Dáil Éireann Debate, Wednesday - 8 February 2006
243 Mr. Eamon Ryan asked the Minister for Communications, Marine and Natural Resources if, following provision for excise relief on biofuels in the Finance Act 2004, it was not until August 2005 that any excise relief on biofuels was granted to a small number of biofuel producers; the reason this administrative task took 17 months; and his views on whether such a delay is acceptable. [4597/06]
Amharc ar fhreagra244 Mr. Eamon Ryan asked the Minister for Communications, Marine and Natural Resources if, in view of his announcement of €20 million excise relief on biofuels for 2006 the date by which this excise relief will be granted to biofuel producers on foot of this announcement. [4598/06]
Amharc ar fhreagra245 Mr. Eamon Ryan asked the Minister for Communications, Marine and Natural Resources when growers will know whether or not they will be entitled to excise relief on their crop due to the fact that liquid biofuel crops have been sown in the spring. [4599/06]
Amharc ar fhreagraI propose to take Questions Nos. 243 to 245, inclusive, together.
The Finance Act 1999 was amended in 2004 to provide for the introduction of a pilot scheme for mineral oil tax relief for biofuels to underpin a pilot project designed either to produce biofuel or test the technical viability of biofuel for use as motor fuel. It was then necessary for my Department to devise a scheme and agree it with the Department of Finance. A commencement order, to be signed by the Minister for Finance, was required before the provision in the Finance Act in relation to biofuels could be implemented. The requisite state aid clearance was sought from the European Commission in December 2004 and approval was received in March 2005.
The scheme was publicly advertised as a competitive call for proposals on 20 April 2005 and the closing date for receipt of applications was 13 May 2005. A total of 34 applications were received under the call for proposals by the closing date. The volume of applications received was much higher than had been anticipated. The assessment panel met on several occasions to assess and score the applications. Letters of offer were issued to the eight successful applicants in August 2005 and the pilot scheme will continue until July 2007.
Building on the success of the pilot biofuels scheme, I have agreed with the Minister for Finance a further targeted package of excise relief valued at €205 million, which was announced in the budget. The new excise relief programme, which is also subject to state aid approval, will be rolled out from this year to 2010 and will enable us to reach the initial target of 2% market penetration by biofuels by 2008. I am also providing funding towards the capital cost of developing biofuels processing facilities, which will critically underpin the excise relief package.
Excise duty is payable on motor fuels, and relief under the mineral oil tax relief scheme applies to biofuels for transport purposes. Excise duty does not specifically apply to any crops, but rather to the fuel produced from energy crops or biomass products. The question of grant support for growing energy crops is not within my remit but would be a matter for the Minister for Agriculture and Food.
