The BAM companies say that switching to hydrotreated vegetable oil (HVO) instead of diesel will be 15% more expensive – at 67p per litre – but worth it to meet the decarbonisation aspirations of clients.
In 2020 BAM consumed 7.1m litres of red diesel on UK projects, accounting for around 70% of the company’s total direct carbon footprint. HVO reduces net CO2 emissions by as much as 90% compared to diesel but adds more than £600,000 to annual operating costs if HVO replaces all diesel consumption.
However, while BAM has committed itself to using HVO, and signed a supply deal with Crown Oil, the transition is likely to be phased rather than overnight. Diesel generator sets are still used quite widely on BAM sites.
HVO deliveries to BAM sites began last week but the priority is getting larger framework contracts established first, prioritising organisations like Network Rail and the Environmental Agency.
BAM said that while HVO was considered an important step in carbon reduction, its ultimate goal is to eliminate all internal combustion engines and opt for electrically alternatives powered by batteries or hydrogen fuel cells.
Sarah Jolliffe, carbon reduction lead at BAM Nuttall said: “HVO fuel has been available for several years but it is only in the last 12-18 months that this fuel has been approved by plant and engine manufacturers for use in their equipment.
“HVO differs from gas oil, diesel and petrol as it isn’t derived from crude oil, the main cause of greenhouse gases, including carbon dioxide. HVO is made through the hydrotreatment of pre-existing bio-waste products such as used cooking oil, waste plant and organic matter.
“Many of the projects we deliver and clients we support aim to decarbonise public transport or protect people from the effects of climate change. But the engineering solutions and construction operations have a high carbon impact. We want to reduce carbon throughout the whole lifecycle of a project, from the way the site operates through to the materials used in construction, and the way assets are operated, maintained and dismantled.”
BAM’s clients certainly seem enthused by the switch to HVO.
David Jarman, programme manager for Network Rail’s southeast multi-disciplinary framework, said: “The use of HVO fuel as an alternative to red diesel is a fantastic one which we hope will have a dramatic and positive effect on our carbon omissions. Trials that have been run on our stations portfolio have been positive and I am now excited to see it rolled out across all of our sites.”
David Oake, senior advisor from the Environment Agency in Yorkshire Area, said: “On our Kirkstall Valley Farm site, part of Leeds Flood Alleviation Scheme Phase 2, 46% of our carbon emissions come from construction and a further 31% from the supply chain. Therefore, alternative fuels have a vital role to play in reducing our carbon emissions. We have committed to switch our plant on site to HVO, reducing our related net carbon emissions by 90%.”
Construction’s tax rebate for red diesel is scrapped in April 2022, adding nearly 47 pence on to the cost of every litre. Under current plans, this will apply to HVO as well, as it is treated as diesel by the tax authorities. However, industry lobbyists are pushing for a lower tax rate for cleaner fuels to encourage use.
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