RTFO Publication - Industry Reaction
On Thursday 14th September the Department for Transport published its long awaited proposals on the Renewable Transport Fuels Obligation (RTFO), which consulted on its original draft earlier this year.
Below is a selection of initial quotes from the industry regarding the announcement. Further information and reaction will follow once the substantial documents have been fully digested and analysed.
Mark Chesworth, Managing Director at Vivergo Fuels, the UK’s largest producer of bioethanol reluctantly welcomed the Governments Renewable Transport Fuel Obligation proposals:
“Whilst we welcome the Government raising the renewable blending obligation and their increasing the recommended crop cap to an initial 4%, indicating that they have taken on board some of the concerns of the 93% of stakeholders who called for a high cap, we remain concerned about the proposed post 2020 year-on-year reduction. This decreasing cap is predicated on a number of uncertainties and could have serious consequences for the long-term future of the British bioethanol industry, jobs in the North of England and domestic agriculture.
“We agree with the Transport Minister Jesse Norman MP that E10 fuel makes ‘achieving our targets easier and potentially more cost effective, as well as providing an economic boost to domestic producers’. However, we would question whether E10 can be successfully introduced and sustained with a crop cap which, even at its highest point, is the lowest in Europe. We would therefore call on the Government to mandate E10, enabling a swift co-ordinated roll-out and a clear and consistent message to consumers.”
Ensus welcomes the UK Government’s plan to introduce legislation intended to improve air quality and reduce carbon emissions in transport. The legislation has the potential to increase the volume of bioethanol in petrol in the coming years.
We are also pleased that the Government supports the introduction of the E10 blend into petrol by the major oil companies as an immediate and highly effective means of reducing carbon emissions and improving air quality in a way which is compatible with most petrol cars and fuel infrastructure.
However, we are concerned that the use of British, sustainably produced crops in biofuels will be capped at a level too low to exploit the UK´s potential. Even worse, the unjustified and steeply decreasing level over time is a massively missed opportunity in the battle to decarbonise the UK’s transport fuels. This will negatively impact on British farmers for whom the ethanol industry is an important business partner. The proposal also ignores the valuable role of protein co-products produced alongside the UK´s bioethanol production. Consequently, a crop cap as proposed will lead to rising import needs for protein feed.
Given this very low crop cap and no commitment about using bioethanol - particularly E10 - this will effectively discourage oil companies from utilising sustainable bioethanol to meet the new proposed legislation. This puts UK investments and jobs at risk over time, particular in the Northern Powerhouse area.
We will therefore continue to demonstrate to Government the benefits of increasing the crop cap and urge Government to recognise crop-based bioethanol as a viable and sustainable fuel as well as a provider of high protein animal feed into the UK agricultural market.
Renewable Energy Association
The renewable energy industry cautiously welcomes the proposals published by the Department for Transport today to increase the amount of renewable fuel in the transport energy mix. The proposals, however, will not allow the UK’s biofuels industry to reach its full potential.
In its response to the consultation earlier this year on amending the RTFO, the Government is confirming that the UK market share for renewable transport fuels will now reach 9.75% by 2020 and 12.4% by 2032 which is helpful. This is particularly positive for the increasing use of waste-based biofuels. However, the confirmation that a crop cap will be introduced and decreased over time to 2% by 2032 is disappointing. Without this existing UK manufacturing infrastructure will not be able to deliver its potential risking UK jobs and investment.
The UK biofuels industry employs approximately 10,000 people, largely in the North East, North West and Scotland.
Dr. Nina Skorupska CBE, Chief Executive of the Renewable Energy Association said:
“The REA is pleased that the amount of renewable fuel will now be increased, which gives biofuels producers, especially those using waste as feedstock a bigger market to go for. However, the decision to decrease the use of sustainable crops in renewable fuel production to 2 per cent raises the question whether fuel suppliers will supply an increasing amount of renewable bioethanol.
“The Government’s own Transport Energy Task Force recommended that increasing the amount of renewable bioethanol into petrol to ten per cent would be the most cost-effective way to reduce carbon emissions from petrol.
“If this fuel is not introduced this would destroy an immediate route to low carbon fuels and improved air quality.
“Our AD biogas producers will also be disappointed that their biomethane, largely derived from food and organic farm waste, will not qualify as a Development Fuel. Renewable gas can play a major role in decarbonising the heavy transport, a major contributor of carbon emissions.”