Biofuel companies are keen to tap into a Government scheme to subsidise biodiesel production.
Under the scheme, a grant of up to 42.5 cents per litre for biodiesel or biodiesel content of a blended fuel will be available from July to manufacturers that meet the criteria.
It will off-set an existing tax benefit that ethanol has over biodiesel and is the Government's follow-up to dumping legislation setting compulsory minimum levels for biofuel use.
Biodiesel New Zealand, which processes the fuel from recycled cooking oil and rapeseed oil crops grown mainly in the South Island, says the grant is timely and will provide a more positive investment environment.
Chief executive Andrew Simcock says Biodiesel NZ will quadruple its production from one million to four million litres per year, from next month.
It is also doubled the number of farmers it's contracted to grow the next rapeseed crop, to about two dozen.
An Auckland company producing biodiesel from tallow also hopes the scheme will inject some life back into the industry.
Biodiesel Oils halted production when oil companies stopped buying its fuel after the Government repealed the biofuel obligation law.
Managing director Tom McNicholl intends to find out more about the scheme. A series of information sessions begins in Auckland on Friday.