||Biofuels offer one method for decreasing emissions of carbon dioxide (CO2) from fossil fuels, thus helping to meet UK and EU targets for mitigating climate change. They also provide a rational option for land use within the EU that could be economically viable, provided that an appropriate financial and policy environment is developed. If 80% of current set-aside land in the UK were used for production of biomass crops for electricity generation, about 3% of current UK electricity demand could be met from this source. Considering possibilities for increasing yields and land area devoted to such crops over the coming decades, this could possibly rise to 12%. These estimates exclude consideration of developments in electricity generation which should increase the efficiency of conversion. Also, the use of combined heat and power units at local level (e.g. on farms or in rural communities) gives additional energy saving. Dedicated biomass crops such as willow, poplar, miscanthus, switchgrass or reed canary grass are perennials: in comparison with annual arable crops they would be expected to deliver additional environmental benefits. The elimination of annual cultivation should give a more stable environment, beneficial for farmland biodiversity. Some increase in soil organic matter content is likely, leading to some sequestration of carbon in soil and long-term improvements in soil quality. The impact on water quality may be positive as nitrate losses are small and a similar trend is expected for phosphate and pesticides. However, these crops may well use more water than arable crops so their impact on water resources could be negative 2013 an issue for further research. Agricultural land can also be used to produce liquid fuels for use in transport. At present biodiesel can be produced from oilseed rape and ethanol from either sucrose in sugar beet or cellulose from virtually any plant material. In the short-term, liquid biofuels are an easy option as they require little change to either agriculture or transport infrastructure. However, their benefits for CO2 emissions are much less than for biomass used for generating electricity. It is therefore necessary to debate the priorities for land use in this context.