The government should consider making changes to its Renewable Transport Fuel Obligation (RTFO) to avoid using more expensive ethanol fuel, largely sourced from the US.
With a new obligation for 5 per cent of transport fuel to be taken from renewable sources, coming into force from April this year, the UK could be about to increase its use of corn-based ethanol.
But by modifying the existing RTFO, which has been in force since 2008, the country could encourage the use of cheaper and more sustainable sources of renewable biofuels, according to new research from the independent think-tank, Chatham House.
Since 2008, the RTFO has required a bigger and bigger percentage of renewable fuel to be mixed into the UK’s transport fuel, now rising to 5 per cent and planned to reach 10 per cent by 2020, in order to meet EU obligations for renewable fuel use.
Chatham House says that the Government should instead have a energy content target or set specific targets for ethanol or biodiesel in order to meet EU renewable fuel obligations.
According to Reuters
, a spokesperson for the Department for Transport said any percentage increase this April in the RTFO should have little impact on fuel prices for motorists.
“The government will closely monitor the price at the pumps and the impact this has on families and businesses," the spokesperson added.
In recent years, the UK has been making greater use of ethanol while the percentage share of biodiesel in our transport fuel has been falling. According to government data used in the report, ethanol increased its share of UK biofuel supply from 41 per cent in 2010 to around 61 per cent by 2012 , while biodiesel's share in the same timeframe, declined to around 35 per cent from around 60 per cent in 2010.
While ethanol is a cheap fuel to buy, it has a lower energy-value than petrol, making it the most expensive renewable fuel to use, according to Chatham House’s report.
In 2011-12, supplying 10 per cent of transport fuel from renewable sources would have cost around $1.8 billion using biodiesel, compared with $2.3 billion using ethanol, the report says.
Biofuels including corn ethanol also face questions over their sustainability, having been blamed for pushing up food prices and displacing food production from agricultural land.
"Our research shows that biofuels derived from agricultural crops offer poor value for money as a means to reduce emissions and can have serious consequences for food prices," said Rob Bailey, senior research fellow at Chatham House and author of the report.
"The UK's heavy reliance on corn ethanol is a particular concern in this regard. Biodiesel produced from waste cooking oil is a more sustainable option and offers cheaper emissions reductions," he added.Source: Reuters.
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