The government is contributing £25m towards the construction of advanced biofuel demonstration plants in the UK from 2015.
The capital funding for waste-to-biofuel pilot plants was announced by transport minister Norman Baker on 1 August.
The Department for Transport’s planned investment in advanced biofuels also has the backing of energy and climate secretary Ed Davey.
The fund will be used to demonstrate the commercial viability of biofuel production from materials such as municipal waste and forestry residues. Finance will be provided over three years for suitable industry projects selected by open competition.