On 27th July Tipperary Institute hosted an IrBEA meeting of BioFuels industry representatives and representatives of biofuel customers to discuss the new Biofuel Obligation Scheme.
Under the Biofuel Obligation Scheme (BOS) trading for Irish producers of biofuels will become very difficult, if not impossible.It is widely expected that the main importers of fuel will import pre blended product to fulfil their obligation. This will leave no market (or a very poor market) for trading biofuel certificates.
Under the BOS all biofuel will be subject to MOT at 37c/litre + VAT. This will push the price of biofuel to an un-economic level above that of mineral diesel. The sale of certificates which is supposed to compensate for this price increase cannot be predicted, theoretically the certificates could be worth 40c, however if no market exists they will be worthless.
A number of proposals were put forward to work within the BOS including setting up a certificate trading co-op. It was also stressed that IrBEA can work at European level with AEBIOM to ensure the sustainability criteria of biofuels used under the BOS are stringent enough to favour EU produced and Irish produced biofuels. More details of this discussion will follow in the next few weeks.