Rape methyl ester (RME) is a suitable substitute for mineral diesel in existing compression-ignition engines. Ifs use as an alternative transport fuel will result in decreased emissions of atmospheric pollutants (particularly SO2, hydrocarbons and smoke) from this source. However, to encourage such a trend in the UK, the Government needs to adopt the European Union＇s recommendation of a reduction of excise duties on biofuels to 10% of the rate applied to lead-free petrol to ensure its economic short-term competitiveness in the UK market. Such a subsidy will not be required by the year 2004. The available resource base for rape-seed oil in the UK limits the production of RME, so it could satisfy only up to 4% of demand on fuel by road vehicles powered by diesel engines in the UK. This suggests that it should be used preferentially in urban areas and waterways where its environmental benefits would be maximised.