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Government publishes response following advanced fuels call for evidence

Wed 30 April 2014 | Back to news list

The Government has published its comments on the advanced fuels call for evidence, which ran from December 2013 to February 2014, and on the post-implementation review of the Renewable Transport Fuel Obligation (RTFO). The Government says that it believes that low carbon fuels are critical to the future of the transport sector and that some form of government support will be necessary to bring them to market.

With regard to the RTFO, the Government says that biofuel supply has moved from a niche activity to a normal business operation for all major UK suppliers of road fuel. Even when taking out indirect land-use change (ILUC) effects, the response says that UK supplied biofuels are currently delivering an average 60% less carbon emissions than equivalent fossil fuels. It adds that 99% of the biofuel supplied in year five of the obligation has been certified as sustainable.

The Government notes that many respondents to the call for evidence emphasised the need to provide policy certainty for low carbon fuel suppliers and that current European negotiations have paralysed investment in the sector. The Government acknowledges that it is difficult for the sector to develop further while this ambiguity continues.

The Government says that it is pushing hard to conclude negotiations at European level and that it hopes agreement can be reached before the end of the year. It intends to engage with stakeholders in this process so that any policy options are robust and ready for implementation.

However, until discussions are concluded, the Government does not believe it would be beneficial to revise the current policy framework while it is unclear what the UK will be required to deliver under European targets.

The Government intends to look further into the merits of some of the stakeholder suggestions made in the call for evidence, including an additional support mechanism for advanced and more sustainable fuels and possible support for some fuels from fossil waste to the RTFO.

The response says it will consult more widely on the potential to support gaseous fuels on the basis of energy content. (Currently they are suppported on a volume/weight basis.)

It also intends to consult on potential support mechanisms for the production of synthetic fuels from renewable electricity and about the alignment of support for different forms of biodiesel.

The Government has previously announced £25m capital funding support to underpin significant private sector investment in one or more demonstration plants in order to drive the development of the UK's biofuels industry. The terms of the competition to allocate the funding are expected to be announced during the summer.

The Government's full response is published on the advanced fuels call for evidence website page.



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