UFOP welcomes German minister’s initiative to exempt biofuels from tax when used in agriculture

The Union for the Promotion of Oil and Protein Crops (UFOP) announced May 4 that it strongly supports the proposal made by Germany’s Federal Minister of Agriculture Alois Rainer to exempt biofuels from energy taxes in order to make their use in agriculture more attractive.

This aligns with the call in the federal government’s coalition agreement to promote the use of alternative fuels, including biofuels.

Rainer is responding to a longstanding demand by UFOP to clear the way for the use of sustainably certified biofuels in agriculture.

The conflict in the Middle East currently demonstrates how quickly and effectively supply chains once believed to be secure can be disrupted and become a pawn of the parties to the conflict.

This should be the final impetus to leverage the existing potential at both the national and EU levels and deploy it specifically where it can make a tangible contribution to securing fuel supplies, reducing costs and improving farm liquidity, UFOP stated.

In a networked bioeconomy, this would simultaneously enable the greatest contribution to value creation and climate protection, in line with the agricultural sector’s obligations.

At the same time, UFOP said it shares the minister’s holistic approach of including, in addition to biofuels, drive systems that can be electrified on farms in the considerations.

UFOP emphasized that the multitude of existing options on farms must be developed and promoted in the best possible way through integration.

The association recommended continuing cooperation with the Board of Trustees for Technology and Construction in Agriculture (KTBL) in this area.

The catalog of measures developed by KTBL on behalf of Germany’s agriculture ministry for the gradual introduction of biofuels in agriculture provides a comprehensively coordinated framework of action areas that must be taken into account to ensure that the transition can be implemented as smoothly as possible, UFOP stated.

The association emphasized that the requested tax exemption for biofuels not only represents a step toward strengthening the energy supply but also makes an important contribution to greater self-sufficiency in the supply of domestic feedstuffs through the coproducts associated with the processing of agricultural raw materials.

UFOP said it expects that a tax exemption introduced in this country would motivate other EU member states to create a similar support framework.

The energy sector is important for buffering the supply of raw materials to stabilize producer prices and for developing additional opportunities for value creation on farms.

The latter, however, requires reliable framework conditions, UFOP noted.