The Oil Palm

The Oil Palm: EU Admits Palm Oil Policies Not Based on Facts but Emotion

Those following the Palm Oil debate in Europe know that the EU’s Renewable Energy Directive (RED) has been, for years, a tool for protectionist European oilseeds to attempt to restrict market access for Palm Oil. Previous versions of the RED have included obvious and at times incredible attempts to discriminate against Palm Oil: all have been dismissed as anti-scientific, unworkable and in contradiction with the facts.

That the RED is anti-scientific is widely known but now this has been confirmed from the most unlikely of sources – the EU Commission itself.

The EU Commission’s Director of Renewable Energy, Marie Donnelly, was recently quoted as saying that EU policy on renewable energy should be determined by citizens’ emotions, “even if these concerns are emotive rather than factual-based or scientific”.

It is important to take a moment to consider the implications of this statement. The EU has accepted that its flagship emissions-reduction, renewable energy policy is not based on facts or science. This is a damning indictment of the weakness and the discrimination of the EU’s policymaking.

The admission – which is confirming what was known to be true in any case – is all the more concerning because in some important ways the RED Directive has worked well. An important area of achievement has been in the transport and energy generation sectors, where imported Palm Oil biodiesel has been used as a renewable energy source to great effect.

The use of Palm Oil biodiesel in Europe has risen, for several reasons. First, Palm Oil is incredibly cost-effective. It has a superior yield compared to its competitor oilseeds, such as rapeseed. Rapeseed produces around 0.79 tonnes of oil per hectare; Palm Oil produces 4 tonnes per hectare. The incredible efficiency and productivity of Palm Oil leads to cost benefits for businesses and consumers in Europe – not to mention environmental benefits, as far less land needs to be used to produce oil.

Second, Malaysian Palm Oil biodiesel meets strict sustainability standards both at home and abroad. Malaysia has a world-leading Palm Oil sector, with strict Government and industry regulation. The recent introduction of the Malaysian Sustainable Palm Oil (MSPO) standard, aimed to cover all Malaysian Palm Oil, is the guarantee of quality and sustainability.

In order to qualify for biofuel imports under the Renewable Energy Directive, Malaysian Palm Oil must meet further sustainability criteria, in the form of certification schemes that are recognized by the EU Commission. Malaysian producers have no problems in meeting these demanding and strict criteria, such as the German Government’s ISCC certification.

The proof that Malaysian Palm Oil is both beneficial, and sustainable, is incontrovertible. Why, then, would EU leaders try so hard to fix the RED process against Palm Oil? A simple answer: protectionism. Ms Donnelly was correct in admitting that the RED is not based on science – however, her assertion that it is ‘emotive’ factors that are driving EU policy is misleading. What is driving EU policy is the fact that Palm Oil is taking market share from less efficient, less competitive crops such as European-grown rapeseed.

Protecting uncompetitive domestic rapeseed is why the EU previously attempted to introduce Indirect Land-Use Change (ILUC) criteria that would have harmed Palm Oil. It is also why some MEPs tried to remove Palm Oil from ‘approved’ biomass lists, without evidence (other crops’ position on the list was never questioned). Finally, it is the reason that new anti-scientific campaigns against Palm Oil have already kicked off ahead of the latest EU revision of the RED in 2017.

The campaign is about discrimination, pure and simple. A WTO case is already underway on an unrelated issue of EU discrimination against Palm Oil imports; the EU Commission sounds like it is inviting further such cases if it intends to ignore facts and science in favour of discrimination against imports in RED.

The admission from the Commission that protectionism and anti-science views will be promoted and accepted as part of EU policy is a warning. The next 12 months of biofuel negotiations will be difficult – and the market share of Malaysian Palm Oil is clearly under threat. Claims from the EU that this is based on ‘emotion’ or ‘public opinion’ should be ignored: this is discrimination for protectionist reasons, and should be treated as such.