BEIS commits £32.5m to support British industry cut fossil fuels


The UK government has committed to a £32.5 million funding package for British industrial sectors, including construction, mining and quarrying, to cut reliance on fossil fuels and boost energy resilience.

The UK government says the funding, announced on Friday 20 January, will help these industries move away from using red diesel, also known as gas oil, which is a type of fossil fuel commonly used for off-road, heavy-duty vehicles and machinery, such as bulldozers and cranes.

The funding is being made available through the second phase of the Red Diesel Replacement Competition, which supports projects that seek to develop red diesel alternatives.

The £32.5m package will support three to five demonstration projects that participated in Phase 1 of the programme, the Department for Business, Energy and Industrial Strategy (BEIS) says.

The BEIS says this next phase of funding will support industry to reduce their reliance on fossil fuels, while also helping to cut industry emissions and energy costs, which will support the UK’s commitment to transition away from red diesel to help meet its climate change and air quality targets.

This latest round of funding will help to speed up industrial decarbonisation.

Commenting on the funding, Minister for Energy and Climate Change Graham Stuart, said: “These industrial sectors, and the jobs they create, are crucial to our economy, and they also have an important role to play in our shift towards a greener, more secure future.

“This latest round of funding will help to speed up industrial decarbonisation, providing industry and consumers with effective low-carbon alternatives to red diesel while boosting green investment to future-proof the resilience of British industry.”

The latest funding follows the £6.7 million provided to 17 winners under Phase 1 of the competition, in areas covering electrification, e-fuels and green hydrogen, as well as technologies that capture and store energy which would ordinarily be wasted from a vehicle or machine.

Friday’s announcement forms part of the £1 billion Net Zero Innovation Portfolio, which the UK government says helps to accelerate the commercialisation of low-carbon technologies, systems and business models in power, buildings and industry.

The UK government says that switching industry to lower carbon fuels, supported through schemes such as the Red Diesel Replacement competition, will be critical for reducing emissions to meet the UK’s net zero objectives.

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