Fair UKtaxation would see great biodiesel chance

30 October 1998

Fair UKtaxation would see great biodiesel chance

Biodiesel would have a

bright future in Britain, if

it were given fair taxation.

Peter Clery, chairman of the

British Association for

Biofuels and Oils, updates

the arguments in its favour

THE EU already produces 0.5mt/yr of biodiesel fuel, mainly in France, Germany and Austria, because those countries tax it lightly or not at all – quite properly in view of its environmental benefits.

But the UK taxes it at the same swingeing rate as mineral oil diesel – about 44p/litre out of the pump price of about 65p/litre. That puts it right out of the market because production costs are 28-30p/litre against conventional diesel at one-third of that.

Biodiesel adds no extra carbon dioxide to the atmosphere, a key factor helping government meet its emissions target under the Kyoto Agreement. The carbon is recycled, fixed each year by the plant and released through combustion the next. There are effectively no sulphur emissions and other pollutants are minimal.

Biodiesel degrades quickly and harmlessly. Conventional diesel spills can be hazardous, especially in sensitive environments like waterways or food factories.

All diesel engines can use the biofuel with little or no adjustment, though hoses may need changing. Most continental manufacturers approve standardised biodiesel for their engines.

Fossil diesel will not last for ever. A UN International Energy Agency report last March predicted an oil crisis between 2010 and 2020. It received little publicity, but its reasoning is widely accepted. Now is none too soon to plan alternative sources of sustainable fuel.

Currently 1.4t of biodiesel can be made from 1ha (2.5 acres) of oilseed rape. The process is simple. After crushing, the oil is esterified using methanol and potassium hydroxide.

The result is rape methyl ester (RME) fuel, glycerine for soap making, and rapeseed meal. A plant producing 30,000-50,000t/yr would cost under £10m.

Substantial yield increases are confidently predicted. According to the Austrian Institute for Biofuels, by 2020 yields of 2.9t/ha (1.2t/acre) of oil could produce 21mt of biodiesel or 22% of current consumption.

In Britain, with appropriate set-aside arrangements under Agenda 2000, 200,000ha (494,000 acres) of industrial rape would provide 200,000t – enough to run Londons taxi fleet for a year – and most of the buses.

Scientists views

Government scientists dismiss biodiesel on the grounds that it takes nearly as much diesel to make through farming operations as is produced. But careful research in Europe proves conclusively that is not so. On a full life cycle analysis biodiesel gets a clear thumbs up.

Ethanol is another simple biofuel easily made from wheat, sugar beet or biomass. Stockholm in Sweden runs all its buses with a 5% ethanol additive giving a marked improvement in the citys air quality.

To get biodiesel and ethanol on the road to everyones advantage, the tax take should be limited to 10% of that for diesel, and Brussels should assign 200,000ha (494,000 acres) of UK land for the operation with appropriate area payment.

That would really do our atmosphere and farm accounts some good. Both are badly in need of help.

BIODIESELBENEFITS

&#8226 Environmentally positive.

&#8226 Fossil oil reserves limited.

&#8226 Continental enthusiasm.

&#8226 Biofuel out-taxed in UK.