Biofuels Seminar Joint Event with EnviroInnovate at the Birmingham City University Technology Innovation Centre 5th November 2008

1. RENEWABLE
TRANSPORT FUEL
OBLIGATION
Catherine Burke
Partner
Energy and Projects
www.martineau-uk.com
E: lawyers@martineau-uk.com

2. Introduction
• The obligation
• Administration
• European targets
• Sustainability criteria
www.martineau-uk.com
www.martineau-johnson.co.uk

3. Legislation
• Energy Act 2004
• The Renewable Transport Fuel Obligations
Order 2007
– Came into force 27 October 2007
www.martineau-uk.com
www.martineau-johnson.co.uk

4. The Obligation
• Imposed on:
– every transport fuel supplier who in an “obligation period” [15th
April – 14th April]
owns hydrocarbon oil on 5th October (or next working day)

supplies that oil at or for delivery to places in the UK

• Does not apply to a “non-obligated supplier”
– one which supplies less than 450,000 litres
• Deduction for smaller supplier – less than 10m litres
• What counts?
– Fuel for use in road vehicles
– Certain descriptions – biodiesel, biodiesel component of
bioblend, bioethanol, natural road fuel gas
• Person applying must own the fuel
www.martineau-uk.com
www.martineau-johnson.co.uk

5. The Obligation (2)
• For each period 15th April to 14th April (“specified
period”) produce to RFA, by the following 5th
October (“specified date”) RTF certificates
(“evidence”) which
– Is of the specified form and
– Shows that the “specified amount” of renewable
transport fuel was supplied at or for delivery in the UK
www.martineau-uk.com
www.martineau-johnson.co.uk

6. The Obligation (3)
“specified amount”
• 15th April 2008 – 14th April 2009
– 2.5641% (volume)
• 15th April 2009 – 14th April 2010
– 3.8961% (volume)
• Each subsequent “obligation period”
– 5.2632% (volume)
www.martineau-uk.com
www.martineau-johnson.co.uk

7. Administration
• The Office of the Renewable Fuels Agency
• RTF Accounts
– Obligatory accounts
– Optional accounts
• Closure of accounts
• Information from supplier each month
• Report to Parliament
www.martineau-uk.com
www.martineau-johnson.co.uk

8. RTF Certificates
• Application by a supplier
• Issued by the RFA
• Certificate covers each litre of fuel
• Issue recorded in the RTF account of the
supplier
• Transferable between account holders
• Can be carried forward but 25% limit
• Revocation
www.martineau-uk.com
www.martineau-johnson.co.uk

9. Discharging the Obligation
• RFA notifies supplier of
– amount of renewable fuel which should have been
supplied
– RTF certificates held in the supplier’s RTF account
• Supplier surrenders RTF certificates or pays
“buy-out payment” – shortfall x “buy-out price”
• Buy-out price is 35p less duty derogation until
15th April 2010 and is then 30p less duty
derogation
• Interest on late payments
www.martineau-uk.com
www.martineau-johnson.co.uk

10. Re-cycling buy-out payments
• Buy-out fund is allocated amongst complying
suppliers
www.martineau-uk.com
www.martineau-johnson.co.uk

11. Civil Penalties
• Failure to apply for an account within 28 days
• Failure to produce RFT certificate
• Payment of the buy-out amount
• Inaccurate information
www.martineau-uk.com
www.martineau-johnson.co.uk

12. European Targets
• Sustainability concerns
• 10% share of biofuels in transport fuels by 2020
• 5% by 2015
• 40% of this from non-food and feed competing
second-generation biofuels, electricity or
hydrogen
www.martineau-uk.com
www.martineau-johnson.co.uk

13. Sustainability criteria
• Biofuels must save at least 45% of GHG
emissions compared to fossil fuels
• And 60% from 2015
• “social sustainability criteria”
– Respect for land rights
– Fair remuneration
www.martineau-uk.com
www.martineau-johnson.co.uk

14. Catherine Burke
Tel: 0870 763 1552
catherine.burke@martineau-uk.com
www.martineau-uk.com
E: lawyers@martineau-uk.com