Grant funding to target lower carbon, lower cost red diesel alternatives


On 27 September, the first phase of the BEIS £40mn Red Diesel Replacement (RDR) competition will launch with the publication of competition guidance documents.

Non-road mobile machinery tends to be the main use for red diesel, accounting for 15% of all diesel currently used in the UK. It is expected that these sectors will switch to using regular diesel in the near-term, resulting in cost increases and continued greenhouse gas emissions, with private investment into red diesel replacements unlikely to happen at the pace needed to realise net zero by 2050.

This is something the RDR competition will aim to address, providing £40mn in grant funding for projects that can develop and demonstrate lower carbon, lower cost alternatives to red diesel for the construction, and mining and quarrying industries.

In the competition’s £9.2mn initial phase, up to £460,000 will be awarded to projects that can develop technologies within any of the following three innovation lots: distribution, storage and refuelling systems development; development of vehicle and fleet management infrastructure; and fuel development. In the £30mn second phase, up to £15mn will be awarded to projects able to demonstrate a low carbon integrated system, including elements of the technology lots from the first phase on a construction and mining/quarrying site.

Technologies with a clear progression pathway in reducing carbon emissions, air pollution and reliance on biomass at every step will be supported through the competition, with the eventual objective of deploying a low carbon, zero biomass solution in the long-term. The long-term energy pathways that could enable this include direct electricity, batter, hydrogen, e-diesel, e-methanol, e-methane and ammonia.