Tax and tighter controls threaten German industry

The pioneering German biofuel industry is being threatened by a new tax and tighter emission standards.


The government plans to introduce a 10c (7p)/litre fuel tax on all biofuels sold at public pumps from 1 August this year.


Where the biofuel is mixed with conventional fuel, the tax will be 15c (10p)/litre, but biofuel used in agriculture will be exempt.


The new tax would mean the biofuel industry would “lose customers overnight” and create a surplus, warned Dieter Bockey of UFOP, which promotes and develops biodiesel.


Germany has 12 large plants able to crush 7.9m tonnes of oilseed rape a year and more than 300 small plants able to deal with another 0.5m tonnes.


Biodiesel production this year will have trebled since 2004 to 3.4m tonnes.


More research was needed to ensure vehicles running on biodiesel would comply with tough new EU regulations on the emission of nitrogen oxides and particulates, Mr Bockey told a meeting in Monheim last week.


Better international co-operation was essential to agree a worldwide standard for biodiesel, which could also be produced from palm oil and other raw materials, he added.


Further work was needed to allow the fuel to be used in some common-rail injection pumps, found in most modern diesel engines.