FINLAND: Biodiesel Breakthrough or Environment Nightmare?

• by Linus Atarah (helsinki)
• Wednesday, December 09, 2009
• Inter Press Service

Palm oil is the main feedstock that goes into the production of NExBTL of which Neste Oil expects to use 50,000 tonnes this year and scale up that figure in subsequent years.

Neste Oil claims that its NExBTL diesel is effective in reducing carbon dioxide emissions — the main green house gas (GhG) tresponsible for global warming — that are spewed into the atmosphere by fossil fuel burning automobiles.

The advantage with NExBTL is that it can be used to run both old and new diesel engines without modification and Neste Oil says it is the first energy company to come out with such a product.

While Neste Oil hopes to reap profits from NExBTL, activists and experts say it could well turn into a future environmental nightmare.

Environmentalists are concerned that the widespread use of NExBTL would add a new demand factor for palm oil — in addition to the cosmetics and the food industry — that would eventually lead to further depletion of rainforests.

Nearly 20 percent of the world’s GhG emissions are due to deforestation while the palm oil and paper pulp industries are the main causes for the vanishing of Asia’s rainforests, environmental campaigners say.

Neste Oil is aware of the problem and its vice-president for sustainability Simo Hokanen says that in the future the company hopes to produce biofuels by other means such as with the help of microbes and enzymes.

NExBTL diesel can be produced from animal fat in industrial waste but Honkanen concedes that it will take another 10 years to reach that stage and environmentalists argue that it may never get there.

Maija Suomela, in charge of Greenpeace’s Palm Oil Campaign in Finland, says: 'The reality is the company has already invested several billion Euros in palm oil so that for the next 10 years Neste Oil would have to rely solely on palm oil for the production of its biofuel, and within that time the rainforests would be gone'.

'There is definitely a need for having a fuel which reduces GhG and which is suitable for all vehicles in the market, that can be used from day one without any technical adjustments in the engines or any other logistical system so there is a huge demand for it even outside Europe,' Honkanen told IPS.

Neste Oil has been running a pilot test for its new biofuel on 300 buses in Helsinki city under an agreement due to end next year, after which the city will decide whether its vehicles would run on NExBTL. Similar pilot tests have been carried out by Neste Oil in Stuttgart, Germany, on new diesel engines.

Based on results from the pilot study, Neste Oil claims that NExBTL’s GhG emissions are 40-80 percent less than fossil fuel diesel. If the entire fleet of 1,400 HKL buses were to run entirely on NExBTL diesel, according to Neste Oil, their carbon dioxide emission would be equivalent to that of 140 buses.

With the development of NExBTL, Neste Oil is set to become the biggest single buyer of palm in the world surpassing Unilever and Nestle, the cosmetics and food giants.

Neste Oil will need nearly two million tonnes of palm oil in the next two years when its palm oil processing facilities in Singapore and Rotterdam are up and running, accounting for about 4.5 percent of total palm oil production.

In a majority decision this month the Helsinki city council demanded an independent investigation into the procurement procedure for Neste Oil’s palm oil-based fuel to ensure that it falls within acceptable standards, and that it is not wreaking ecological and social havoc in Malaysia where the company sources most of its palm oil.

The decision has temporarily thrown a spanner in the works of Neste Oil which has all along resisted attempts to open up its palm oil procurements for inspection, insisting that they are sustainable.

Neste Oil claims its products are sourced from certified plantations or those that have plans to gain certification. 'We have a very strict contract with the suppliers which requires them to be completely transparent and we can always audit their operations,' said Honkanen.

But Thomas Wallgren, Social Democratic Member of the Helsinki city council and the rallying force behind the call for an independent verification of Neste Oil’s procurement performance, says there is very little alternative information from Malaysia about the real impact of Neste Oil’s palm oil procurement.

Friends of the Earth Malaysia (Sahabat Alam Malaysia) has reported that contrary to declarations by Malaysian ministers, from 1997 to 2004 the Sarawak Forests Department licensed out some 2.8 million hectares of largely forest land for 40 plantation concessions of mainly oil palm and fast-growing pulpwood trees.

Human rights groups in the region have also expressed concerns over the plight of migrant workers in Malaysia who they fear are being exploited in plantations because of their vulnerable situation.

'I am proposing that the matter should be examined in detail and clarification be done together with experts, Neste Oil, environmental organisations, and most importantly with different parties in East Asia so that we would produce an enlightened solution on how to proceed from here,' says Wallgren.

Wallgren says that since Neste Oil is emerging as a major buyer of palm oil it should set ethical standards for the rest of the industry.

The certifying global body that oversees the production of sustainable palm oil is the Roundtable on Sustainable Palm Oil (RSPO), a global, multi-stakeholder initiative on sustainable palm oil.

RSPO was set up in 2002 and has grown to include more than 300 members between them, accounting for more than 35 percent of global palm production. They each pledged, according to RSPO, to 'help reduce deforestation, preserve biodiversity and respect the livelihoods of rural communities in palm-oil producing countries'.

However, critics are doubtful of the quality of RSPO certification saying it has too many faults.

For instance, in May this year, the conservation group World Wildlife Fund (WWF) accused RSPO of hypocrisy in claiming to use sustainable palm oil while the fact is that less than one percent of sustainable palm oil produced worldwide has been sold.

According to WWF, 1.3 million tonnes of certified sustainable palm oil has been produced, but less than 15,000 tonnes were sold last year.

Controversies around palm oil production have led the International Finance Corporation (IFC), the private sector loan arm of the World Bank, to announce in September that it will no longer provide funding for palm oil projects Indonesia.

That followed complaints from local NGOs that its investment in palm oil extraction lacked performance standards and led to the destruction of highly valued conservation areas and seizure of indigenous peoples’ lands.

Stockholm, one of Neste Oil’s partners in the pilot tests of NexTL, has also announced that it is pulling out of the project because of concerns about the social and ecological effects of Neste's palm oil in the production areas.

'From a climate change perspective a biodiesel which reduces GhG emission is welcome but NExBTL could as well become the genie that has been let out of the bottle. If it becomes the preferred biodiesel of the future then the pressure to clear rainforests for palm oil production would become nearly uncontrollable,’’ Wallgren said.

© Inter Press Service (2009) — All Rights ReservedOriginal source: Inter Press Service

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