Government withdraws support for Biofuel technology
12 March 2008

Alistair Darling’s first budget has pushed the pause button on the Government’s all-out support of biofuels. The Chancellor has abolished the UK government’s financial support of biofuels – the biofuels duty differential – in favour of the Renewable Transport Fuel Obligation (RTFO). The move should save the Government more than half a billion pounds by 2010.While acknowledging that “biofuels have the potential to make a significant contribution towards reducing emissions in the transport sector,” he also referred to incentivising “only the most sustainable biofuels, by shifting support away from the duty differential to the Renewable Transport Fuel Obligation in future years”. The RTFO forces fuel suppliers to ensure that 5 per cent of the fuels they provide is biofuel. The removal of the subsidy means that motorists will end up paying more for the same amount of fuel.This change of tack is the result of the King Review, authored by Julia King, vice-chancellor of Aston University, which was commissioned by the government and published today. She believes that factors such as change in land usage, nitrous oxide emissions from fertiliser use, processing methods and transport can significantly reduce the savings in greenhouse gas emission from using biofuels.So although the Chancellor claimed that “the Government believes that it is important that policy supports sustainable biofuels,” his announcement that Ed Gallagher, chairman of the RenewableFuels Agency, would lead a study of the wider economic and environmental impacts of biofuel production, including the impacts on food prices, speaks volumes of the new direction and the future price at the pump.

Ed Keohane

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Comments
6

12 March 2008

Once again the government cop out of ideas that don't make money but do make a difference!

12 March 2008

There's actually a big question mark over whether biofuels do work - see paragraph three of the Autocar story - which is why enthusiasm for them has dimmed generally.

12 March 2008

Plus deforestation to grow biofuels is not a good thing.

13 March 2008

Yeah it makes adifference as part of a mix of Elictricity,hydrogen and Biofuels mix, IF the manmade global warming theory is to be believed! Anyway we need to get off oil sooner or later as its a finite resource!

13 March 2008

How on earth is the average consumer supposed to make a decision on how to buy a climate-friendly car when the rules are changing every 5 minutes ? You get a car that runs on biofuel and the next day the cost of the fuel goes up. You buy a mid-band VED rated car and the next thing you know the tax has gone up overnight. The government is in a mess. They are trying to control people's behaviour by taxation. How can they when the people don't know what to do for the best ?

13 March 2008

They probably don't care what people do as long as they can raise more tax.

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