The Oil Palm

The Brussels Biofuels Debate, Part II: The French Attack Palm Oil Again

The French attack against palm oil continues, but this time out of Brussels. Corinne Lepage, a French Liberal MEP and the Rapporteur for the Revision of the Renewable Energy Directive (RED), has called for the introduction of a full ILUC factor for biodiesel use in the EU, in a report submitted to the European Parliament. MEP Lepage paid no attention to the mounting body of evidence highlighting the inherent uncertainty of Indirect Land Use Change (ILUC) analyses and its unsuitability for policy making. Instead, she has backed the full-fledged introduction of discriminatory ILUC factors on biofuels. If MEP Lepage’s report is adopted, arbitrary ILUC factors outlined in the Commission’s proposal will count towards the targets set on GHG emissions reductions in the RED. These ILUC factors will act as discriminatory market barriers for the export of palm oil biodiesel to Europe.

MEP Lepage is aiming to effectively end the exports of palm-based biofuels to the EU, with this report. The ILUC factors proposed by the European Commission discriminate against foreign sourced feedstock, and palm oil in particular.While actively discriminating against palm oil and oil palm co-products, MEP Lepage has taken great care to protect domestic industries by introducing aclause that delays until 2020 the introduction of ILUC factors for those domestic biofuels – because those fuels are deemed to already meet the EU’s pre-existing GHG reduction targets.

MEP Lepage’s proposal also represents an affront to national sovereignty and agricultural expansion in developing countries as it introduces new ‘sustainability standards’ that would preclude the production of biofuels from land that had previously been forested. This is an extra-territorial application of EU law that must be resisted by developing nations. The fundamental right of emerging countries to determine their own land-use policies cannot be contested and MEP Lepage’s proposal undermines national sovereignty. Developing countries have a right to increase prosperity and use their natural endowments, and this should not be undermined by grandstanding from European politicians. With her proposal, MEP Lepage risks dragging the EU into further trade disputes with its trading partners.

Similarly, her proposal to give the European Commission the power to arbitrarily change future calculations or criteria for biofuel use, leaves the door open for future protectionist policies that could pile more discrimination against palm oil.

MEP Lepage’s report is based on faulty science, is coated with discrimination against non-EU countries like Malaysia, and would have negative economic, social, and environmental consequences. The draft report is alarming for the palm oil industry, not only as they relate to their implications on palm-based biofuels, but also in terms of their broader implications for other palm-based products. There is a real risk that any precedent that is set during the revision of RED will be followed in future legislative proposals; ranging from laws on consumer protection to sustainability and carbon footprints requirements for food products.