Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what assessment he has made of the potential merits of removing duty for (a) hydrotreated vegetable oil and (b) other renewable liquid fuels for home heating purposes.

Hydrotreated vegetable oil is a direct substitute for diesel and it is therefore taxed at the rebated rate for diesel when it is used for home heating. There are no duty incentives for renewable fuels used as a direct substitute for diesel, and it would be difficult to legislate for a complex scale of duty rates to be applied to different hydrocarbon oil products. The Government will keep this under review to determine whether there is a case to make changes to the taxation of this fuel.

The UK is the first major economy in the world to legislate for net zero emissions by 2050 and the Government’s Renewable Heat Incentive, currently worth over £1 billion per year, supports households to install renewable heating systems such as heat pumps and biomass boilers. The forthcoming Heat and Building Strategy will set out the Government’s position on the transition to low carbon off gas-grid heating, but fiscal decisions are a matter for Budgets.