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Sustainably produced biofuels do not cause deforestation – Neste

The recent “Destination Deforestation” report by Rainforest Foundation Norway raises some concerns that the Finnish government policies to promote biofuels in aviation could result in deforestation. Finland-headed oil refiner and renewable fuels producer Neste Oyj says it is not using palm oil as a raw material for renewable aviation fuel but utilises a diverse portfolio of raw materials with an ever-expanding focus on waste and residue as sources of raw material for its renewable products.

Neste’s MY Renewable Jet Fuel has proven its technical capability in thousands of commercial flights. Easily adopted by airlines without the need for investments in new jet engines or segregated fuel distribution systems, it is produced from renewable and sustainable raw materials, thus significantly reducing greenhouse gas (GHG) emissions over the life-cycle.

The recently published report “Destination Deforestation” conducted by Cerulogy on behalf of Rainforest Foundation Norway raises some concerns that the Finnish government policies to promote biofuels in aviation could result in deforestation. As both a Finnish company and the world’s largest producer of renewable fuels including renewable aviation fuels Neste has issued the following response addressing the concerns in the report.

70 percent of global palm oil production goes into the food industry. When oil palm fruit is handled, normal bruising occurs causing the fat in the fruit to start degrading. This is how free fatty acids are formed. They are undesired from the food production’s perspective and need to be removed by distillation in the palm oil refining process before the oil meets the food industry’s quality standards.

Refining food grade palm oil yields approximately 3.5–5 percent of palm fatty acid distillate (PFAD) as a processing residue. The palm oil refiners are trying to prevent its creation as its value is lower than that of palm oil. Therefore, its use does not drive palm oil production or expansion of oil palm cultivation.

The situation is similar to sawdust: nobody cuts down trees to produce sawdust. Instead, trees are harvested for logs that can be processed to planks at a sawmill. Sawdust is generated as an undesired residue, which however has value and can be used for useful purposes.

Neste does not accept deforestation or any other actions leading to biodiversity loss.

Neste buys raw material, PFAD included, only from those suppliers that are committed to sustainable working practices and meeting strict sustainability criteria embedded in the regulation on biofuels. These criteria include a proactive approach to preventing deforestation and mitigating its risk.

Neste feedstock chart.

Palm Fatty Acid Distillate (PFAD) and Palm Effluent Sludge (PES) are two oil palm residue derived
raw materials used by Neste for its renewable fuel products.

The PFAD that Neste uses is traceable to the point where it is removed from the main production stream at the palm oil refinery. In 2017, Neste committed to going beyond this requirement. We set a public target to work towards mapping the food industry supply chains – from the end of which PFAD residue is sourced – to oil palm plantations by the end of 2020.

This mapping and added transparency into the supply chain significantly surpasses the current regulatory requirement for residue raw materials to be traceable to the place of origin, in PFAD’s case to the palm oil refinery.

Working towards our 2020 target has required us to map large parts of previously unmapped food industry’s palm oil supply chains with good progress.

The Finnish government is not incentivising the use of PFAD. Instead, it treats all sustainably-produced biofuels equally. It has set a lower carbon dioxide (CO2) tax for fuels produced from waste and residues based on the fact that their greenhouse gas (GHG) emissions accumulated over their life cycle are lower than those from virgin raw materials, such as vegetable oils.

PFAD is classified as residue based on the EU Renewable Energy Directive (RED).

By replacing fossil fuels in road transport and aviation with renewable alternatives we can cut GHG emissions immediately. Switching fossil diesel to waste and residue-based renewable diesel reduces CO2 emissions from road transport by 90 percent on average, while with renewable jet fuel the reduction could be as high as 80 percent.

The climate crisis is already happening. We need all the available solutions to tackle it. With renewable materials, we can reduce the consumption of fossil crude oil and thereby the emissions released into the atmosphere. Sustainably produced biofuels have a big role to play.

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