The Renewable Transport Fuel Obligation (RTFO) creates a market for first generation biofuels which in turn helps to set the right conditions for the development of commercially viable second generation biofuels. The UK will be required to modify the RTFO in order to implement the Renewable Energy Directive in 2010. The directive incentivises second generation biofuels through requiring member states to count their contribution towards renewable energy targets as twice those of first generation biofuels. We shall be consulting later this year about how to take forward the implementation of the directive in UK legislation.
In addition the Government have recently announced £20 million of funding for the Biotechnology and Biological Sciences Research Council’s (BBSRC) new Sustainable Bioenergy Centre. This is a £27 million initiative aiming to build UK capacity in bioenergy research. Among other things, it will target research on the development of second generation bioenergy and biofuels. Last autumn the Government also announced that the Department anticipates contributing up to £3 million per year over the next two financial years to the Carbon Trust’s Advanced Bioenergy Directed Research Accelerator. This will allow the Carbon Trust to further increase its advanced bioenergy research and development activities.