The Red Diesel Replacement (RDR) programme aims to support the development and demonstration of low carbon fuel and system alternatives to using red diesel in the construction, and mining and quarrying sectors. The programme promotes the decarbonisation of these high-impact sectors, which are affected by partial removal of the entitlement to use red diesel and rebated fuels which was effective from April 2022.

Programme aims

• develop commercially viable and globally applicable low-carbon alternatives to red diesel, looking at long-term solutions
• demonstrate an integrated, low-carbon solution at a moderate scale on site for the mining and quarrying sector, and the construction sector
• accelerate the commercialisation of low-carbon red diesel alternatives
• disseminate the learnings and results of the RDR programme to international stakeholders, industry and other sectors which use middle distillate fuels
• inform policy team on the potential of low carbon alternatives and create awareness of the spin-off opportunities for other sectors (for example maritime, agriculture and road freight)

In total, £33 million in grant funding washas been awarded to 22 innovation projects across the 2 phases of the programme, both of which are closed.

Phase 1 (closed November 2021)

£6.7 million was awarded in grant funding across 16 projects, with up to £460,000 available per project.

Phase 1 projects developed component technologies which were at technology readiness level (TRL) 4 or above at project start and within one of the following 3 innovation lots:

• Lot 1: Distribution, storage, and energy delivery systems development
• Lot 2: Development of equipment (components/sub-systems) and fleet management infrastructure (facilities for maintaining, hosting and servicing vehicles)
• Lot 3: Fuel development

The projects developed understanding of the core and ancillary technology, the technology, market potential, route to market (including competition) and costs associated, as well evaluating further development needs which could form a Phase 2 or future project.

Phase 2 (closed March 2023)

Around £25.7 million in grant funding was awarded to 6 projects with £1 million to £12 million available per project. This leveraged around £14.2 million of private investment through match funding provided by projects.

Phase 2 projects seek to demonstrate an integrated, low-carbon, end-to-end system / solution to replace existing red diesel-using technologies on an operating construction, mining, or quarrying site. This includes engineering design, build, trial, decommissioning, market assessment, and knowledge dissemination. On completion, their solution should reach technology readiness level (TRL) 7 or above. Projects run until March 2025.

The programme is funded as part of the £1 billion Net Zero Innovation Portfolio (NZIP), which runs until 2025.