BIOFUEL SPECIALIST Global Commodities has announced it will open a plant this summer that will turn used vegetable oil into biodiesel.

No rapeseed oil will be processed at first, but there are hopes that farmers will eventually supply the factory, which has a 120m litres per year capacity.

Dennis Thouless, chairman of GC, said rape oil was currently too expensive to process into biodiesel in the UK.

“We‘re still trying to get the government to agree to either a bigger discount on the excise duty for biodiesel, or, if not, a statutory obligation to put 1% biofuel into fuels in this country.”

The latter would add 0.5p/litre to the cost of fuel at the pumps, he added, but was necessary to meet obligations under EU legislation for biofuel use.

European directives mean that 5.75% of road fuel must come from energy crops by 2010.

“What we need is more pressure on the government from farmers and the Country Land and Business Association.

“It is a great opportunity for growers; I see East Anglia as the oilfield of the future.”

The Hull site is being leased from Rix Biodiesel Ltd, which blends and distributes biodiesel to its 120 forecourts, as well as to other petrol stations and local authorities around the UK.

Rory Clarke, Rix managing director said: “The joint venture will bring together our combined knowledge of production, distribution and retailing.

“As the growing awareness of global warming takes effect, we expect more local authorities and other organisations to turn to biodiesel.

“It is the only renewable fuel that requires no vehicle modification or capital expenditure.”