More restrictions on rebated fuel usage

What has changed?

From 1st April 2022, most businesses that previously used rebated (red) diesel and biofuels are no longer allowed to do so. From this date, white diesel or biofuels, carry the full rate of duty.

What is red diesel?

Otherwise known as gas oil or tractor diesel, red diesel is intended to be used in non-road mobile machinery and is taxed at a lower rate to road diesel. There are strict restrictions on when red diesel can be used, and these limits increased significantly on 1st April 2022. Many businesses have been impacted.

Why have the rules changed?

These duty changes are part of the government’s aim to bring the UK’s greenhouse gas emissions to net zero by 2050 – a target that is set in law. The changes are also intended to support another of the government’s objectives to cut air pollution to save lives.

Red diesel makes up around 15% of all diesel use in the UK and is responsible for producing 14 million tonnes of CO2 a year. Reducing the entitlement to red diesel is a way to incentivise businesses to scale down their diesel usage altogether.

If your business has its own net zero targets, we can help you reach them with a tailored a four-step sustainability plan. With the help of World Kinect Energy Services, we will create a strategy to reduce your carbon footprint, achieve carbon compliance, reduce your energy use, source renewable energy and offset remaining carbon emissions.

How will the red diesel changes affect businesses?

If your business is losing its entitlement, you will face significant cost increases. White diesel duty currently attracts a fuel duty rate of 52.95 pence per litre – 42.77 pence per litre higher than the duty rate of red diesel.

From 1st April 2022, it became illegal to put rebated fuel into your vehicles, vessels, machines or appliances that are not allowed to use it. There are steps you can take now to mitigate the impacts of the duty increases.

Adapting to the changes takes time. We encourage our customers to speak to us now so we can help you find ways to reduce the impact of additional costs.

Speak to our experts

Which businesses do the changes affect?

Every business in every sector should look into how their operations will be impacted because the new rules are wide reaching.

Some businesses can continue using rebated fuel, but for very specific purposes.

These businesses include those in:

  • Commercial boating, including fishing and inland water freight industries and passenger ferries
  • Non-commercial power generation, such as hospitals and off-the-grid households
  • Agriculture, forestry, horticulture and fish farming
  • Rail transport
  • Non-commercial heating, such as places of worship and town halls
  • Travelling funfairs and circuses
  • Amateur sports clubs, including golf courses

The rebated fuels affected by the changes include:

  • Red diesel
  • Hydrotreated vegetable oil (HVO)
  • Biodiesel and bioblend
  • Fuel substitutes

If your business falls within one of these categories, you should visit the government website to make sure you’re familiar with the specific requirements for using rebated fuel.

Contact our team

Solutions to help you switch in the most efficient way

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Switching to Furnaceflame

Furnaceflame isn’t affected by the duty changes, so consider using it for commercial heating applications.

Commercial Heating Oil
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Protecting your budget

If your budget is impacted, we can give you more price certainty with our risk management solutions.

Price Risk Management
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Safe, secure storage

We can audit your storage set-up and advise you on maintenance and security to protect your fuel.

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Streamlining your entire spend

To ease the impact of cost increases, our experts can assess your energy bills to identify potential savings.

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Reaching sustainability targets

Using our specialist knowledge, we can help you measure and reduce the carbon impact of your fuel use.

Sustainability Solutions

Consider your transition


The demand for organisations to become carbon neutral is increasing, and these new changes will put more pressure on businesses to change the way they operate to reach net zero.

Our sustainability experts can help you progress on your targets. Through choosing the right lubricants for your vehicles and proper fleet care, you can improve your fuel efficiency. Our colleagues at World Kinect Energy Services can give you tailored energy efficiency tips, which can also help you cut costs.


When you switch fuels, it is the ideal time to consider lower-carbon alternatives, such as HVO.

Although subject to the duty changes, alternative fuels can deliver the efficiency benefits of improved performance, better cold weather properties and low sulphur combustion.

We’re here to support your business, through the red diesel duty changes and towards a sustainable future. Get in touch with our experts to find out more.

Frequently asked questions

  • Red diesel is another name for gas oil or agricultural diesel. It is typically used in off-road transport, power generation and for some commercial heating or burning appliances. Because red diesel attracts a lower duty rate, there are restrictions on when it can be used. It is dyed red so that the authorities can spot illegal usage, hence the name, red diesel.