In the past few days the dust has begun settling after Alistair Darling's first budget and it's become clear that the Fife MP has pushed the pause button on the Government's all-out support of biofuels. What's worth noting is the Chancellor has abolished the UK government's financial support of biofuels - the biofuels duty differential - in favour of something called the Renewable Transport Fuel Obligation (RTFO). The move should save the Government more than half a billion pounds by 2010.

While Mr Darling acknowledging "biofuels have the potential to make a significant contribution towards reducing emissions in the transport sector," he also referred to incentivising "only the most sustainable biofuels, by shifting support away from the duty differential to the Renewable Transport Fuel Obligation in future years". The RTFO forces fuel suppliers to ensure that 5% of the fuels they provide is biofuel. The removal of the subsidy means motorists will end up paying more for the same amount of fuel.

And what's the reason behind this change of tact? Essentially it's as a result of something called the King Review, an article produced by Julia King, vice-chancellor of Aston University. In her report, commissioned by the Government, she stresses her beliefs that factors such as change in land usage, nitrous oxide emissions from fertiliser use, processing methods and transport can significantly reduce the savings in greenhouse gas emission from using biofuels. In his Budget of course, Mr Darling being the clever politician he is, stated that "the Government believes it is important that policy supports sustainable biofuels." Yet his announcement that Ed Gallagher, chairman of the Renewable Fuels Agency, would lead a study of the wider economic and environmental impacts of biofuel production, including the impacts on food prices, speaks volumes of the new direction and the future price at the pump.