Biodiesel Grants Scheme to be extended

The Biodiesel Grants Scheme will be extended to include sales of biodiesel blends higher than 20 per cent, Minister of Energy and Resources Gerry Brownlee announced today.

The Biodiesel Grants Scheme was introduced in July last year to kick start biodiesel production in New Zealand. Under the present criteria, the biodiesel sold must be used in a blend with ordinary diesel of no more than 20 per cent biodiesel.

"By extending the eligibility to blends up to and including 100 per cent biodiesel (B100), we provide an incentive for those businesses and individuals who are willing and able to use these higher level blends."

The change in the scheme is expected to increase production and sales of biodiesel in New Zealand, Mr Brownlee said.

"High level biodiesel blends and one hundred per cent biodiesel are appropriate for niche applications such as eco tourism. Several businesses have indicated they are keen to use higher level blends and unblended fuel to reduce their greenhouse gas emissions as much as possible, and we don't want to discourage them.

"Biofuels are a renewable transport fuel, and the higher the blend, the greater the environmental benefit."

Six biodiesel producers are registered to take part in the Biodiesel Grants Scheme. Most of the biodiesel that has received the grant to date is made from used cooking oil and oilseed rape (canola) grown as a break crop.

The change in eligibility will take effect from 1 July 2010.

Background:

  • The Biodiesel Grants Scheme is administered by the Energy Efficiency and Conservation Authority (EECA). It allows for grants of up to 42.5 cents per litre to biodiesel producers who sell 10,000 or more litres of eligible biodiesel each month.
  • Funding of $36 million over three years to 30 June 2012 has been set aside for the scheme.
  • Six biodiesel producers are registered to take part in the scheme.
  • EECA recommends consumers check with their vehicle or engine manufacturer and experts with specialist knowledge in the field before using biodiesel or biodiesel blends.