The Government has announced details of a two year programme of excise relief, worth €3m per annum to support the use of bio-fuels.

Bio-fuels are renewable transport fuels, which have significantly less carbon dioxide emissions than their fossil fuel equivalents.

The Minister for Communications, Marine and Natural Resources, Noel Dempsey, said the exemption would cover 12 million litres of vegetable oil, two million litres of bio-diesel and two million litres of bio-ethanol.

The Irish Farmers’ Association has welcomed the announcement, describing it as a boost for a fledgling bio-fuels industry.

IFA vice president Raymond O'Malley said Irish agriculture had a major role to play in the development of a sustainable bio energy industry.