23 Nov 2006

Maxol Secures Extension of Excise Relief on its Bioethanol E85 Fuel.

Maxol is pleased today to announce that it has secured a further extension to its excise relief on Bioethanol E85 until 2008.

Noel Dempsey T.D., the Minister for Communications, Marine and Natural Resources revealed that Maxol would be one of the sixteen biofuels projects to be granted excise relief under a recently launched excise relief programme valued at over €200m.  In 2005 Maxol, as part of an initial pilot scheme, was granted a two year derogation on excise duty on Bioethanol E85 and has since made the fuel available at fourteen service stations with plans underway to make it available countrywide by mid 2007.

Under this new scheme, four distinct types of biofuels will be supported.  These include

  • Biodiesel made from pure plant oil, used cooking oil and tallow, blended with fossil diesel and sold at regular diesel pumps;
  • Biodiesel in higher blends of up to 100% in specific fleets of vehicles whose engine warranties cover these blends;
  • Bioethanol made from wheat, barley, whey and other feedstocks, blended with petrol and sold at regular petrol pumps. Bioethanol in blends of up to 85% in petrol, which can be used in flexible fuel vehicles will also be placed on the market as a result of this initiative. The 2005 Finance Act allowed for a 50% VRT reduction in such vehicles and a number of companies have now launched flexible fuel vehicles on the Irish market;
  • Pure plant oil made from the oilseed rape crop and used in modified diesel engines.

The successful projects cover a broad range of business sectors including renewable energy companies, oil companies, recycling companies and food and farming sector businesses.

Noting that there were 102 applications under the Scheme, the Minister said that he was “greatly encouraged” by the level of interest in developing biofuels facilities to service the Irish transport market, and in the range and quality of applications received. “This scheme has shown that there is a very significant appetite to develop biofuels facilities in Ireland, across a range of market players from farmer groups, to food companies, recycling companies and major oil distributors. In light of the interest expressed, I am confident that we can now forge ahead with new initiatives to further stimulate this growing new market in Ireland.”

When at full capacity in 2008, the current scheme will result in 163m litres of biofuels being placed on the Irish transport market, representing 2.2% of the entire fuel market. It will result in savings of over 1.2m tonnes of polluting CO2 over the five years of the programme. In terms of eliminating pollution, this is the equivalent of taking around 70,000 cars per year off the road over the lifetime of the scheme, and is one of the more significant measures being taken by Government to reduce CO2 emissions as part of its Kyoto commitments.

The Minister established a Ministerial Task Force on Bio-energy in July 2006, in which seven key Government Ministers are participating. The group is currently drawing up a National Biomass Action Plan which will be published before year end. Consideration of further initiatives to incentivise the development of Ireland’s biofuel market is central to the development of this plan.

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