The Government is set to introduce a new form of “cleaner” petrol aimed at drastically cutting carbon dioxide emissions.

Transport Secretary Grant Shapps said the government was consulting on plans for the E10 fuel – a lower carbon fuel using 10% ethanol – to become the standard grade of fuel at British filling stations from next year.

E10 is regular unleaded petrol blended with 10 per cent bioethanol, fermented from feed wheat grown by farmers.

The new petrol had the potential to reduce CO2 emissions from cars and motorcycles by some 750,000 tonnes per year, or the equivalent of taking around 350,000 cars off the road, Mr Shapps said.

Petrol grades in the UK currently contain up to five per cent bioethanol, known as E5. This proportion would be increased to 10% through E10, a blend already used in countries including Germany, France, Belgium and Finland.

Mr Shapps said the proposed new fuel was the latest in a series of steps to help the UK move towards “a net zero future”.

Ethanol producer Ensus UK said the announcement was a major step in making fuel more green.

“We welcome today’s announcement as the availability of E10 will instantly make petrol a lot cleaner, providing significant carbon reduction benefits to our environment on the long road to net-zero emissions by 2050,” the company’s commercial director Grant Pearson said.

“It is vitally important to protecting and potentially growing jobs in this industry, including many in the supply chain, and will bring tangible benefits to UK farmers and environmentally-conscious motorists.”

The Department of Transport said the announcement is the latest measure to support the “decarbonisation of transport” including funding for pioneering low carbon fuels, which are expected to save nearly 85 million tonnes of CO2 between 2018 and 2032.