‘Alarming’ rise in palm oil products being imported into the EU to make biofuels due to loophole

Loopholes in EU regulations appear to be driving unsustainable and fraudulent palm oil trade.

EIA’s new briefing The Palm Oil Black Box – EU trade loopholes analyses EU trade patterns for palm oil and reveals a significant increase in the imports of waste and residues used to make biofuels.

Biofuels are renewable fuels used as alternatives to fossil fuels. Palm oil and its products can be turned into biodiesel, which is mixed with conventional diesel and sold at petrol stations.

Waste and residue products are incentivised by the EU Renewable Energy (RED) scheme that aims to increase the use of renewable energy in the bloc. Such products include used cooking oil, which can be palm oil previously used for cooking.

Unlike biodiesel made directly from virgin palm oil, such products can be exempt from the EU RED’s sustainability criteria and/or can be counted twice towards renewable energy targets.

Oil palm products used to make biofuels are also largely excluded from being regulated under the new EU Deforestation Regulation (EUDR). The EUDR requires certain palm oil products to be legal and to have not caused deforestation. It comes into effect at the end of this year.

This means there is a significant loophole whereby oil palm products used to make biofuels are not effectively regulated by either regulation.

EIA Senior Forests Campaigner Siobhan Pearce said: “It’s very alarming to see this trend of increasing imports of waste and residue products that can be derived from oil palm being used to make biofuels.”

Some of the products – such as the wastewater from palm oil mills known as palm oil mill effluent (POME) – reportedly exceed what could feasibly be produced.

The pressing concern is that these waste and residue products being used to make biofuels are in fact virgin palm oil that has come from unsustainable sources – which counts as fraud and is a failure of regulations.

The EU RED initiative heavily relies on the use of certification schemes to ensure compliance. Their use needs to be urgently reviewed to assess if they are fit for purpose.

Unwittingly. we could all be consuming such products. The standard diesel sold at petrol stations contains up to seven per cent biodiesel, labelled as B7.

The Palm Oil Black Box provides an overall analysis of multiple trade codes used for oil palm products. Tracking the overall trade in oil palm is complex due to its many products and uses; many of the international trade codes are not exclusively palm oil, which makes trade opaque and hides the real picture.

To counteract the concerns, EIA recommends the EU:

• assesses the products regulated by the EUDR
• publishes its consultation on the inclusion of biofuels in the EUDR
• works with other countries to identify and address possible fraud
• assesses the role of certification schemes under the EU RED initiative and whether they are sufficient to stop fraud
• stops incentivising imported waste and residues if it cannot guarantee their origins and prevent fraudulent activity.

Tags: used cooking oil, RED, EU, trade, biodiesel, palm oil, imports, Biofuels, renewable energy, EUDR, EU Deforestation Regulation