Neste Oil, an oil refining company largely owned by the Finnish government(1), is set - over the next three years - to become the world's largest consumer of palm oil. This expansion will lead to massive deforestation and contribute to global warming.
Palm oil production is the leading cause of deforestation in Southeast Asia; the clearance and burning of rainforests and peatlands for oil palm plantations releases huge amounts of carbon dioxide. As a result, Indonesia is now the third largest greenhouse gas emitter in the world.(2) This rampant deforestation is also pushing species like the orang-utan and the Sumatran tiger to the brink of extinction.
Greenpeace is urging the Finnish government to use its influence to stop Neste Oil using palm oil, and not to subsidise palm oil for fuel in the future. The most significant way to reduce transport emissions is to make cars more energy efficient and to develop a low-energy and low-carbon transport system.
Neste Oil uses palm oil as the main component of the NExBTL-diesel and markets it as an environmentally-friendly alternative to fossil fuels. This 'green' marketing contradicts the warnings that climate scientists issued last year that palm oil grown on deforested land is many times more damaging to the climate than conventional fuels.(3)
The company has publicly announced its plans to dramatically scale up its production and has recently invested in new NExBTL refineries in Finland, Singapore and the Netherlands, due online in 2009, 2010 and 2011 respectively.(4) If these plans go ahead, the company will require at least 1.5 million metric tons of palm oil a year, making it the biggest single consumer of palm oil worldwide. Based on current yields, this increase in demand would require at least 325,000 hectares of oil palm plantations, equivalent to an area significantly larger than Luxembourg.
"Palm oil biodiesel is not a solution to climate change. It actually makes the problem worse if rainforests are cut down to grow the palm oil to fuel our cars. Neste Oil's expansion plans are a major climate threat increasing the pressure for deforestation in Southeast Asia and endangering species like the orang-utan," said Greenpeace Nordic palm oil campaigner, Maija Suomela.
"If the Finnish government is serious about tackling climate change, it must stop investing in forest destruction and instead invest in renewable energy solutions, such as waste-based raw materials, and provide significant funding for rainforest protection."(5)
Neste Oil claims to source all of its palm oil from established plantations in Malaysia. When asked by Greenpeace, the company refused to provide any evidence of traceability in its entire supply chain from the plantation to the refinery. It is also failing to provide any indication of where it intends to source future palm oil supply. The Swedish gas company OKQ8 has already refused to sell Neste Oil's palm oil diesel and a recent trial planned for Stockholm's ferry traffic was cancelled in December.
Greenpeace is calling on Finland to contribute almost € 1 billion every year, by 2020, to developing countries such as Indonesia, so that they can better cope with the effects of climate change and reduce their greenhouse gas emissions by protecting forests and developing clean energy supply.
This is its share of € 110 billion that the EU and other rich countries must invest as part of the new global climate deal in Copenhagen, to be agreed at the end of the year.(6)
Other contacts: Maija Suomela, Greenpeace Nordic palm oil campaigner:
+358 40 1809 303
Juha Aromaa, Greenpeace Nordic Communications Manager:
+358 50 369 6202
Satu Pitkänen, Greenpeace Nordic press officer (photos and video):
+358 50 546 1789
Notes: (1)The Finnish government owns 50.1% of Neste Oil.
(2) World Resources Institute, The Climate Analysis Indicators Tool
(3) Fargione, J., Hill, J., Tilman, D., Polasky, S., Hawthorne, P. 2008. Land Clearing and the Biofuel Carbon Debt, Science 1235-1238.
(5) Deforestation causes a fifth of global greenhouse gas emissions, more than the entire transport sector in the world. IPCC A R 4 (2007): WGIII Ch1
(6) To see how much each EU country should contribute and how to raise the funds, see http://www.greenpeace.org/financing-eu-responsibility. The finance package should be divided as follows:
- € 30 billion a year to stop deforestation through a 'forests for climate' protection fund (see www.greenpeace.org/forestsforclimate for details on Greenpeace's proposed funding mechanism);
- € 40 billion a year to shift developing countries onto a low emissions pathway;
- € 40 billion a year to enable the most vulnerable to cope with climate change.