Bernard Durkan (Kildare North, Fine Gael)
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Question 189: To ask the Minister for Communications, Marine and Natural Resources his policy to promote the production of bio-diesel and other alternative fuels; and if he will make a statement on the matter. [11456/05]

Noel Dempsey (Meath, Fianna Fail)
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In March 2004, my Department secured an amendment to the Finance Act 1999, which provides for the introduction of a pilot scheme for excise tax relief for biofuels. The European Commission has now given State aid clearance for the scheme. The pilot scheme will be publicly advertised very shortly and interested parties will be invited to apply for excise relief, through a competitive "call for proposals" process.

Biodiesel, along with other types of biofuels, are addressed in the EU biofuels directive. This directive sets indicative targets for the market penetration of biofuels in member states.

An interdepartmental group has been set up, chaired by my Department, to consider policy options for the development of a biofuels sector. As part of the group's ongoing work, a liquid biofuels strategy study was published by Sustainable Energy Ireland, SEI, in December 2004. This report provides comprehensive details on the potential for the development of a biofuels market in Ireland and options to stimulate the market.

In relation to other alternative fuels, Sustainable Energy Ireland was established under the Sustainable Energy Act 2002 to promote and assist in the sustainable production, supply and use of energy in support of Government policy. A number of SEI research, development and demonstration programmes are currently in operation across all sectors of the economy addressing these strategic objectives.