§ Mr. HayesTo ask the Secretary of State for Transport what arrangements he intends to put in place to meet European Union targets for biofuel use by(a) 2005 and (b) 2010. [134370]
§ Mr. McNultyThe European Union's Biofuels Directive requires member states to set their own indicative targets for sales of biofuels for road transport to be met in 2005 and 2010. The Government will be consulting early next year on the level of possible targets for the UK and on the steps it might take to meet them.
§ Mr. PaiceTo ask the Secretary of State for Transport pursuant to his answer of 14 October 2003,Official Report, column 165W, on biofuels, what assessment he has made of the costs if the UK were to set targets for sales of biofuels at (a) 2 per cent. by 2005 and (b) 5.75 per cent. by 2010. [134141]
§ Mr. McNultyWe have not carried out any detailed assessment of what the costs to the UK might be if we chose to set indicative biofuels sales targets at those levels. This sort of analysis will form part of the consultation paper on our plans for implementing the Directive which we plan to issue early next year, and will help inform the level of targets that we choose to set.
64WSThe costs to the UK will depend on a number of factors, including the level of Government support for biofuels. The Government currently provide a 20 pence per litre fuel duty incentive for biodiesel, with a similar duty incentive for bioethanol due to come into effect in January 2005. At these levels of duty incentive, if sales of biofuels were to reach 2 per cent. of total annual fuel sales (i.e. almost 1 billion litres), the fuel duty revenue forgone would be in the region of £200 million per annum. If they were to reach 5.75 per cent. of total fuel sales (or total sales of a little under 3 billion litres), the revenue forgone would be close to £600 million per annum. There may be other public costs too, including any grants that help support the production of biofuels, or any subsidies provided under the Common Agricultural Policy.