“Renewable Diesel” Sold by Oil Majors Most Likely Contains Fraudulent Palm Oil — Study

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Research exhibits main irregularities within the reported consumption of palm residues utilized in renewable diesel (HVO) being bought by oil majors

A key ingredient for the ‘renewable diesel’ bought in Europe is probably going fraudulent, a new T&E study exhibits. Practically twice as a lot palm oil mill effluent (POME), a residue of palm oil manufacturing, is being blended into European biofuels than is on the market globally. There must be stronger coverage restrictions and devoted incentives for POME biofuels ought to be eliminated to keep away from ‘waste’ biofuels merely being palm oil in disguise, says T&E.

Oil firms are providing a ‘renewable diesel’ product dubbed ‘HVO’, which on paper ship important emissions financial savings – in some circumstances as much as 95%. A key part of that is POME, a watery sludge that’s produced throughout palm oil manufacturing. POME might have accounted for 1 / 4 of all HVO biofuels consumed within the EU in 2023.

Formally, over 2 million tonnes of POME oil had been consumed in European biofuels in 2023. That is method above the 1 million tonnes that’s estimated to be out there globally, whereas T&E’s calculations present that precise assortment of POME oil is probably going a lot decrease in apply.

Standard palm oil use in biofuels peaked at round 3 million tonnes in 2019 earlier than falling 80% by the tip of 2023. That is largely as a result of EU’s resolution to phase-out palm oil biofuels from renewable targets by 2030. In the meantime, waste-based options like used cooking oil, animal fat and residues comparable to POME are taking its place, now making up 40% of EU biofuels. There’s concern that palm oil is solely coming into Europe beneath a distinct identify, warns T&E.

Cian Delaney: “It appears a lot of POME could be just palm oil in disguise. This raises serious concerns as to whether this renewable diesel or HVO is as green as oil majors say it is. We need to remove the policy incentives that enable dodgy biofuels feedstocks making their way into Europe as supposedly sustainable fuels.”

Spain, Italy, the UK and Germany had been Europe’s largest shoppers of POME in 2023. A 3rd of Spanish biofuels got here from POME, whereas Italy relied on it for almost 20%. Germany’s POME consumption quadrupled between 2021 and 2022 however stayed regular in 2023, regardless of rising imports and falling biofuel costs.

The fast improve in POME biofuels use within the EU has led to POME costs reaching almost 90% of palm oil costs by mid-2024, suggesting {that a} reclassification of POME from residue to by-product could also be wanted if its worth continues to rise, says T&E. €2bn was spent by European oil majors on POME in 2023.

In January this yr, the Indonesian authorities published data exhibiting that exports of POME in 2023 and 2024 far exceeded the Indonesian authorities’s estimate of complete capability.

First revealed on T&E.