In brief...
The Department for Transport is are consulting on future biofuel policy in the UK up to 2020, and beyond to 2030. The proposals include the setting of the controversial crop cap, which will limit the amount of crop-based biofuels which can be used on UK roads.
We need your help to explain to the DfT why the biofuel industry is important to farmers.
The Consultation has now closed but you can read the NFU response here or in the related documents section of this page (you will need your membership login details).
What is the DfT proposing?
Following the adaption of the Indirect Land Use Change (ILUC) Directive in Brussels, all EU member states are required to introduce a crop cap of up to 7%. This cap will effectively limit the amount of crop based biofuels able to be used on domestic roads.
In its current consultation, the DfT has proposed options of 0%, 2% and 7% with 2% noted as their preferred option.
The NFU believes the crop cap should be set at 7%. Setting it any lower would further constrict the UK biofuel industry and would place us at a competitive disadvantage to our European neighbours; it could also risk the UK not achieving its domestic and European renewable energy targets.
The biofuel market is a key outlet for UK arable production and when faced with volatile commodity prices it provides stability to arable farming incomes; hence it is vital for the market to remain open and incentivised.
How can I get involved?
The NFU will respond to the consultation. However, we want your help in demonstrating the importance of this issue to the agricultural industry.
The consultation covers much more than just the crop cap and so with this in mind we suggest you write a letter tailored to specific sections rather than responding to the whole consultation. In your letter you must to state that you are responding formally to the RTFO consultation and in particular you will be responding to Question 13, relating to the level at which to set the crop cap.
What should my letter say?
Personal letters always have the most impact so we are not producing a template to follow, but we have pulled together some key facts and questions you could consider when writing your letter:
- How and why is the biofuel market important to your business?
- What would the impact of losing the biofuel market be on you and your business – would you still grow the same crops? If so, where else could or would you market your crops?
- We consider the biofuel industry as having a stabilising impact on farm incomes – putting a floor in the market – has this security enabled you to make on farm investment and better business decisions?
- Markets - If running at full capacity the two bioethanol plants would use 2.2m tonnes of feed wheat and currently 40% of UK grown OSR is exported to other member states for processing into biofuels. If the biofuel industry were to constrict this would therefore severely impact already volatile commodity markets – it is estimated access to the biofuel markets add £10/t to wheat and £12/t to rapeseed prices.
- Brexit - poses much uncertainty for farmers and therefore more than ever they need security in their markets, with volatile commodity prices and the future of agricultural support unclear the need to make a return from the market becomes even more vital.
- Sustainability - The EU Commission set strict sustainability criteria for biofuel feedstock, if you are a Red Tractor member and pass your annual audit you meet these requirements. This compliance is demostrated when you sign Section 8 on your grain passport.
- Animal feed - Approximately 1m tonnes of high protein animal feed is produced as a co-product of domestic bioethanol processing; this is enough to feed approximately 40% of the UK dairy herd. Currently the UK imports c.70% of its high protein feed, this is primarily soy based. The cost of animal feed is the single largest item of expenditure recorded in a farms cost base and the EU and UK reliance on imported protein has continued to drive up the price of animal feed for livestock production. A sustainable biofuels industry plays a vital role in narrowing this deficit improving the UK balance of payments and benefiting both livestock and arable producers.
We have also produced a briefing which can be accessed in the related documents section, below This sets out further background information you could use when writing your letter or it could be included as reference material.
Who should I write to and when is the deadline?
You should address your letter to: Michael Wright, Department for Transport, Great Minster House, 33 Horseferry Road, London, SW1P 4DR
Or email it to: TG93Q2FyYm9uRnVlbC5Db25zdWx0YXRpb25AZGZ0LmdzaS5nb3YudWs=
You could also consider sending a copy of the letter to your local MP, find out their contact details here. The consultation closes on Friday 22 January.