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High-end luxury carmaker Bentley has announced plans to power all of its vehicles on biofuels and to reduce carbon dioxide output from its cars to an average of 120g/km from 2012.

Speaking at the Geneva Motor Show, chief executive Franz-Josef Paefgen said the company would make all of its engines capable of running on renewable fuels. "We will set a benchmark in our segment of the industry," he said.

Bentley, owned by Volkswagen, intends to improve efficiency in its eight and 12 cylinder engines, and also make improvements to drivetrain and transmissions to improve CO2 emissions by 15 per cent by 2012.

Paefgen said it would also introduce a new powertrain by 2012 which would give a 40 per cent reduction in fuel consumption while retaining the same performance as present engines.

Finally, all the engines used by Bentley would become compatible with the use of renewable fuels, primarily biofuels, by 2012. He said: "It is our conviction that renewable fuels, in particular second-generation biofuels, have strong potential. On a well-to-wheel basis such fuels can deliver a consistently high net CO2 reduction of up to 90 per cent.