EU plans to mop up palm oil to satiate biodiesel demand

Alternate energy resources get a serious look-in

The European Union (EU), apart from rapeseed oil and soyoil, is now considering use of palm oils to fuel their growing demand of biodiesel, said Raffaello Garofalo, secretary general of the Belgium-based European Biodiesel Board.

At 1.93 million tonne, EU amounted to bulk of the global production of biodiesel at 2.36 million tonne in 2004. US produced about 140,000 tonne and rest of the world 290,000 tonne. Biodiesel production is gaining popularity following rising crude oil prices.

Following its limited quantity, the EU's existing canolaapeseed crop is unlikely to fuel the growth desired in the sector. "Following a good rapeseed harvest in 2004, EU saw its output up by about 20 per cent on year. However, the on-year rise in growth in 2005 was merely 5 per cent," Garofalo said.

"Despite sustainability issues-political as well as technical-the growing demand for biodiesel is forcing us to look for alternatives to rapeseedanola," he said. Political limitations count more than the technical ones, especially in case of palm oils.Domestic industry experts feel India too can benefit from the huge carryover rapeseed stocks, pegged at 33 lakh tonne, for producing biodiesel. The other sources being worked are ethanol for blending with petrol; and jatropha and palm oil for blending with diesel.

Garofalo says firstly, biodiesel growth in EU is backed by national subsidies for sustainable transport and energy independence but also to support local economy and agriculture.

Secondly, it is difficult to imagine that major markets like Germany and France will allow subsidies to be forwarded to countries outside the EU. Thirdly, and lastly, environmental issues are a matter of concern.

Last month, the UK-based non-governmental organisation Friends of the Earth held conversion of forest land in Indonesia and Malaysia to oil palm plantations, responsible for extinction of several hundreds of orangutans.

While the palm oil industry has rubbished the charge saying it has no substance and is not based on facts, Garofalo says, "We just cannot ignore such noises. The biodiesel segment is getting tax exemption largely because of its status as environment friendly fuel." However, Garofalo adds that similar problems are in case of soybean also where Brazil is clearing huge forest areas in favour of soybean or sugarcane acreage.

Technical limitations are the strict EU quality standards and lower iodine number. "While palm oils have a lower iodine number, these are unsustainable for the EU's winter conditions."

Other possible sources of biodiesel are soybean, animal fats, sunflower or jatropha. Limitations in case of soybean is that very little of it is produced in the EU and has to be imported. The case of sunflower also is not much different and further, the little it is grown in the EU, is expensive.

In case of jatropha, something which may fuel India's entry into the biodiesel sector, "it has the non-edible oils look and thus, the residues are a matter of concern."