The estimated cost to taxpayers of a flagship Government policy for promoting biofuels has almost doubled while the forecast carbon savings it will deliver have been cut, it has emerged.
The predicted cost of the Renewable Transport Fuel Obligation (RTFO) has risen by 87% from £203 to £380 per tonne of carbon emissions saved.
Meanwhile, estimated carbon savings are down from one million tonnes a year to 700,000-800,000 tonnes.
The RTFO is intended to reduce greenhouse gas emissions from the transport industry by increasing use of biofuels.
From April 2008 it will place an obligation on fuel suppliers to ensure that 2.5% of forecourt sales comes from biofuels.
This will rise to 3.75% in 2009 and 5% in 2010.
Retailers who do not supply the fuel can buy-out of the obligation at 15p for every litre of fuel from non-renewable sources.
According to Government figures the transport sector is responsible for 25% of emissions. A saving of one million tonnes in carbon emissions is equivalent to taking a million cars off the road.
In a written statement, junior transport minister Jim Fitzpatrick said: "The Government has revised downwards its estimate of the carbon savings that the RTFO is likely to deliver and has revised upwards its estimate of the total costs of the policy."
Total net savings from the RTFO are now estimated at 2.6 to 3 million tonnes of carbon dioxide (700,000-800,000 tonnes of carbon) per annum in 2010/11.
