Individual Essay

Individual Essay: Policy versus Practice
Palm Oil and Palm Kernel Shell: Can it be Sustainable Energy Source?

Misaki Takahashi
Due to its high productivity and cost effectiveness, oil palm is widely utilized in food, pharmaceuticals, and biofuel. The demand of oil palm is predicted to reach 240 Mt in 2050, nearly twice today’s total (Corley, 2009). Oil palm can be categorized as renewable energy resources in most countries, but it is also criticized as a major driver of deforestation, peat degradation, biodiversity loss, chemical pollution, and social issues (Sheil et al., 2009). On the other hand, Japan which is one of the major importers of oil palm has approximately 80 times increase of imports about oil palm by-products (PKS: Palm Kernel Shell) mainly for energy use after Feed in Tariff (FIT) was implemented in 2012. One of the purposes of FIT is to reduce the burden on the environment arising from energy supply by promoting renewable energy; nevertheless, nearly 90 % of biomass energy power plants plan to use palm oil and PKS as a fuel instead of domestic biomass which less burden on the environment. There is big a deficiency in the regulation in international consumers of oil palm and the problematic situation in the producers is not properly reflected on the policy in a country of consumer.
Expansion of Oil palm production
There is about 9.1 million hectares of oil palm plantation in the world, and among them, 4.6 million ha is in Indonesia and 3.8 million hectares in Malaysia (CIFOR 2009). The current rapid expansion of oil palm plantations is largely driven by growing demand for oil for food, industrial processes, and fuel in the world (Sheil et al., 2009). Since the early 1980s, the total area of land allocated to mature oil palm has more than tripled globally, reaching nearly 14 million hectares in 2007. Most of this expansion has occurred in Indonesia, where the total land area of oil palm plantations increased by over 2100% (more than 22 times greater) over the same period, growing to 4.6 million hectares (FAOSTAT 2008). As for the import of oil palm, New Zealand (30%) is the biggest importing country, followed by the Netherlands (17%), Korea (10%), Poland (8%), China (7%), England (6%), and Japan ; Germany (4%) (Mitsubishi UFJ Research and Consulting, 2018). As a consequent of the increased global demand, it is expected that the conversion of logged-over tropical forests for palm oil production will likely continue over the next decade (Butler et al., 2009).
Producer side: Devastating effect of oil palm plantation
In Indonesia, nearly 25% of all oil palm plantations are on peatlands which categorized as High Conservation Value Forest (HCVF) (Varkkey, 2011). The major way to clear forest is burning and it often brought the crisis of forest fire. In fact, HCVF area is highly inflammable due to its high carbon density. and especially the forest fire of deep peat which is often extends underground makes it harder to put out (Varkkey, 2011). Moreover, the conversion causes the transboundary haze problem among Southeast Asia. Since 1997, more than 60,000 peatland fires occurred and caused the haze problem in the region (Tan et al., 2009).

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The conversion has also been threatening wildlife. It can be seen that the spices in oil palm plantation is significantly lower than the other form of forests (Figure 1). Furthermore, elephant (Elephas maximus sumatrensis) and Sumatran tiger, are especially threatened by oil palm expansion and are often captured or killed when vegetation is cleared to make way for new plantations. Elephants are considered to pose a risk to the oil palm plantations because they often destroy plantations and feed on the oil-rich palm nuts (Susanto and Ardiansyah 2003). Total number of species of forest birds and forest butterflies recorded from different land use types in southern Peninsular Malaysia and Borneo, respectively

Figure 1. Comparison of species richness in oil palm plantations vs. (a) primary forests and (b) degraded natural forest. Species richness has been scaled such that forest richness is equal to 1. (Source: Fitzherbert et al., 2008)

Chemical pollution
Harvested oil palm must be processed within 24 hours because of its fast deterioration so the oil palm mill is usually operated next to the plantation. At present, the large mills processing at least 30 tons of fruit per hour are more profitable and require less energy per unit of oil produced than the current generation of small mills; therefore, it is claimed that about 3,000 to 5,000 hectares of the plantation is required to keep high utilization rate (Sheil et al., 2009; Nakamura, 2016).

