Indonesia’s biofuel bid threatens more deforestation for oil palm plantations

An Indonesian government program to phase out diesel for an alternative made from palm oil could spur massive deforestation for palm plantations spanning an area a fifth the size of Borneo.

The biodiesel transition program, the world’s most ambitious, will require 15 million hectares (37 million acres) of new oil palm plantations, according to Arifin Tasrif, the minister for energy and mines. Speaking at a parliamentary hearing last month, he said that was how much new palm oil production would be needed to replace current oil consumption of a million barrels a day.

A newly published study puts the figure of new plantations to supply the program at 9.3 million hectares (23 million acres). Although this is a lower projection than the ministry’s, it still represents an area two-thirds the size of Indonesia’s Java Island.

The program is meant to both ease Indonesia’s dependence on crude oil imports and make the shift to so-called biofuel, which the government touts as a cleaner alternative to conventional fossil-fuel diesel. The government is rolling out the program in stages, blending progressively higher concentrations of palm oil-derived biodiesel into conventional diesel. The program is currently at the B30 stage, which means the diesel sold at the pump contains a 30% blend of palm oil-derived biodiesel. It’s expected to reach the B50 stage, a 50:50 blend, by 2025.

But to do that, the total planted area of oil palms will have to be at least 22.7 million hectares (56 million acres), according to the new study by the University of Indonesia’s Institute for Economic and Social Research (LPEM UI).

“That’s only to meet the need [for palm oil-derived biofuel] until 2025,” said Alin Halimatussadiah, the LPEM UI head. “That’s why there needs to be serious mitigation to hold back land expansion.”

If the government were to maintain the program at B30 through 2025, or even lower the blend to B20, the need for new oil palm plantations wouldn’t be as great — 338,880 to 5.25 million hectares (837,400 to 13 million acres) — but would still entail a significant amount of deforestation.

Another study, by Traction Asia, warns that the low productivity of existing plantations and ambitious target of the biodiesel program could see demand outstrip supply by 2023. Traction Asia researchers attribute this gap to the government’s failure to account for the inefficiency of oil palm plantations when setting its biodiesel targets. They note that, despite Indonesia being the world’s biggest producer of palm oil, its plantations have lower yields than those in Malaysia, the No. 2 producer.

“Unfortunately, the government only focuses on setting the target with no clear road map,” said Traction Asia research manager Ricky Amukti. “This will create a deficit. This biodiesel program was initially created to absorb excess crude palm oil production, but unfortunately it has become a boomerang as the [biodiesel blend] target kept being increased. What was initially an oversupply will become a deficit.”

Mongabay

Tags: Indonesia’s biofuel, oil palm plantations