German govt cuts 2009 biofuels blending target

HAMBURG (Reuters) - Germany’s government has trimmed its proposed biofuel blend levels in fossil fuels for 2009, the country’s Environment Ministry said on Wednesday.

The cabinet approved a proposal from the ministry that oil refineries would have to mix 5.25 percent biofuels in fossil fuels by energy content in 2009 instead of a previously planned 6.25 percent blend.

From 2010 the biofuel blending level would be increased to 6.25 percent and remain fixed at that level until 2014, the ministry said in a statement.

Biogas produced from biomethane would also be calculated under the quota for the first time provided it is produced using methods which contribute to environmental protection, the ministry said.

The blending quotas will also undergo a general review in 2011. “This will especially involve the question of sustainability of biofuels production,” the ministry said.

Several European countries have scaled back plans to blend biofuels in fossil fuels in recent months because of fears it was contributing to rising food prices.

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Germany also cut blending targets for some gasoline types earlier this year because of fears this would damage the engines of older cars.

Germany’s cabinet also decided on Wednesday to increase taxes on biodiesel by 18 euro cents a liter from January 2009 instead of 21 euro cents.

Germany’s biodiesel industry, Europe’s largest, has been lobbying the government to trim its plans for tax rises on green fuels, claiming that tax rises between 2006 and 2008 have drastically cut sales at petrol stations.

Producers argue that biodiesel needs to be at least five euro cents cheaper than fossil diesel because vehicles consume more of the green fuel. The tax rises mean the price is almost the same.

Reporting by Michael Hogan; Editing by Sue Thomas