In addition, the drainage from an oil palm mill is called POME (Palm Oil Mill Effluent) has deteriorate effects on local environment because of its high concentration of suspended solid (SS), oil and grease (O;G), chemical oxygen demand (COD) and biological oxygen demand (BOD) (Sia et al., 2017). In addition, drainage are often discharged at extremely high temperature, between 80 to 90°C, with fairly acid such as pH4.0–5.0 (). The current ponding system applied for POME treatment often struggle to comply with the POME discharge limit (Kaman, et al., 2017). Actually, the COD of POME (average 80,000mg/L) is extremely polluted when compare it with effluent standards in Japan (160mg/L) (RSPO, 2009; Water Pollution Prevention Act of 1970). Its hot drainage ///////// often discharged hot, i.e., at a temperature of between 80° and 90°C and a fairly acidic (Jawad et al. 2018).

High carbon emission
Consumer of oil palm
Oil Palm for biomass power generation: Japan’s case
With regard to the importers of oil palm, Japan is the world’s 7th largest consumer of the products. Japan’s import of oil palm by-products (PKS; Palm Kernel Shell) has been significantly increasing since FIT implemented in 2012 (Figure 1). The purpose of the Act is:
‘to promote the use of sources of renewable energy as energy source for electricity by taking special measures in respect of price, time frame, etc. with regard to the procurement of electricity from sources of renewable energy by electricity utilities, taking into consideration that the use of sources of renewable energy as energy sources is important in securing a stable and appropriate supply of energy appropriate for the economic and social environment in Japan and abroad and in reducing the burden on the environment arising from energy supply, thereby contributing to the strengthening of the international competitiveness of Japan and the sound development of the national economy, including the promotion of Japanese industry and the revitalization of local communities(Act No. 108 of August 30, 2011).”
As of December 2017, total 277 biomass power generations have been certified under FIT and the total power output is 1.15 million kW. However, due to the high cost (financial cutting 7,699 yen/?3; thinned wood 10,659 yen/?3) and the unstable supply of national biomass energy resources such as wood biomass and untapped woody biomass, certified FIT biomass energy powerplants have no choice but to rely heavily on the imported biomass energy source (Mitsubishi UFJ Research and Consulting, 2018). According to the Procurement Price Calculation Committee, the energy source of certified FIT facilities is composed of palm oil (52%) and PKS (34%) as of 2017 (Figure XX). In other words, under the current regulations on FIT allows Power Producer and Supplier (PPS) to be able to use the oil palm biofuel which has high environmental burden to power generation instead of national woody biomass; moreover, PPS can mix coal with biomass (co-firing) to enhance its combustion efficiency; cofiring ratio of biomass has not been sanctioned;1???? thus. (??FIT???).

Figure 1. Japan’s imports of PKS by country
(Source: based on data from Trade Statistics of Japan)

Figure 2. Japan’s imports of PKS by country as of March 2017
(Source: based on data from Trade Statistics of Japan)
Sustainable standard of biomass energy in EU and the U.S.On the other hand, European countries and the U.S. which have implemented FIT earlier than Japan have been gradually improving their sustainable criteria on biomass energy from the viewpoint of sustainability.

In 2015, In May 2017, a Member of the European Parliament (MEPs) called on the commission to address the phaseout the energy use of palm oil which has devastating impacts on deforestation, preferably by 2020. In addition, MEPs stressed the termination of EU subsidies for biofuels produced from food crops and for a phase out of such fuels that should not be eligible for meeting all EU 2030 climate and energy targets, in particular biodiesel, which has created an unsustainable demand for palm oil (
Furthermore, the U.S. has not sanctioned the use of palm oil as a biofuel. The National Renewable Fuel Standard program (RFS2), the revised version of RFS1 published in 2007, established in 2010 and it specified that the life cycle assessment of GHG emissions of renewable energy source must be lower than the 2005 baseline. However, palm-based biodiesel (17% reducing of GHG emissions) fails to meet the requirement of 50% GHG emissions reducing for biodiesel; therefore, it does not qualify as renewable biofuel under RFS2 (Radzian, XXXX).
Compared to other major oil crops such as soybean, rapeseed, cottonseed, and sunflower, palm oil has lower production costs and produces more oil from less land (Yusoff and Hansen 2007). The cultivation of palm oil can deliver positive contributions to the economic development of countries ( On the other hand, there is a strong correlation between the opening of plantation land and fires; furthermore, the conversion of oil palm has been threatening wildlife and it sometimes produces transboundary haze problem in the Southeast Asian region (FIREXXX). European countries and the U.S. have been taking measure on gradual phaseout/ban of palm-based biofuel; however, there is still a lot of chinks in a law in the countries which has been consuming oil palm. In the result, Japanese government has been using the large amount of tax on FIT to encourage PPS to utilize palm oil and PKS instead of national wood biomass to generate renewable energy. This serious gap between the policy in consumers and the practice in producers has created an unsustainable expansion of oil palm.

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