Germany no Longer Plans to Add Ethanol to Petrol

Environment Minister Sigmar Gabriel said the decision was taken because 10 per cent ethanol in petrol would rot the hoses and gaskets of millions of auto engines. But he said an order for diesel fuel to contain 7 per cent ethanol remained in place.

Gabriel rejected accusations of blundering and cast blame on car manufacturers for not telling him in time that 3 million engines were vulnerable if the current ethanol supplements were increased.

He said he refused to force millions of German motorists to buy a more expensive, ethanol-free grade of petrol.

At a news conference, he acknowledged the wider criticism of ethanol, saying, "It's now being asked if producing ethanol actually causes more damage to the climate than the fuel it is meant to replace."

The change of mind over petrol means Germany must reduce its overall 2009 target for biofuel addition to motor spirits from 6.25 per cent to 5 per cent, as measured by by energy yield, Gabriel said.

But he insisted a European Union target of 10 per cent overall by 2020 remained achievable. The conversion to ethanol had been hailed as an indirect way of reducing Europe's carbon-dioxide emissions.

There has been a storm of criticism of Gabriel, a Social Democrat, since he foreshadowed the climbdown on Wednesday. Opponents said he ought to have known much sooner about the ethanol problems.

Biofuel plans are under attack round the world because of forest clearances and because of the recent run-up in world grain prices. India banned rice exports Monday in response to the shortage.

Economists say the diversion of land to fuel growing is reducing the world's potential to grow food at a time when grain demand in Asia is soaring.

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