The Government’s initial target for petrol and diesel to contain 3.4 per cent biofuel by 2012 has sparked interest from a number of suppliers who had previously regarded the New Zealand market as too risky.
"It provides a signal that there will be sufficient demand to get serious about this market,” said Peter Neilson, CEO of the Business Council for Sustainable Development.
He said the market could be attractive if the price of oil stayed at $US50 to 60 a barrel over the next few years, and some of the experimental technologies for biofuel proved sound,
Meanwhile, the AA has said it “cautiously supports” the biofuel initiative, “provided the outstanding technical, infrastructure and cost issues can be resolved.”
Among its concerns are that biofuels shouldn’t cost more than existing fuels; shouldn’t compromise vehicle performance, including fuel economy; damage engine components or invalidate warranties. Biofuels would need to be clearly labelled at the pump, and mineral petrol should be retained as an alternative for incompatible vehicles.