Press Release - DfT announces biofuels reforms

Posted in: biofuels

The DfT has announced its intention to raise the target under the RTFO, paving the way for future growth of the UK biofuels industry.

York, 15th September 2017 - Following years of policy uncertainty and market stagnation, the Department for Transport (DfT) has announced its intention to raise the target under the Renewable Transport Fuel Obligation (RTFO), paving the way for future growth of the UK biofuels industry.

The Government response to its consultation on proposed amendments to the Renewable Transport Fuel Obligations Order has indicated that the target level under the Obligation will rise to 7.25% from April 2018, further increasing to 9.75% in 2020 and to 12.4% by 2032. By providing long term certainty, the DfT hope to encourage future investment in a sector that investors have been steadily losing faith in.

However, the Government has imposed restrictions on how this target can be met, limiting the contribution that crop-based biofuels can make towards the obligation to 4% in 2020, steadily declining to 2% in 2032. This will inevitably place a significant demand on waste biofuel feedstocks, notably on used cooking oil. Waste oils already provide close to 700 million litres of the UK’s biodiesel supply, with consumption likely to more than double over the next few years if targets are to be met. Over the longer term, demand for waste feedstocks will continue to increase as the RTFO target level increases and crop cap reduces, posing a potential risk to circular economy efforts to reduce waste generation. Due to these conflicting interests, it remains vital that robust verification processes are enforced to ensure that waste biofuels are produced from legitimate waste streams.

Meanwhile, there remains criticism from industry that the crop cap is too low and that it could unnecessarily restrict the market for biofuels that can demonstrate significant GHG savings and provide a meaningful contribution to the UK economy, such as wheat bioethanol. There are equally concerns that this policy will limit the UK’s competitiveness, with other EU member states likely to enforce a crop cap set at 7%, as mandated under the EU Indirect Land Use Change (ILUC) Directive.

Further to these changes, the UK has agreed the implementation of a new sub-target within the obligation, focused on encouraging investment in fuels that meets the DfT’s long terms strategic aims of decarbonising the heavy goods vehicle and aviation sectors and encouraging innovation in the UK fuels sector. The new ‘Development Fuel’ sub-target will provide support to a range of high-blend renewable fuels produced from wastes, including bio-substitute natural gas, renewable hydrogen, renewable aviation fuels and any other fuel that can be blended above 25% and still meet relevant fuel standards. However, additional support will not be provided to biopropane, hydrogenated vegetable oil, biobutanol and biomethane from anaerobic digestion, as was originally proposed. The target will rise steadily from 0.1% in 2019 to 2.8% in 2032, providing demand for upwards of 500 million litres of ‘development fuel’ by 2030.

Most of the fuels supported under the sub-target are not widely available commercially and so it remains difficult to predict how the target will impact the fuels industry and ultimately whether it will encourage UK investment in new fuel technologies. Regardless, it remains a bold attempt by the Government to support truly innovative and sustainable fuel technologies.

With the changes due to be enforced from April 2018, we can but hope that after suffering many years of difficulties the UK biofuels sector can now begin to flourish, setting an example for other bio-based industries to follow.

The full Government response to it consultation on proposed amendments to the Renewable Transport Fuel Obligations Order can be found here.

For more information:

Notes to editors:

NNFCC is a specialist bioeconomy consultancy based in York, the UK.  Established by the UK government in 2003 as the National Non-Food Crops Centre, NNFCC has grown to become a leading independent consultancy focused on understanding biorenewable markets and technologies.  They provide global clients with a holistic view of feedstock, technology, policy and market development across the bioeconomy, enabling informed business decisions and sustainable business strategies.  NNFCC also provides technical, market and policy expertise on the conversion of biomass and waste to bioenergy, biofuels and biobased products to the UK government.  See more at


You may also be interested in: