From Bill Brown, of Green Earth Biodiesel:
It is quite a rarity as its an example of Government and the
Treasury getting something right. I'm not sure if you were aware
but Biodiesel sold for road use receives a 20p per litre subsidy
compared to conventional diesel, this allows us to compete on price
with mineral diesel. We were due to lose this subsidy in April
2010, with it being replaced by something known as the RTFO
(Renewable Transport Fuel Obligation), the RTFO was intended as a
mechanism to increase the amount of renewables in road fuel and
through a system of trading certificates biodiesel producers would
be able to recover the value of the lost subsidy. Due to a woeful
miscalculation in 2008, the RTFO scheme has yet to deliver anything
like 20p per litre for the producers and subsequently a number of
producers formed the UK Sustainable Biodiesel Producers Association
and lobbied hard for the retention of the 20p per litre subsidy,
arguing that current policy, if implemented would kill the UK
biodiesel industry dead within a matter of months.
Although it didn't make it into The Chancellors pre budget
report speech, buried deep in the report is confirmation that the
20p subsidy will continue until April 2012. This in itself is great
news but of equal importance is the that from April 2010 the
subsidy will only apply to biodiesel produced from waste vegetable
oil. It is fantastic that at last Government policy will
differentiate between sustainable UK produced fuel and imported
fuels. It had been a thorn in the side to most UK based producers
that Super tankers loads of Indonesian Palm Oil Biodiesel attracted
the same tax breaks as UK fuel even though it offered nothing in
terms of sustainability.