The cost of motoring will rise under a European Union plan to force oil companies to add more biofuel to petrol and diesel, the industry has claimed.

An analysis by the UK Petroleum Industry Association said that drivers of cars built before 2000 would be worst hit because they may have to buy a more expensive type of fuel to avoid damaging their engines.

All drivers will have to fill up more often because biofuels produce fewer miles per gallon.

The Government is also removing the fuel duty discount for biofuel from next year and this is expected to add about 2p a litre to pump prices.

Oil companies have had to spend more than £100 million in the past year on adapting refineries and storage facilities to cope with biofuels. The costs of complying with the EU directive will increase sharply over the next five years and most of the cost will be passed on to drivers.

Biofuel made from crops such as soya, oilseed rape and palm will, in theory, reduce greenhouse gas emissions because the plants absorb carbon as they grow. However, a Friends of the Earth report this week said that biofuels could increase emissions because forests were being cut down to clear land for crops.

The association said that it was planning a publicity campaign next year to educate drivers about the risks of using biofuels. It said that manufacturers’ warranties could be invalidated if drivers bought petrol or diesel with more than 5 per cent biofuel.

Presently, diesel contains about 5 per cent biofuel and petrol 1 per cent. Fuel retailers do not have to reveal the biofuel content if it is 5 per cent or less. Lack of information means many drivers do not realise that they already have some biofuel in their tanks.

The association said that 2.7 per cent of fuel sold at the pumps last year was biofuel, slightly more than the Government’s target for 2008-09 of 2.5 per cent.

Last summer Britain responded to concerns about sustainability by reducing the rate of increase of biofuel consumption in road transport. But all EU countries must comply with a directive requiring 13 per cent of fuel to be biofuel by 2020. The association said that a new EU standard allowing 10 per cent of petrol to be biofuel would be introduced next year.

Malcolm Watson, its technical director, said that drivers of older cars would have to buy “super unleaded”, a higher octane fuel that costs about 6p more per litre, or £3.60 extra to fill a 60-litre tank.

He said that oil companies were planning to increase the biofuel content of ordinary unleaded to 10 per cent while keeping super unleaded at a maximum of 5 per cent.

Mr Watson said that new cars had fuel systems able to cope with higher levels of biofuel but there could be problems with older cars.

The AA said that ethanol, the biofuel added to petrol, could perish rubber seals, corrode metal components and block filters. It said the first sign of a problem would be the engine spluttering, possibly followed by a complete loss of power. Paul Watters, its head of transport policy, said: “Government and industry have failed to explain how much extra people will have to pay and what the risks are to their cars.

“We would urge drivers even now to look at the vehicle log books and check on fuel specifications.”

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