Each new 2005 Liberty common rail diesel (CRD) sport-utility vehicle for the US market will be fuelled with 5% biodiesel at DaimlerChrysler's Jeep plant in Toledo, Chrysler Group said.

Biodiesel fuel is produced from vegetable oil, in this case soybeans grown in the Liberty plant's home state of Ohio. The first Liberty diesel will be produced in November though Cherokee-badged versions for export have been made for a couple of years.

"This is an important first step in encouraging wider use of these clean, renewable, environmentally-friendly fuels in the United States," Dieter Zetsche, Chrysler Group president and CEO, said in a statement.

The Jeep Liberty diesel, the first diesel-powered mid-size SUV to be offered in the United States, will hit the market in late 2004. It will be powered with an Italian-made VM Mottori 2.8-litre four-cylinder engine and equipped with automatic transmission and standard four-wheel drive.

The Liberty CRD diesel will achieve a claimed 22 mpg city and 27 mpg highway in the US, overall approximately 30% more fuel-efficient that the petrol Liberty's 3.7-litre V6.

In addition to 30% reduction in fuel consumption, diesel engines also reduce emissions of greenhouse gases by 20% compared with petrol engines, Zetsche said .

"With biodiesel, we can increase these benefits even further.  And because biodiesel is made from renewable resources, we further reduce our dependence on petroleum for our transportation needs," he said.

Biodiesel fuel reduces emissions of particulate matter, hydrocarbons and carbon monoxide. In addition, the biodiesel portion of the fuel is virtually carbon dioxide-neutral; that is, the amount of carbon dioxide released when the fuel is burned is matched by the amount of carbon dioxide absorbed by soy plants during growth.

Dodge Ram diesel pickup trucks have run successfully on B20 (20% biodiesel) in fleets required to use alternative fuels by the US Energy Policy Act of 1992 (EPACT). However, there are currently no standards to guarantee consistent quality of B20 fuels. Thus, DaimlerChrysler currently recommends its diesel vehicles be run on a biodiesel blend of maximum 5% (B5).

The company is working with the biodiesel industry, petroleum industry, government, and standard-setting organisations to establish standards for biodiesel.

Conventional diesel fuel is currently available in about one-third of all service stations in the United States.

Biodiesel blends of up to 5% concentration (B5) are available in public fuelling stations at certain locations across the country, particularly in areas with substantial soybean farming. B5 fuels are already widely used in Chrysler Group diesel engine vehicles in Europe, where DaimlerChrysler has gained considerable experience with the fuels.

Next year, 2% biodiesel (B2) will be required for all diesel fuel in the state of Minnesota. Missouri and Delaware are considering similar mandates.