EU says palm oil diesel a climate catastrophe but leaves loopholes open

Pressure is mounting on EU officials to remove several loopholes in its plan to phase out subsidies for biodiesel produced from palm oil. Earlier this month the European Commission took the landmark decision to stop palm biodiesel from counting towards meeting EU renewable energy targets. But, facing trade war threats from the governments of Malaysia and Indonesia, it included an exemption for additional palm oil produced in independent small plantations (less than five hectares) or produced on ‘unused’ land.

Since then there have been widespread calls on the Commission, including from MEPs, to close these loopholes which could result in Europe using the same amount of palm oil in diesel that it does today. Both of the MEPs leading on the file, Socialist José Blanco and Green Bas Eickhout, have urged the Commission to revise the draft in order to get the Parliament’s support. European big farmers’ lobby group Copa and Cogeca and the German Farmers Association (DBV) called for the certification criteria to be strengthened to avoid palm oil slipping through.

T&E said that the size of a plantation has no relation to the risk of deforestation or the changes in land use. In fact, small lots of land toiled by workers who sell to a single big mill controlled by corporations is the business model of palm oil giants like Malaysia’s FELDA/FGV, which produces more than half of its palm oil that way.

Also the areas of so-called ‘unused’ land may actually be in use by local communities to provide themselves with food or fresh water. These areas may also have been brought into production anyway to meet the ever-increasing demand for food. T&E said that the Commission’s proposed delegated act doesn’t provide sufficiently robust criteria to prevent abuse, or a proper monitoring and enforcement system.

The Commission also exempted soy – a major contributor to deforestation worldwide – from the high ‘ILUC’ risk category. However, the Commission’s own study which found that biodiesel from palm oil is three times worse for the climate than regular diesel also found that soy biodiesel is two times worse.

A recent study reviewing the latest scientific evidence on deforestation found that a significant share of palm oil and soybean expansion happens on land with high-carbon stocks – rainforests, forests, peatland and savannahs. Drawing on satellite assessments, it estimates that 31% of palm oil expansion globally takes place on forests, while 23% occurred on peatland (some of which overlaps with forest conversion). At least 7% of global soybean expansion caused direct deforestation in the period 2012 to 2015, the report found.

Until 8 March the delegated act will be the subject of a public consultation that is expected to attract responses from across the continent. The international coalition of NGOs #NotInMyTank have created the site notinmytank.com to help concerned citizens take part in the consultation. So far 650,000 Europeans have signed petitions calling for an end to subsidies for palm oil diesel.

T&E’s clean fuels manager, Laura Buffet, said: ‘The Commission gives with one hand what it takes away with the other. You can’t label palm oil diesel as unsustainable and then open a loophole as big as the current consumption levels. This decision is arbitrary and needs to be revised.’

The progressive phase-out of the use of the highest emitting biofuels or ‘high ILUC risk’ biofuels by 2030 was agreed by the European Parliament and national governments in June last year.

Since the EU revised its Renewable Energy Directive last year, France has taken measures to eliminate palm oil from biofuels after 2020 and Norway has said it would end support to biofuels with a high risk of deforestation in 2020. The EU is the second largest importer of crude palm oil in the world, and the majority of those imports (51%) are currently subsidised to make ‘green fuel’.

Laura Buffet said: ‘The Commission is asking Europeans whether they think burning palm oil in cars is a good idea. There’s no doubt what the answer will be. Europeans don’t want this. The real question is whether President Juncker and Vice-president Timmermans will listen to citizens and their democratic representatives or whether they’ll bow to the Trade Commissioner Malmstrom who’s desperate to do a trade deal with the palm oil nations.’

Once the Commission adopts the act, EU member states and the European Parliament have two months to pass or veto the act, but they have no power to amend the rule.