Question to the Department for Transport:

To ask the Secretary of State for Transport, what assessment he has made of the effect of the European Fuel Quality Directive Article 7a (a) on petrol prices and (b) generally.

The Government takes the environmental implications of exploiting high carbon intensity crudes very seriously and fully supports the aim of the Fuel Quality Directive to reduce carbon emissions. We also believe that the accounting methodology must be proportionate in the burden placed on suppliers. The European Commission's proposals for a greenhouse gas intensity accounting methodology to implement Article 7a failed to receive agreement in 2012, and we await the publication of a revised proposal and impact assessment.

The Department consulted on measures to implement Article 7(a –e) of the Directive between March and June 2011. The core costs envisaged in the impact assessment relate to putting in place a 6% greenhouse gas emissions savings target to 2020, the supply of biofuels and other compliance measures required to achieve these reductions. The costs of delivering such measures are subject to a very high degree of uncertainty given that EU negotiations on key elements for implementing the Directive have not yet concluded. Based on a range of provisional assumptions, it was estimated that, relative to the cost of policy currently in place, the impact in 2020 would be an increase of 0.5 pence per litre on petrol and 2.5 pence per litre on road diesel. A full analysis is presented in the impact assessment published on 10 March 2011 which can be found at:

https://www.gov.uk/government/consultations/consultation-on-proposals-to-implement-articles-7a-to-7e-of-the-eu-fuel-quality-directive-fqd-directive-98-70-ec-as-amended-by-2009-30-ec-requiring-suppliers-to-reduce-the-lifecycle-greenshouse-gas-intensity-of-transport-fuels-and-introducing-sustaina.

The UK has not yet set a trajectory for biofuel supply to meet the 6% greenhouse gas emissions savings target required in 2020. Any associated increase in targets for the supply of biofuel and other compliance measures would be the subject of a further consultation and a revised impact assessment which would carefully consider the impact on the motorist and the environment.