Norway Sees Sharp Drop in Palm Oil Biofuel Consumption after Ban on Government Purchasing

by Lauren Crothers (South Africa Today) -Norway saw drop in palm oil consumption following new regulations limiting sales in response to concerns about deforestation for plantations. -The decrease has been lauded by a Norwegian rainforest advocacy group, which called it a “big win for rainforests.” -Indonesia and Malaysia, the world’s two biggest palm oil producers, have warned of retaliation if a Europe-wide phase-out of the commodity from biofuels by 2030 goes ahead.

The consumption of palm oil-based biofuels fell 70 percent in Norway last year, following a government policy change on the purchase of the commodity that is being blamed for rampant deforestation in Indonesia and Malaysia.

In 2017, the Norwegian government issued the new policy in response to mounting concern that palm oil production is having a disastrous impact on forests in the countries in which it is produced.

By last month, it appeared to have had a significant impact, when the Norwegian Environment Agency (NEA) announced a 25 percent decline in the trade of biofuels from about 657 million liters (174 million gallons) in 2017, to 497 million liters (131 million gallons) traded in 2018.

The Norwegian legislation was followed earlier this year by EU proposals to completely phase out the use of palm oil biofuel by 2030. That move drew the ire of the Indonesian and Malaysian governments, which said small, independent farmers would be the most hurt, and vowed to introduce retaliatory measures on European exports to their countries.

The EU phase-out plan does, however, make exceptions for palm oil produced on already unused land, and for smallholder farmers — but only those with fewer than 2 hectares (5 acres) of plantation land. Malaysia responded by insisting that farmers operating on 5 hectares (12 acres) should also be considered small-scale.

But Ranum from the RFN (Nils Hermann Ranum, head of Rainforest Foundation Norway’s (RFN) drivers of deforestation program) insisted that the portrayal of the policy changes are being incorrectly perceived “as a ‘ban’ on palm oil,” when in fact they represent “a removal of incentives to use biofuels based on feedstocks with a high risk of indirect land-use change (deforestation) to comply with renewable energy mandates, on the basis that they fail to deliver reductions in greenhouse gas emissions.” READ MORE