The Republic's first filling station to sell pure plant oil as an alternative to diesel has opened at Ballyhea, Co Cork.
The fuel is made from Irish-grown rapeseed oil.
Minister for Finance Brian Cowen has exempted a limited number of suppliers of pure plant oil from paying excise duty as part of a two-year pilot project.
The Ballyhea garage is selling oil from one such manufacturer, Eilish Oils of Wicklow, at 89.5 cent per litre.
A similar scheme started by Maxol at Beach Road service station in Sandymount, Dublin, is selling bio-ethanol - made from a mixture of petrol and sugar cane - at 98.9 cent per litre.
Some State agencies, including the parks and wildlife service of the Department of the Environment, and Cork City Council are running vehicles on biofuels on a pilot basis.
The Ballyhea filling station is being supplied by wholesaler Great Gas Petroleum (Ireland) Plc, a company which has been set up by a group of petrol forecourt owners.
Great Gas expects to develop a chain of 100 service stations across the country by 2010. They will sell petrol and diesel as well as pure plant oils.
While pure plant oil sells at 89.5 cent a litre the cost of an engine conversion is approximately €1,600 plus VAT for a car or small van.
Gerry Murphy of Great Gas is convinced pure plant oil will become a significant contributor to the Republic's energy requirement in the coming years, particularly as it can be sourced in Ireland.
"Great Gas is proud to be the first forecourt in Ireland to invest in the infrastructure to allow our customers to help save the planet," he said.
Allen Holman of Ecocar.ie, the firm which carries out the conversion work on vehicles, described the development of pure plant oil as a radical move.
He said it was an indication of future trends.
"This will be of practical assistance to Ireland becoming less dependent on energy imports, and deserves much more Government support," Mr Holman said.
