Bans palm oil for biofuels

The European Union Commission bans palm oil for biofuels

The European Commission says that oil palm cultivation has resulted in excessive deforestation. That is why its use for transportation fuels must be abolished.

Quoted from Reuters, the conclusion was issued by the European Commission on Wednesday (03/13/2019). They determine the criteria for which plants contribute to environmental damage.

The criteria are arranged in the framework of establishing the Renewable Energy Directive II (RED II) law, to increase the use of renewable energy to 32 percent by 2030. The European Union Government and Parliament have two months to decide whether to accept or will veto the Commission's decision.

In the draft law, the use of more dangerous biofuel raw materials will be phased out in 2019 to 2023. Then reduced to zero by 2030.

The Commission finds that 45 percent of the expansion of palm oil production since 2008 has caused damage to forests, wetlands or peatlands, and the release of greenhouse gases. This amount is greater when compared to the contribution of soybeans by 8 percent and sunflowers by around 1 percent.

The European Commission sets at least 10 percent as a minimum limit of raw materials that endanger the environment.

But producers who can show that they have increased crop yields without the need to expand to non-agricultural land will get an exception. Expansion of such plants will be considered less dangerous, if for example carried out by small farmers or leads to the use of abandoned land.

The law immediately caused controversy in Indonesia and Malaysia. The two largest palm oil producing countries in the world threaten to bring this matter to the World Trade Organization (WTO).

Malaysia and even the middle who are trying to limit the import of French products as a retaliation (retaliation) for the country's plan to remove palm oil from biofuel options in 2020.

The Campaign Movement for Environmentally Friendly Transportation assesses that labeling palm oil as an environmentally unfriendly product is an important milestone in the struggle to recognize the climate impact of the plantation business.

However, the movement also considered the victory was not yet complete, because soybean oil and palm oil could still be labeled "green".

Earlier, Coordinating Minister for Economic Affairs Darmin Nasution assessed the draft European Union Commission regulation regarding RED II was discriminatory and aimed at benefiting other vegetable oils produced in the European Union (EU).

Because, continued Darmin, the EU limits and prohibits the use of palm oil-based biofuels using the Indirect Land Use Change (ILUC) scheme. In fact, scientifically speaking, the ILUC methodology is still questionable and is a unilateral concept that attacks palm oil.

Therefore Indonesia and Malaysia and Colombia agreed to reject the black palm campaign in the European Union. The agreement was the result of a meeting of the 6th Ministerial Meeting of the CPOPC (Council of Palm Oil Producing Countries) 27-28 February 2019 at Mulia Hotel, Jakarta.

"The ministers view this draft regulation as a political compromise on the internal EU that aims to isolate, and exclude palm oil from the EU biofuel sector that benefits other vegetable oils, including EU-produced rapeseeds," Darmin said.

The ban on the use of crude palm oil-based biofuels by the EU has an impact on Indonesia's exports of these commodities.

According to data from the Central Statistics Agency (BPS) in 2018, the total volume of palm oil exports to Europe reached 4.8 million tons, down 5.8 percent from 2017. In value, 2018 palm oil exports reached US $ 3 billion or down 15.9 percent from US $ 3.6 billion.

petroNAD's president director
Iskandarali Johan