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What ever happened to LPG?

05/09/2022 by Mark Schneider in Fuel Cards

Those of us with long memories might remember when LPG, that’s Liquified Petroleum Gas, was being touted as the answer to high fuel prices and dependence on foreign fuel supplies, while also offering reduced pollution and (slightly) lower CO2 emissions.

Australia has huge reserves of gas and LPG offers quite a few advantages over petrol as a fuel for internal combustion engines, such as cleaner running and a faster warm-up, so in principle there’s a lot to like about it.

Back in 2006 the Australian government went so far as to offer rebates for LPG systems installed in vehicles, or for new vehicles that were fueled on it.

There was a thriving industry offering aftermarket dual-fuel systems for somewhere between $2,000-4,000, and Holdens and Fords were even rolling off production lines with factory-installed systems.

Best of all cheap LPG was seemingly available in fuel stations everywhere, so filling up with gas was really not much different to filling up with petrol.

Little wonder then, that drivers of vehicles that covered a lot of kilometres, like taxis, really took to it.

These days that’s all changed. Less than 2% of Australia’s vehicles run on LPG and finding a service station that supplies it can involve quite a run-around, and in country areas it can be very difficult.

Automotive LPG sales have fallen dramatically since 2010 and continue to fall. So, what happened to this fuel that seemed to offer so much? Well, there are a few reasons behind its demise.


For starters, the price advantage of LPG started being eroded when the government introduced an excise on it from 2011.

The economics of paying for an LPG conversion suddenly didn’t make so much sense, and in any case the days of relatively simple “one size fits all” LPG conversions on cars were coming to an end with the increasing technical complexity of modern cars.

Then in 2014 the rebate for fitting the equipment was withdrawn in the face of low take-up.

Another price to be paid for converting your vehicle to LPG had nothing to do with dollars, it was all about boot space, which was greatly diminished by the presence of a big gas tank in the back.

Hybrids and turbodiesels

All of this came at a time when hybrid vehicles, such as the Toyota Prius, were becoming increasingly popular, and small turbodiesels like the Hyundai i30 were also offering motorists much-improved fuel economy.

It also didn’t help LPG’s cause that when the last Holdens and Fords rolled out of Australian factories, it also marked the end of factory-installed LPG systems.

LPG is becoming little more than a footnote in Australian motoring history, but it’s interesting to conjecture about how things might have been turned out with a different set of circumstances and policies.

Had domestic vehicle production survived, new LPG vehicles would at least have become possible, and with the right government policies and the right pricing it might even have remained an attractive option for many Australian motorists driving long distances regularly, saving them quite a lot of money in the process.

But as it is, we’re all stuck with those high petrol and diesel prices for the time being, rather than cheaper Australian LPG. Ouch!

Written by
Mark Schneider

Mark is a successful copywriter with over 20 years of professional writing experience.

We welcome him as a guest blogger to Fleettorque.

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