Huge growth in ‘home-brew’ biofuel plants is expected

NO duty will be payable on a business’s annual biofuel production up to 2,500 litres from tomorrow (Saturday 30th).

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The new government regulations about to come into force are expected to open up the market for biofuel production in the UK and result in an ‘explosion’ of ‘homebrew’ plants.

Until now, the law has required anyone producing any quantity of a biofuel – which happens to be mostly biodiesel in the UK – to pay duty of around 28.35p on every litre they produce. In addition, they must submit returns to HM Revenue and Customs and hold a permit.

But the new rules give a production threshold of 2,500 litres per annum, below which producers will not need to submit returns or pay duty. There will also be a reduction in the frequency of returns for all but the largest producers (producing over 450,000 litres per year) from monthly to quarterly.

It is understood there are about 1,400 producers of biofuels in the UK with a large proportion of these making the fuel their own personal use.

The change in regulation effectively means that many users will now have the opportunity to produce enough biofuel for their own use, duty free.

The government says the effectiveness of the 2,500- litre level will be monitored and it will consider the scope for raising the threshold a year after its introduction.

• The full implications for this legislative change will be discussed and debated in workshops at the Biodiesel-Expo 2007 (www.biodiesel-expo.co.uk) which will take place at the Newark Showground on October 17 and 18.