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Mistake in rules hits biofuel firms

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Biofuel companies are being forced out of business by a mistake in drafting the rules covering their introduction into the UK fuel supply, the Renewable Energy Association (REA) has claimed.

The rules say a small but rising percentage of fuel must be obtained from biological sources such as sugar beet or maize, according to the Renewable Transport Fuels Obligation (RTFO).

But the drafting mistake means that fuel that already contains some biofuels at the point it is logged - even just "a thimble-full" - is not covered by the rule.

REA`s Clare Wenner says she had been told that it is not possible to correct the mistake until next April, when the speed of introduction of the fuels is also likely to be changed.

As a result, she says, far less biofuel is needed than the 2.5% obligation introduced in April this year, forcing companies that supply it to lay off workers or close down altogether.

Slowing the introduction of biofuels by increasing the required percentage to 5% over a longer period was recommended by the Gallagher review into the indirect impacts of biofuels earlier this year.

© Press Association 2008