It is a great pleasure to serve under your chairmanship, Mr. Amess, and to have the opportunity to contribute to this most important debate. Mr. Drew rightly mentioned the need for balance in the debate. That is crucial, because what we are talking about is self-evidently not a black and white issue.
I thank Mr. Yeo and the Environmental Audit Committee for their hard work on the topic, which is especially relevant in the context of the European Union's current consultation on a directive on the issue. We can no longer afford to get our environmental policies wrong. We all agree that climate change needs to be tackled effectively here and now. The Committee's report is useful and gives us insights on the background to biofuels.
I should make it clear from the beginning that, although I agree that the report lays out in some detail the problems that can be caused by biofuels, the Liberal Democrats believe that those problems are surmountable and that the United Kingdom cannot afford to write off biofuels altogether as a viable option for powering transport. We are, therefore, not minded at this stage to support the Committee's call for a moratorium. We Liberal Democrats believe that there is an important role for good, sustainable biofuels to play in the UK transport fuel market and that abandoning the targets completely would be a step backwards for the UK's sustainable energy industry and for its ability to control its carbon footprint.
All hon. Members are, of course, aware that transport is responsible for roughly a quarter of the UK's total carbon emissions, with road transport alone responsible for more than 21 per cent. That figure has not decreased in recent years, but has risen as more people have cars and use them more often, so it is vital that Britain is carbon neutral by 2050, including transport. We therefore need a solution—or perhaps I should say solutions—to the problem of powering transport, especially road transport.
As hon. Members have said, new technologies are developing all the time. Just a few years ago only one hybrid car was available in the showrooms—the Prius—but now the consumer can choose between many models. There are also advances in electric cars that could come from entirely green energy sources, including hydrogen technology and, of course, sustainable biofuels. There is other encouraging news. Yesterday, I noticed in the Financial Times that for the first time in 26 years the Ford pick-up truck was replaced as the USA's No. 1 seller by the smaller, more environmentally friendly Honda Civic. In the UK we have seen a dramatic increase in the sales of hybrid cars. Those facts point to a positive trend. People are starting to vote with their feet and their wallets on environmental issues. We need to take advantage of that movement to help cut carbon emissions as much as possible.
Despite certain media reports, it is too simplistic to generalise about whether biofuels are a good or bad thing. Of course, we are well aware that biofuels are not completely carbon neutral as yet, but they can create carbon savings when compared directly with fossil fuels. Whether they create carbon savings, and what the size of those savings is, depends entirely on how and where the raw materials are grown and how they are converted into biofuels and then transported. The true carbon cost of any biofuel can only be calculated if the carbon cost of growing it, including the machinery and fertilisers used, converting it and then transporting it are all taken into account. We must include the carbon cost of any change in land use.
There are other environmental and social costs attached to biofuels that are important for us to understand, acknowledge and attempt to address. If biofuel farms replace rainforest or peat land, it can take hundreds of years to replace the carbon cost. The unique eco-systems, wildlife and biodiversity of that land can never be replaced. We cannot and must not allow the use of such land to continue.
Biofuels also compete with food for the land that is used to grow them. Just this week, as was mentioned earlier, concerns were expressed at the UN food summit in Rome about the security and scarcity of food supplies. Although I am sure that biofuels are not the only or main reason for the current food crisis facing the world, using land currently utilised for agricultural purposes to grow fuel—almost literally—can only exacerbate the problem. We must work to ensure that does not happen.
The problems are real and serious, and they are troubling for anyone who advocates the use of biofuels, but we firmly believe that they can be minimised if good standards are firm and regulations are put in place. Like the Committee, we believe that a total moratorium on the UK's 5 per cent. target for the use of renewable fuels is not only impractical if we want the UK to reach its CO2 reduction target of 60 per cent. by 2050, but also that it is not sensible if we wish to make further developments in the field of sustainable technology. The truth is that companies will simply not invest in research and development for sustainable fuels and carbon-saving measures if they do not believe that the United Kingdom Government are serious about carbon reduction.
The problems can be tackled in other ways that could allow biofuels to be used. As it stands, the renewable transport fuel obligation is not doing enough to ensure the sustainability of the biofuels that we are using. We need stronger certification and sustainability standards that will incentivise energy companies to ensure that the biofuels provided come from the best and most sustainable resources. As the report clearly indicates, carbon savings from biofuels are possible. Some UK biofuel factories already run an incredibly good sustainable business and produce high quality biofuels. According to the Renewable Energy Association, British Sugar in Wissington, Norfolk—to name but one such company—produces a biofuel from locally grown sugar beet that, including all the carbon production costs, has a 71 per cent. carbon saving over fossil fuels.
The Government should set a minimum standard of 50 per cent. carbon saving for biofuels when compared with fossil fuels, and it should be in place now. In our view, anything below that level would be unsustainable. Although we welcome the idea of rewards being linked to CO2 emissions caused by producing biofuels, such a system should already be in place and we should not have to wait until 2010. In addition, we should not—nor should the European Union—subsidise fuel from unsustainable resources, as we are currently doing.