Report by Biofuelwatch shows Neste, planning to make bio-jet-fuel, is using huge amounts of palm oil
A report by Biofuelwatch reveals that the Finnish biofuel and oil company Neste, which expects to become the world’s biggest producer of aviation biofuels in 2019, relies heavily on palm oil, a leading cause of rainforest destruction. It cannot even guarantee that its palm oil is not sourced from illegal plantations inside a national park. Neste is investing €1.4 billion in new biofuel capacity in its Singapore refinery, which the company plans to turn into a hub for aviation biofuel production. It is already one of the world’s biggest producers of biofuels for road transport. In 2017, Neste used almost 700,000 tonnes of crude palm oil – as fuel – as well as an undisclosed amount of crude palm oil, which the company claims to be ‘wastes and residues’, contrary to legislation in several European countries. The oil palm plantations and mills supplying Neste are mainly in Indonesian and Malaysian provinces with particularly high deforestation rates linked to palm oil. Some is proven to come from an illegal plantation in a national park in Sumatra. Neste’s sustainability standards take no account of indirect land use change (ILUC) which mean the climate impact of palm oil is x3 as bad as the fossil fuels it replaces. Neste continues to try to hide the fact it is using palm oil, and exacerbating deforestation and biodiversity loss.
9th January 2019
– A report published by the environmental NGO Biofuelwatch  reveals that the Finnish biofuel and oil company Neste, which expects to become the world’s biggest producer of aviation biofuels in 2019 , relies heavily on palm oil, a leading cause of rainforest destruction, and still cannot guarantee that its palm oil is not sourced from illegal plantations inside a national park.
Neste is investing €1.4 billion in new biofuel capacity in its Singapore refinery, which the company plans to turn into a hub for aviation biofuel production . The company, which is partly owned by the Finnish state, has entered into collaboration agreements with Air BP, Alaska Airlines, and two US airports, and it is looking for more collaborations in Europe and beyond. Neste is already one of the world’s biggest producers of biofuels for road transport. In 2017, Neste used almost 700,000 tonnes of crude palm oil as well as an undisclosed amount of crude palm oil which the company claims to be ‘wastes and residues’, contrary to legislation in several European countries.
Biofuelwatch’s report shows that the oil palm plantations and mills supplying Neste are concentrated in Indonesian and Malaysian provinces with particularly high deforestation rates linked to palm oil. Although Neste Oil claims that all of its crude palm oil is traceable to plantations which meet its sustainability standards, three separate investigations by WWF and several Indonesian NGOs between 2011 and 2017 showed Neste sourcing from a palm oil mill which was supplied from an illegal plantation inside the Tesso Nilo National Park in Sumatra . Furthermore, Neste’s sustainability standards take no account of indirect land use change which, as a report written for the European Commission shows, make palm oil three times as bad for the climate as the fossil fuels it replaces .
Report author Almuth Ernsting states: “Neste’s investment in Singapore confirms our fears that aviation biofuels will rely on palm oil and therefore worsen deforestation and climate change. Far from guaranteeing transparency and sustainability, Neste continues to keep the amount of palm oil in its fuel a secret, it continues to source from regions with rampant rainforest destruction for palm oil, and it cannot even guarantee to keep palm oil from illegal plantations in a national park out of its supply chain.”
——————— ENDS ———————
Almuth Ernsting: +44-131-623 2600 (UK), biofuelwatch[at]gmail.com
Rachel Smolker: ++1-802 482 2848 (US)
 See neste.com/releases-and-news/neste-strengthens-its-global-leading-position-renewable-products-major-investment-singapore
 See neste.com/companies/products/renewable-fuels/neste-my-renewable-jet-fuel
NESTE: THE FINNISH COMPANY PREPARING TO PUT PALM OIL IN AIRCRAFT FUEL TANKS
to read Biofuelwatch’s report about the Finish biofuel and oil company Neste and its aviation biofuel plans.
Neste aims to become the world’s largest aviation biofuel producer in 2019 and to rapidly scale up its production in the next five years. The company is well placed to do so, since it is the world’s biggest producer of biofuels from Hydrotreated Vegetable Oil (HVO), as well as being an existing supplier of aviation fuels (so far primarily fossil fuels). Hydrotreating is the only technology mature enough and within a price range that is feasible for commercial aviation biofuels. Furthermore, Neste has already signed agreements with several airlines and airports to supply HVO aviation biofuels.
Neste relies heavily on palm oil – both crude palm oil and an extract of crude palm oil called palm fatty acid distillate (PFAD). The company has decided to locate its aviation biofuel production in Singapore, i.e. in the centre of the world’s largest palm oil producing region. Neste claims that its crude palm oil is guaranteed to be ‘sustainable’ and ‘deforestation-free’. Even if this was true, the indirect greenhouse gas emissions of palm oil biofuels are still three times as bad for the climate as those of the fossil fuels they replace. Neste can meet EU sustainability standards for biofuels by sourcing palm oil from older plantations, commonly ones for which rainforest was destroyed before 2008. However, investigations show that Neste cannot even guarantee that all its crude palm oil is free from more recent or ongoing deforestation. At least one of the mills supplying Neste was found to have sourced palm oil from illegal plantations inside a national park in Sumatra during three separate investigations, most recently in 2017.
An undisclosed proportion of Neste’s feedstock – very possibly the majority – consists of PFAD which Neste cannot even trace back to plantations. PFAD is diverted from other users who in turn replace their supply mainly with crude palm oil. This means that the impacts on forests and the climate are very similar whether PFAD or crude palm oil is used. Moreover, further increases in PFAD demand could easily make it more expensive than crude palm oil and thus cause it to directly (rather than indirectly as at present), drive the expansion of oil palm plantations. Neste’s description of PFAD as a ‘residue’ is misleading. PFAD is in fact treated as a food-based biofuel under biofuel legislation in several European countries.
Neste, the world’s leading HVO producer, is lobbying for support for large-scale aviation biofuels[xvii]. Neste uses an undisclosed fraction of crude palm oil, called PFAD, (palm oil fatty distillate) in its HVO biofuels[xviii], which it controversially classes as a ‘residue’. PFAD accounts for around 5% of all crude palm oil, but its share could be increased if demand and prices go up[xix].
Letter to ICAO, from hundreds of organisations, calling on it to oppose the promotion of biofuels in aviation
ICAO supports the aviation industry’s quest for unending rapid growth, a quest which is incompatible with keeping global warming to 1.5oC or even 2oC per (a goal endorsed by the Paris Agreement). Greenhouse gas emissions from international aviation alone grew by 87% between 1990 and 2014 and are rising faster than those from almost any other sector. Efficiency improvements lag far behind growth in the number of air passengers worldwide and there are no available techno-fixes which would allow planes to fly without burning hydrocarbon fuels. ICAO hopes for vast-scale use of biofuels in aircraft: it wants to see 128 million tonnes of biofuels a year being burned in plane engines by 2040, going up to 285 million tonnes (half of all aviation fuel) by 2050. By comparison, some 82 million tonnes of biofuels a year are currently used in transport worldwide. The only aviation biofuels which can currently be produced reliably and at scale – although they are still expensive – are made from vegetable oils and animal fats, using a technology called hydrotreatment. Any large-scale use of aviation biofuels made from hydrotreated vegetable oils (HVO) would almost certainly rely on palm oil. That would be an environmental disaster.
See details of the letter to ICAO from Biofuelwatch signed by hundreds of organisations