.

What is white diesel?

White diesel – sometimes known as ‘taxed diesel,’ ‘road diesel,’ or ‘DERV’ (Diesel Engine Road Vehicle) – was historically used to fuel on-road diesel cars, though there are more industries and sectors that must now use white diesel in place for red diesel for off-road duties.

Can white diesel be used in a car?

White diesel is currently the most common fuel type for cars in the UK. Its name is a misnomer as it is not actually white; it has a green/amber hue.

White diesel has two grades: summer and winter. The winter-grade white diesel contains additives that make it better adapted to work in colder weather.

What are the taxes on red diesel and white diesel?

The petrol duty charged on fuel for off-road purposes (red diesel) has always been significantly lower than the rate charged for on-road (white diesel) vehicles.

However, in the 2020 budget, the UK government announced that the rebate on red diesel would be rescinded from most sectors and uses starting from April 2022.

This means that red diesel, in most instances, now pays the same tax rate as white diesel. Or, rather, that most industries that previously used red diesel now use white diesel in its place and, therefore, pay the white diesel tax rate.

The current non-rebated rate of tax for white diesel is 57.95 pence per litre.

Red diesel that is still rebated currently pays 11.14 pence per litre in fuel duty.

What red diesel use is still rebated?

Although most former red diesel users now pay the standard rate of fuel duty on diesel, there are still some uses that qualify for the rebate.

These include:

  • vehicles and machinery used in agriculture, horticulture, fish farming, and forestry. This includes agricultural vehicles used for cutting verges and hedges, snow clearance, and gritting roads.
  • vehicles used to propel passengers, freight, or maintenance vehicles designed to run on rail tracks.
  • fuel for heating and electricity generation in non-commercial premises. This includes the heating of homes and buildings such as places of worship, hospitals, and town halls, off-grid power generation, and non-propulsion uses on permanently moored houseboats.
  • fuel for maintaining community amateur sports clubs as well as golf courses.
  • fuel for all marine craft operating in the UK (including fishing and water freight industries), except for propelling private pleasure craft in Northern Ireland.
  • fuel for powering the machinery (including caravans) of travelling fairs and circuses.

However, these exemptions are not fixed, and their status may change in the future. As more alternative fuels are made available, the government will review the use of red diesel in each setting.

Why did the tax rates on red diesel change?

The change was brought in to help meet the UK’s target of becoming carbon neutral by 2050 and affects most users of red diesel.

At the 2015 Paris Climate Accords, participating countries – of which the UK was one – agreed to submit their plans to tackle climate change every five years. The aim is for the plans announced during every five-year cycle to be increasingly ambitious in a collective effort to tackle the ongoing climate emergency.

Removing the red diesel rebate from most users will raise taxes that can be reinvested in greener solutions. It also incentivises businesses to move towards using cleaner energy that still benefits from lower tax rates as well as to simply use less diesel as fuel.

The UK government understood that while the changes in fuel duty on red diesel would have a significant impact, there was still a need to provide businesses with adequate time to prepare themselves for the change. Therefore, the policy was announced in 2020 but did not come into effect until April 2022.

What alternatives are there to red diesel?

There are already alternatives to diesel, each with its own advantages and disadvantages.

HVO fuel stands for “hydrotreated vegetable oil.” It is a synthetic diesel alternative that is fossil-free and reduces greenhouse emissions by 90%.

As well as being as reliable as diesel, HVO also has a shelf life of up to 10 years, unlike diesel which has a shelf life of around 1 year.

HVO is taxed at the same rate as diesel when fueling on-road vehicles. It also costs more than diesel per litre.

Similarly, biodiesel is a more sustainable alternative to regular diesel, but it costs more and has no tax relief when used to fuel on-road vehicles.

What is the penalty for illegally using red diesel?

Using red diesel in a context where the law states you should be using white is a criminal offence. Anyone found doing so is liable to face prosecution, which could lead to hefty fines or even jail time.

Red diesel users who were required to make the shift to white diesel were advised to deplete their stocks prior to April 1st, 2022.

Any vehicles, machinery, or other such equipment that is found to have used red diesel illegally could be taken by the authorities.

Red diesel gets its colour from a dye that is specifically designed to stain the interior chamber of the tanks, pipes, and engines that use it. As we saw earlier, this makes it easier for authorities to inspect machinery, vehicles, and equipment to ensure that there has been no illegal use of the fuel.

However, this also means that some erstwhile red diesel users switching to white diesel run the risk of being falsely accused of using red diesel.

The government has said that anyone accused of misusing red diesel can appeal if they feel the accusations are unfair.

While there is no official guidance on what to do with stained tanks, users have been told not to flush their systems to ensure any subsequent environmental damage is prevented.

What changes do fuel suppliers have to make under the new rules?

Fuel suppliers were also required to make operational changes to help ensure the transition to the new rules was as smooth as possible.

The government asked that fuel suppliers flush their tanks or replace them entirely so that no remnants of the red diesel dye remained. This helps inspectors and authorities with their work examining equipment to ensure it is compliant. It did, however, incur a cost to the suppliers.

Prior to April 2022, the government also asked suppliers to monitor the overall use of red diesel to ensure that all users depleted their existing stocks before purchasing anymore.

Summary

Red diesel is made from the same chemicals as white diesel, but its colour is changed using red dye. Red diesel has historically paid far less in fuel duty than white diesel, which is used to fuel on-road vehicles. The red dye stains the fuel tank the red diesel is used in so that authorities can easily check whether the user has legitimately used their rebated fuel.

Since April 2022, there has been a significant reduction in the number of uses in which red diesel can be used. So, if you have previously used red diesel for any purpose, then be sure to check that your use of it is still legally permissible.