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Motorists will fill their vehicles as normal, but the change is expected to save 2.5million tonnes of carbon dioxide by 2010.

It is part of a package of measures being taken to reduce the impact of transport on the environment.

Suppliers are required to produce sustainability reports including information on where their biofuel crops come from and the level of carbon savings they will achieve. The Renewable Fuels Agency will publish these reports and compare the performance of transport fuel suppliers.  If the supplier does not supply fuel with 2.5% biofuel, it has to buy credits from other suppliers.

Alongside this, a review into the indirect impacts of biofuels has already been announced by Transport Secretary Ruth Kelly to ensure that the full economic and environmental impacts of biofuel production are taken into account in the formation of UK policy beyond 2010.

Transport Minister Jim Fitzpatrick said:
"Making it easier for motorists to use greener fuel is an important step towards reducing carbon emissions from transport. It should help save millions of tonnes of carbon dioxide in the coming years.

"But we must do all we can to ensure biofuels are produced sustainably. We know people are concerned about the environmental risks associated with expanding biofuel production and we take those concerns very seriously.

"That is why we want to introduce mandatory standards as soon as possible to guarantee that biofuels don't cause deforestation or food shortages and we are leading international work to do this. In the meantime, we require suppliers to produce sustainability reports, providing an immediate incentive for them to source biofuels responsibly."

Phil Woolas, Minister for the Environment said:
"Emissions from transport need to go down if we are to make serious headway in tackling dangerous climate change and this initiative has the potential to deliver considerable carbon savings.

"Obviously sustainability needs to be at the heart of all biofuel production and it will remain at the forefront of all policy development in this area. We must be able to produce biofuel without causing a negative impact on our natural environment."

Sustainability of Biofuels
Responding the the introduction of the RTFO, Greenpeace said, "The law does nothing to prevent biofuels grown on newly deforested land from being sold in the UK. Suppliers are only required to "report" the details of the crops they are using - a process which can be easily manipulated to hide the true origin of environmentally damaging crops like palm oil."

The Government admits there will be no sustainability standards for biofuels in place until at least 2011.

Greenpeace's Senior Forests Campaigner Belinda Fletcher said:
"Right now, rainforests are being destroyed to make way for biofuel crops in places like Indonesia. This destruction leads to massive greenhouse gas emissions and completely undermines the point of these so called 'green fuels'.

"The government claims its plans will promote the best biofuels, but in reality there is nothing to stop the use of crops like Indonesian palm oil being pumped into our fuel tanks. At a time when the world's leading scientists are warning us of the madness of cutting down rainforests to grow crops for fuel, to press ahead with these plans is incredibly reckless.

"The real solution is staring us in the face: make cars far more fuel efficient."

In March, a report by the Netherlands Environmental Assessment Agency found that the climate has more to gain from converting biomass into electricity, than to use it to replace petrol or diesel concluding that "proposals to replace current transport fuels by biofuels are not the best investment in sustainability."