Fuel firms have been set a higher-than-expected target for the supply of biofuels to the UK in 2009/10.
Transport minister Lord Adonis said that firms will be required to source 3.25% of their fuels from materials such as palm oil and sugar beet.
The limit was higher than the initial 3% mentioned during government consultations in order to combat a legal loophole which meant that less renewable fuel was supplied than intended, Lord Adonis said.
Ministers looking at the Renewable Transport Fuel Obligation (RTFO) originally decided that the rate at which biofuels were introduced to the UK should be slowed, after last year's Gallagher Review raised serious questions about their environmental benefits.
The report recommended a 3% level for 2009/10, rising to 5% by 2013/14, after initial proposals from the Government had set a 5% target for 2009/10.
Lord Adonis explained the move reflected concerns raised about the legal definition of hydrocarbon fuels in the RTFO order. He said: "That definition excludes any fossil fuel which is blended with renewable fuel before the duty point.
"The result is that less fossil fuel than was intended is taken into account in calculating suppliers' obligations, and therefore less renewable fuel is required to be supplied than was intended."
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