The eco-bonafides of palm oil have been long debated, especially in Europe, and it looks like that cat fight may now move to the U.S. The general charge against palm oil is that plantations devastate rainforests and other native habitats that suck up CO2. That problem seems particularly relevant when palm oil is used to make biofuel; land use changes may undermine any benefit in reducing use of fossil fuels.
EPA has put out a notice that palm oil biofuels (diesel) do not meet the agency’s standard for climate-change gas reduction in the Renewable Fuel Standard. At a minimum, a renewable fuel has to provide a 20% emissions savings, and biofuels from palm oil rate only as high as 17%.
EPA points out that 90% of palm oil comes from Malaysia and Indonesia, and that’s where it focused its analysis. In a note, EPA gives two examples of ways that palm oil production fails. “For example, palm oil production produces wastewater effluent that eventually decomposes, creating methane, a GHG with a high global warming potential. Another key factor is the expected expansion of palm plantations onto land with carbon-rich peat soils which would lead to significant releases of GHGs to the atmosphere.”
EPA has opened a comment period on this ruling, and palm oil producers in Malaysia and Indonesia are very likely to file protests. As reported in the Business Times of Malaysia, that country is already threatening a trade war. The article also says that the EU has similar restrictions.
Palm oil growers who would claim the EPA is biased in favor of trade protectionism would enjoy some company with Chinese solar panel producers who are fighting back against dumping charges from some U.S. solar manufacturers.
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