After food, the largest market for palm oil is biodiesel. Biofuels are transportation fuels like ethanol and biodiesel that are made from biomass materials. Biofuels have existed as long as cars have existed, but they started gaining popularity with rising oil prices, and growing concerns about global warming. Government mandates requiring the use of biofuels in 64 countries are what drives the biofuel market today.
Ethanol is an alcohol fuel made from the sugars found in grains, while biodiesel is made from vegetable oils, fats (ie-tallow), or greases (ie-recycled restaurant grease). Biodiesel is usually sold as a blend of biodiesel and petroleum-based diesel fuel. A common blend of diesel fuel is B20, which is 20% biodiesel. Burning one gallon of diesel fuel emits about 22.4 pounds of carbon dioxide (CO2) while burning a gallon of B20 results in the emission of about 17.9 pounds of CO2. Biodiesel is considered “carbon neutral” because the CO2 emitted during combustion is offset by the CO2 that was absorbed during the feedstock’s growth. Therefore, a 20% reduction in fossil fuel content results in a 20% reduction in CO2 emissions by carbon neutral standards.
Carbon neutrality is why biofuels are seen as an earth-friendly alternative to fossil fuels. The irony of palm biodiesel is what gets emitted before the seeds are even sewn is often as bad as fossil fuel combustion itself. Rainforest is typically targeted for cropland. The trees are cut down and sold, and the remaining brush is burned in a process known as “slash and burn”. Rainforest is targeted because selling timber helps the farmer survive the 3 to 5 years it takes for his crop to begin producing fruit. Burning forest or peatland was calculated to result in an 86 year or an 840-year carbon debt, respectively. (Science, Fargione et al, 2008). That’s about 1 to 10 lifetimes to repay the carbon debt being created so we can have “sustainable” fuel.
The EU is the third largest global buyer of palm oil. In 2017, the EU imported more than 7.5 million tonnes of palm oil and 51% of that was used to make biodiesel (OilWorld). Palm oil used for biodiesel has increased sharply over the last years while food consumption of palm oil is declining. Most of the growth (87%) seen in 2017 in palm oil was due to biodiesel which is driven by EU fuel mandates. (Transport and Environment). The EU agreed to phase out food-based biofuels like palm oil by 2030, however the details of the phase out remain unclear at this time.
Earlier this year, the US Commerce Department set antidumping duties of 50.71% on palm biodiesel from Indonesia after finding that it was being sold at prices below market value in the United States. So, we are safe for now but how long will that last? The second largest market for palm oil is hidden from consumers who are mandated to buy it. Biodiesel could come from soy, palm, rapeseed and the consumer would not have any idea if their fuel was involved in deforestation, species extinction, greenhouse gas emissions or child and forced labor. Does this seem sustainable to you?