Renewable Energy

Mr. Soames: To ask the Secretary of State for Environment, Food and Rural Affairs (1) what her Department's policy is on biofuels; [57787]

(2) what support her Department gives to the agricultural sector to grow and process alternative crops for renewable energy; [57788]

(3) what steps she is taking (a) to promote alternative crops for renewable energy and (b) to encourage the establishment of biofuel processing plants in England; [57789]

Mr. Morley: Bio-energy has an important role in supporting the Government's objectives for improving sustainability, reducing the impact of climate change, farm diversification and supporting rural jobs and areas.

Farmers growing certain crops for transport biofuels or the generation of heat and electricity can receive the single payment for crops on set-aside land or where the ?45/ha energy aid payment is claimed for crops on non set-aside land. Grants are available to farmers to establish energy crops for heat and power generation and to develop supply chains for energy crops and wood fuel, from harvest and processing through to delivery to end-users. Research has been commissioned to improve pest and disease resistance and crop yields.

The production of transport biofuels is supported through the 20 pence per litre cut in the duty rate for biodiesel and bioethanol. This has brought forward sales amounting to around 0.25 per cent. of all road fuel sales. In order to further develop supply, the Government have announced that a renewable transport fuels obligation will be introduced. This will require 5 per cent. of road fuel to come from a renewable source by 2010. Other measures are being considered, such as duty incentives to encourage the mixing of biomass with hydrocarbons in the conventional refinery process, and an enhanced capital allowance scheme for the cleanest biofuels processing plants. The latter scheme would allow the cost of capital assets to be written off against taxable profits. Regional support grants for capital investment in production plants are already available. A number of companies are either building, or have plans to build, biofuel processing plants that will include UK-grown oilseed rape, wheat or sugar beet as a feedstock.

£66 million has been allocated to develop markets for biomass, including energy crops, in heat and electricity generation. Electricity suppliers are required to source 15 per cent. of their electricity from renewables, including energy crops, by 2015. Co-firing of energy crops with fossil fuels in conventional power stations is developing. A cross-departmental team is looking at the recommendations of the Biomass Task Force on ways to overcome the barriers to developing biomass heat and power. The Government will publish a full response by the end of April.

[Written Answer - Hansard 16th March 2006]

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Shadow Environment Secretary Peter Ainsworth has condemned the Government for its timidity and lack of ambition over bio-fuels. Speaking at the Environmental Industries Commission Conference on the 4th April Peter Ainsworth said:

“The latest Budget Red Book boasts that the UK bio-fuels market has grown six-fold since 2003, which sounds impressive – until you discover that it now amounts to 118 million litres, or 0.25% of total road fuels.

“The EU target for 2005 was 2%. Germany got there, producing 1.2 billion litres of bio-diesel. In fact, across the 19 countries which declared their bio-fuel use, the weighted average was 1.5%; Britain came bottom of the heap. Even in the US, so often – and not without reason – the butt of Green jibes, they have hit a 2% bio-fuel mix.

“It is humiliating that the UK, which sets itself up to lead the world on climate change, is so under-achieving when it comes to practical measures to tackle the problem. It is the same failure of political will that has led to total UK carbon emissions rising in recent years. Policies, not rhetoric, will tackle climate change.”