Work has started on the UK's first bioethanol production facility which will use sugar beet previously destined for the world market. British Sugar is building a �20m plant to produce 70m litres of green fuel at Wissington, Downham Market in Norfolk.
Farmers across Norfolk, Cambs and Suffolk will grow the sugar beet.
British Sugar chief executive Mark Carr said Government backing for "renewable" transport fuels was crucial to the firm going-ahead with the unit.
The plant takes up all the UK produced sugar previously destined for the world market which, under a recent World Trade Organisation ruling, cannot now be exported.
Mr Carr said: "Site preparation work has already begun and I expect to have this plant in production early in 2007.
"This is the UK's first bioethanol production facility - the beginning of an exciting new industry.
"It is a clear demonstration of our innovative approach to the changing business environment in which we operate."
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