16 June 1995

Government has open mind over incentives for bio-diesel

By Peter Bullen

Political correspondent

INDUSTRY demands for tax incentives to boost bio-diesel use are being considered by the government.

Farm minister William Waldegrave revealed on Tuesday that the government has not ruled out taxation "fillips" for new projects like bio-diesel. "Our minds are not closed," he said.

But he did suggest there were other ways of encouraging biodiesel sales by government using well-chosen regulatory routes. For instance, there was clearly a niche market for biodegradable fuels for use by canal boats, he said.

To cut down on water pollution the government could set biodegradable standards for boat fuels which would give bio-diesel an obvious advantage.

Mr Waldegrave was speaking at the first of a series of seminars for scientists, industrialists and farmers aimed at developing markets for industrial crops produced on UK farms.

His main message to farmers was to produce what industry wants and at competitive prices. The only basis for long-term prosperity was to produce raw materials to meet a market need not just to satisfy agricultural or social policy objectives.

The aim should be to seek viable long-term projects he said. He did not rule out short-term government aid to underpin research and development or providing pump-priming grants. But farming had to get away from the artificial support given to food production.

Jointly funded study

A joint industry/government-funded study into the industrial markets for oilseeds had revealed opportunities. "There are many possibilities for vegetable oils, in particular in the manufacture of lubricants, coatings, polymers and surfactants," he added. "Whether these can be turned into realities will depend on a range of factors – industry and consumer demands, economic viability, environmental pressures and regulations, further research and technological innovation."

Although the emphasis of the seminar was on the industrial use of oilseeds, Prof Derek Burke, vice-chancellor of the University of East Anglia, gave delegates a hint of the future by flourishing a bottle of tomato ketchup.

It looked like any other bottle of ketchup except that it will not reach the supermarket shelves for several months and is made from genetically modified tomatoes.

Developed by Zeneca, the ketchup gives producers the advantage of not having to pick tomatoes when they are green, as ripening was delayed in the modified fruit. For consumers the advantage was a ketchup that did not slide off the pasta, said Prof Burke.

A potential novel use for rape oil that was making swift progress was as a drilling lubricant on offshore oil rigs, the seminar heard.