Tanks could be filled with home-grown fuels, but imported soybeans and palm oil could be banned under proposed new biofuel rules.

The Green Party wants to bring back rules that would make oil companies prove their biofuels did not cut down food or rainforests. That would cut out palm oil grown on land cleared of tropical rainforest.

Oil companies would also need to prove biofuel reduced greenhouse gas emissions by at least a third over their lifetime compared with petrol - cutting out biofuel from United States corn, said Green Party energy spokeswoman Jeanette Fitzsimons.

The sustainability rules were dumped when the Government repealed a law change by Labour that would have required oil companies to add biofuel to petrol and diesel.

In May, the Government introduced a scheme to increase biofuels - a grant of up to 42.5 cents a litre for New Zealand-manufactured biodiesel - without sustainability criteria.

Ms Fitzsimons said unscrupulous companies could import soybeans that would otherwise be eaten, or sugarcane from areas of cleared Brazilian rainforest, and still get the grants. The law requires biodiesel to be manufactured - not grown - in New Zealand.

A Green Party bill that would bring back the sustainability rules will be considered by MPs after it was drawn from the member's ballot. It does not set criteria for sustainability but sets up a mechanism for deciding on a set of principles by February 2010.

Biofuel petrol is more widely available in New Zealand than biodiesel.

Gull New Zealand general manager Dave Bodger - whose company sells biofuel blend petrol at about 30 petrol stations - said even with a 42 per cent subsidy, the case for importing tallow or used cooking oil from Australia to make biodiesel was marginal.

He is talking to Fonterra about buying more of its ethanol, made from milk whey left over from ice cream, sports drinks and body-building powder at a plant in Reporoa.

SUSTAINABLE TEST
What the Greens want banned:


* Biofuel that creates more than two-thirds of the greenhouse gas of petrol.
* Biofuel that competes with growing food or grown on land classified as having high value for food growing.
* Biofuel grown on land with valuable biodiversity, for example by clearing tropical rainforest.