Barry Ward (Dún Laoghaire, Fine Gael)
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208. To ask the Minister for Transport, Tourism and Sport if his attention has been drawn to the price volatility of hydrotreated vegetable oil fuel for transport; his views on whether, if the price per litre is consistently more than the price of diesel, it will act as a disincentive; and if he will make a statement on the matter. [47931/25]

Darragh O'Brien (Dublin Fingal East, Fianna Fail)
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The Renewable Transport Fuel Policy 2025-2027 provides future certainty to fuel suppliers on the projected biofuel blending obligation in road transport fuel to meet 2030 decarbonisation and renewable energy targets. The Policy informs commercial planning and management of any associated market costs by fuel suppliers, potentially mitigating against wholesale price spike impacts on consumer pump price because of compliance with the blending obligation.

Furthermore, the biofuel blending obligation is designed to encourage market action among fuel suppliers to find the most economic and cost-effective means to meet the obligation. The obligated parties have a variety of renewable fuel pathways to meet the obligation, e.g., supply of ethanol in petrol, biodiesel (FAME up to a 7% blend) or hydrotreated vegetable oil (HVO) in diesel, etc., incentivising a competitive market to deliver increased renewables in transport.

There are many inputs to total fuel price, of which biofuel cost relative to fossil fuel is only one. Taxes and levies raising funds for wider public services also make up a large proportion of the fuel price at the pump. The carbon tax component of motor oil tax is not applied to renewable biofuels such as HVO.

The Department of Finance July 2025 paper to the Tax Strategy Group notes that Consumer Price Index information from the CSO is not available for HVO as it is not yet seen as a broad range consumer good. Nor is pricing information available from the Department of Climate, Energy and the Environment’s energy update data. However, anecdotally, HVO currently retails at over 10 cent per litre more than regular auto diesel.

Under the Renewable Transport Fuel Policy my Department will pursue an assessment to establish a means to track the price impacts of market intervention through the blending obligation. My Department continues to engage on an ongoing basis with the Department of Finance and the Department of Climate, Energy and the Environment concerning possible impacts of the Renewable Transport Fuel Policy delivery in this regard.

Barry Ward (Dún Laoghaire, Fine Gael)
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209. To ask the Minister for Transport, Tourism and Sport his views on the use of hydrotreated vegetable oil fuel for transport as an alternative to diesel; if his Department is carrying out research into the merits of promoting its use at a national level; and if he will make a statement on the matter. [47932/25]

Darragh O'Brien (Dublin Fingal East, Fianna Fail)
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The Renewable Transport Fuel Policy 2025-2027 sets out a pathway to incentivise supply of renewable fuel in transport through annual increases in the renewable transport fuel obligation (RTFO) rate to 2030 to achieve Climate Action Plan biofuel targets and European targets for renewable energy in transport as set out in the Renewable Energy Directive, as well as ensuring EU sustainability and greenhouse gas emissions reduction criteria are adhered to.

The RTFO places a statutory obligation on suppliers of road transport (fossil) fuels to ensure that a proportion of the fuels they place on the market in Ireland is produced from renewable sources. Renewable transport fuel, including HVO, used in transport which fulfils EU criteria for sustainability and greenhouse gas emissions reduction is eligible for RTFO certificates and can be counted against the obligation.

Corresponding to an RTFO rate of 21% by energy in 2024, a physical blend of approximately 10% biofuel in diesel was achieved in road transport, of which approximately 7% was FAME biodiesel and 3% was HVO blended in diesel. It is expected that further increases in the RTFO rate projected to 2030 under the Policy will see a physical blend in the region of 13% HVO in diesel in the State.

The National Oil Reserves Agency (NORA) is responsible for administration of the RTFO, the award of RTFO certificates for each megajoule of renewable fuel supply. The NORA also advises the Minister on RTF Policy. The 2022 Biofuels Study examined projected demand for biofuels and available sustainable supply and production capacity to meet that demand to 2030.

This study has been built upon in 2024 through a NORA analysis on the role of advanced biofuels and renewable fuels of non-biological origin in meeting 2030 sub-targets under the Renewable Energy Directive. Further, analysis supplied by the NORA in August 2025 focussed on the potential for a higher 2030 biofuel target in the Climate Action Plan. This analysis notes that increasing biofuel blending in road transport must be balanced with consideration of sustainability of the biofuel supply from 3rd countries relative to potential available indigenous sources of supply of renewable fuel.

Noting the projected future cross-sectoral demand for HVO, my Department under the current Renewable Transport Fuel Policy commissioned a study on the hierarchy of use of HVO across transport and other sectors. The study will inform the continued rationale for State intervention through blending targets and incentives promoting the most efficient use of HVO across transport modes and non-transport sectors relative to the alternative renewable energy options in each sector. The study is expected to commence in the final quarter of 2025 and it is anticipated that it will take approximately six months to complete.

The Department of Finance July 2025 paper to the Tax Strategy Group notes that the 2025 Programme for Government includes a commitment to examine the taxation of HVO used specifically for commercial freight to support sustainable transport solutions in that sector. The Department of Finance, in conjunction with Revenue, as well as other relevant Departments and agencies will consider options in this regard; however, it is important to note that there are potential State Aid considerations, administrative difficulties and an Exchequer cost.

Renewable transport fuels will remain an important transition measure in transport decarbonisation in the coming years as the shift to electrification and further increases in public transport and active travel are fully realised. Sustainable renewable transport fuels, including HVO, provide immediate climate-change mitigation utilising the existing vehicle fleet. Ireland’s policy on renewable fuels will continue to promote future supply of sustainable advanced biofuels and renewable fuels of non-biological origin.