10th November 2005

The Government announced today its intention to introduce a Renewable Transport Fuels Obligation (RTFO) requiring 5% of all fuel sold to come from renewable sources by 2010

Chris Hunt, Director General of UKPIA, commented, "Many of our member companies are already selling biofuels blended with petrol or diesel. Biofuels have a role to play, but are just one of many measures to tackle C02 emissions from road transport, the level of which has been stable for the last seven years and is predicted to decline."

Hunt continued "We look forward to working with government on the detail of how the RTFO will work, but advocate the retention of maximum flexibility in meeting its requirements, including the introduction of bio feedstock into the refining process. The RTFO must also be applied to all road fossil fuels crossing the duty point, encourage the development of more efficient advanced biofuels, ensure the quality of fuel supplied and apply one global obligation, not separate ones for different products"

Notes to editors:

1. UKPIA represents the oil refining and marketing companies operating in the UK, which also own approximately 2,700 of the UK's 10,350 service stations.

2. UKPIA members own and operate the nine crude processing oil refineries in the UK.

3. The description "bio-fuel" is a generic one used to describe liquid or gas fuels that are not derived from petroleum based fossils fuels or contain a proportion of non fossil fuel. Bio-fuels fall into two main categories- conventional bio-fuels produced from plants - crops such as sugar cane/beet for ethanol and rape seed oil or re-processed vegetable oils for bio-diesel - and advanced bio-fuels from gasified biomass. At present, most bio-fuels fall into the conventional category.

4. Biofuels can cost two to three times as much as conventional petrol and diesel and currently enjoy 20 pence per litre duty differential compared to conventional fossil fuels.

5. Fore more information read 'Future Road Fuels', and 'Biofuels in the UK'