Select Committee on Environment, Food and Rural Affairs Appendices to the Minutes of Evidence


Memorandum submitted by the British Association for Biofuels and Oils (BABFO) (A33)

  BABFO exists to promote a new industry for British agriculture—the production of liquid biofuels for road transport.

  To establish a viable liquid biofuels industry within whatever subsidy/quota framework exists for British agriculture requires only that the Treasury, within EU rules; applies an equitable rate of duty to these fuels. The high rate of fuel duty (around 45p/litre) was introduced to curb the use of polluting finite fossil fuel. It is therefore illogical to tax biofuels as heavily as fossil fuels, they are part of the solution not the problem. The fossil gas fuels (LPG, CNG, LNG) have been given a major duty rebate equal to about 40ppl or a duty rate of about 4.5ppl. These fuels however do little or nothing to curb greenhouse gas production compared with the biofuels. Also the benefit of their better tailpipe emissions has to a large degree been overtaken by the development of particulate traps and catalytic converters. Nevertheless the Government considers that these fuels warrant this duty rebate. Given this, the case for biofuels to have the same rebate is overwhelming. The initial 20p rebate on biodiesel promised for Budget 2002 is a start but is not enough to start large-scale production by the major firms waiting in the wings with the capital and expertise so to do. The production process is simple—oilseeds are crushed, extraction rate being about 42 per cent oil, the oil is then "esterified" to remove the glycerine element and the resulting fuel is the ether biodiesel. The co-products are glycerine (used in soap manufacture) and oilseed meal for animal feed.

  A low level flight over the UK would suggest that the current level of stewardship of farmland is good. After all it is not in the interest of the farmer and landowner to devalue his/her property by poor husbandry. However, growing crops for liquid biofuels could enhance biodiversity and prosperity as shown below as well as creating diversity of supply, a key point in Government energy policy:

    —  New root crops would be developed, ie new strains of fodder beet for bioethanol;

    —  Codes of practice for oil seed crops would be developed (discussions have already taken place with the RSPB who have found that oilseeds provide an excellent habitat for linnets and other seed-eating birds);

    —  Rural employment would be aided as "set aside" land was brought from idleness to useful production.

  A hundred years ago some 20 per cent of English farmland was used for road transport fuel production—oats and hay for horses. It is quite practical to consider that a similar percentage of our land could within ten or twenty years be used again for road transport fuel.

  There are some 6 million ha of crops and temporary grass in the UK. If 20 per cent were put to liquid biofuels, some 1.2 million ha would be available. If split equally between biodiesel and bioethanol crops there would be 600,000ha for each fuel. Current yields of biodiesel in Europe are around 1.6t of oil per ha per annum at an extraction rate of 42 per cent. However, best practice in Germany is already achieving 2t/ha/pa. At 1.75t oil /ha/pa, 600,000ha would give some 1 million tonnes, 6.6 per cent of current DERV uptake of 15 million tpa. Currently there is some 500,000ha of set aside and much of this is potentially available for oilseeds. Linseed is no longer a practical proposition and land previously under this crop (200,000ha in 1999) could also be available. Oilseed crops for food use currently take about 400,000ha and there are no husbandry reasons why UK oilseed area should not come up to 1 million ha/pa.

  For bioethanol, yields from wheat are of the order of 3 tonnes per ha but higher yields are in prospect from such specialist crops as fodder beet and wheat harvested as wheat crop prior to full ripening. If prospective yield were taken at 3.5t/ha/pa, 600,000ha would produce some 2 million tonnes or 9 per cent of the 22 million tonnes of petrol now burnt annually in the UK.

  Transport fuel is the fastest-rising cause of greenhouse gas (ghg) and the biofuels on full life cycle analysis produce less than half of the ghg on a g/km travelled basis compared with fossil derived petrol, gas and diesel. The case for a tax rebate which recognises this is overwhelming especially when it is recalled that the high fuel duty rate was introduced to curb the use of finite polluting fossil fuel.

  Old MAFF found it difficult to grasp these realities. We hope new DEFRA will have a better concept of joined up Government as DTLR, DTI and of course the Treasury are involved as well as DEFRA. We are aware that Professor Nigel Mortimer of Sheffield Hallam University has been asked by the Non Food Forum to look at biodiesel. Unfortunately it now transpires that Professor Mortimer, excellent man that he is, should not have been appointed as he is already under contract to the Government on other projects and his work has been mostly with energy conservation in buildings. We fear he may have been selected by certain civil servants to try to ensure they get the answer they want through the simple expedient of giving guidance to the piper whom they are paying.

  DTLR are leading on fuel duties for biofuels but they have shown a marked lack of understanding of the underlying rural realities and have consistently funded the gas fuels instead. This may prove embarrassing. For the record, after five years of promotion, gas managed only 0.01 per cent of the fuel market (47,000 tonnes) in the last 12 months for which data is available. Therefore all the effort has produced no saving on ghg and immeasurably small reductions in tailpipe emissions.

  The nation's interests may be best served if DEFRA (Head of Industrial Crops) were given the lead leaving DTLR be consulted only on emissions. DTI may come to understand the favourable energy balances of biodiesel (energy output 2x input and 4x if the straw is utilised for electricity generation as in the excellent Ely power station), Biofuels are the Low Carbon fuel potentially available now.

  The EU has recently issued draft directives indicating 2 per cent of road transport to be biofuelled by 2005 and upwards of 5.75 per cent by 2010. For the UK, the 2005 target would mean 300,000 tonnes of biodiesel and about 440,000 tonnes of bioethanol.

  Private capital and expertise is waiting in the wings to create this new liquid biofuels industry. All that is needed is a duty rate close to parity with the gas fuels.

  In conclusion, may we invite the Committee to take a fresh look at the massive agricultural and environmental potential of biodiesel and bioethanol and press the Chancellor to rapidly bring the duty on these fuels into line with the fossil gas fuels. A rate of around 5p per litre. We show above that the biofuels could provide 3 million tonnes in short order to give major savings in ghg and tailpipe emissions, create energy, increase diversity of fuel supplies, lessen the environmental hazards attached to fossil fuels and increase biodiversity.

  Please note that further supporting evidence is available in the "Green Fuels Challenge" paper submitted to the DTLR by BABFO.

  Annexed is a paper by Professor Sir Colin Spedding CBE covering wider political and strategic implications for biofuels.

14 December 2001

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