Olwyn Enright (Laois-Offaly, Fine Gael)
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Question 15: To ask the Minister for Communications, Marine and Natural Resources if support for biofuels here is on a par with the encouragement available in other European countries; and if he will make a statement on the matter. [14509/05]

Bernard Allen (Cork North Central, Fine Gael)
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Question 33: To ask the Minister for Communications, Marine and Natural Resources the extent to which his Department or other agencies under his aegis have had discussions with producers of biodiesel or other biofuels; the likely role for such alternative fuels in the future; and if he will make a statement on the matter. [14493/05]

Michael Ring (Mayo, Fine Gael)
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Question 47: To ask the Minister for Communications, Marine and Natural Resources the number of bodies, agents or agencies with whom he or agencies under his aegis have had discussions with regard to the future production of biofuels; the outcome of such discussions; and if he will make a statement on the matter. [14518/05]

Trevor Sargent (Dublin North, Green Party)
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Question 96: To ask the Minister for Communications, Marine and Natural Resources the reason he restricted the excise duty exemption on bioethanol and biodiesel to 1 million litres each, in view of the fact that such fuels can be used in any vehicle once blended with conventional mineral oils and that the existing sugar beet industry here has the capacity to deliver 600,000 tonnes of sugar beet to produce such products; if he expects to achieve the targets set out in the 2003 biofuels directive that 5.75% of diesel and petrol sales in 2010 come from biofuels. [14554/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 146: To ask the Minister for Communications, Marine and Natural Resources the extent to which his Department or other agencies under his aegis have had discussions with producers of biodiesel or other biofuels; the likely role for such alternative fuels in the future; and if he will make a statement on the matter. [14724/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 162: To ask the Minister for Communications, Marine and Natural Resources if support for biofuels here is on a par with the encouragement available in other European countries; and if he will make a statement on the matter. [14740/05]

Bernard Durkan (Kildare North, Fine Gael)
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Question 167: To ask the Minister for Communications, Marine and Natural Resources the number of bodies, agents or agencies with whom he or agencies under his aegis have had discussions with regard to the future production of biofuels; the outcome of such discussions; and if he will make a statement on the matter. [14748/05]

Noel Dempsey (Meath, Fianna Fail)
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I propose to take Questions Nos. 15, 33, 47, 96, 146, 162 and 167 together.

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 that was launched by my Department on 20 April. Interested parties have been invited to apply for excise relief through a competitive call for proposals process. Under the scheme, excise relief may be granted for pilot projects producing up to 6 million litres of pure plant oil, 1 million litres of biodiesel and 1 million litres of bioethanol.

When the Finance Act measure was originally negotiated with the Department of Finance in 2003, the level of interest expressed to the Department in developing biofuels, in particular bioethanol and biodiesel, was considerably lower than is currently the case. Since the Finance Act measure was first announced interest in biofuels has grown considerably but the Finance Act measure relates to pilot projects only.

The primary focus of interest expressed to date has been in the biodiesel and pure plant oil sectors. In respect of bioethanol, I understand that Irish Sugar plc intends to process Ireland's full sugar quota at its Mallow plant. Production of bioethanol from sugar is more expensive than production from wheat and would be a commercial decision for any potential developer.

Biodiesel, bioethanol and pure plant oil 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 and comprising officials from Sustainable Energy Ireland, SEI, the Department of the Environment, Heritage and Local Government, the Department of Transport, the Department of Agriculture and Food and the Department of Finance. The group is considering policy options for the development of a biofuels sector in Ireland. As part of the group's work, a liquid biofuels strategy study was published by 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.

My Department is responsible for the promotion and development of renewable energy, including biofuels and I am committed to the development and promotion of a biofuels market in Ireland's transport fuel sector.

Sustainable Energy Ireland is also funding a number of biomass projects and studies through its renewable energy research development and demonstration programme. Under the programme, Sustainable Energy Ireland offers capital grant aid for biofuels market demonstration projects in the pure plant oil, biodiesel and bioethanol categories. Funding of €250,000 has already been awarded by SEI to one company which is demonstrating the feasibility of producing and selling vegetable oil locally as a transport fuel. It is intended that further grant aid will be available under the programme for biofuel demonstration projects.

It is anticipated that these initial measures will lead to market penetration of biofuels of 0.13% within two years. Further measures to increase market penetration over a longer timeframe are currently being considered.

The biofuels directive sets indicative targets for market penetration of 2% by end 2005 and 5.75% by end 2010. The targets in the directive are indicative and not mandatory and most member states, including Ireland, would not be in a position to meet the 2% target by end 2005. Ireland is starting from a very low current production base, and the 2% target therefore represents a considerable challenge.

Under the EU biofuels directive, member states were required to submit a report to the Commission in 2004, giving details of current market penetration of biofuels and projected targets for 2005. The reports by member states are now available on the Commission's website and indicate that market penetration of biofuels is also low in many other EU member states. Only six countries have identified current market penetration levels of 1% or higher, with a further 12 countries, including Ireland, identifying current market penetration levels ranging from 0% to 0.7%. Only 21 member states have reports posted on the Commission's website.

Member states have reported using a variety of mechanisms to stimulate biofuels market penetration ranging from introducing exemptions from excise duty on biofuels, special tax rates on biofuels, grant assistance and certificate obligation systems but most member states are still at a very early stage in developing biofuels policy.