20th January 2023


From the UK Government Department for Business, Energy, & Industrial Strategy (BEIS):

Government to support British industry in cutting fossil fuels with £32.5 million.

  • New government funding will support British industries, including construction, mining and quarrying, to reduce their reliance on fossil fuels
  • Support will develop greener alternatives to red diesel such as electrification and green hydrogen, providing a pathway for industry to cut their emissions and energy costs
  • This is the UK government’s latest step in driving industrial energy independence and encouraging green investment across the country

British industrial sectors, including construction, mining and quarrying, will be supported in their plans to develop greener technologies and low carbon fuels, as the government backs industry with a £32.5 million funding package to cut reliance on fossil fuels and boost energy resilience.

The funding announced today (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 £32.5 million package will support 3 to 5 demonstration projects that participated in Phase 1 of the programme.

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, supporting the UK’s commitment to transition away from red diesel to help meet its climate change and air quality targets.

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.

Graham Stuart, Minister for Energy and Climate change

The funding announced today follows £6.7 million funding 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.

Originally published Jan 20, 2023 3:18:07 PM, updated April 24 2024.