Insiders say international initiative to set environmental standards for palm oil production is 'on brink of collapse'
An international effort to ensure that biofuel used by Britain and other western countries to tackle global warming does not damage the environment is on the brink of collapse.
The move could have significant implications for the UK government, which is relying on the project to defuse criticism that Britain's biofuel policies will help destroy rainforest and worsen climate change.
Ministers last year introduced a demand on fuel suppliers to replace 2.5% of petrol and diesel sold with biofuel, at least 8% of which is currently palm oil, though the volume used is expected to increase as biofuel use expands. Palm oil is one of the cheapest biofuels and several UK power stations that could burn it to generate electricity are in the pipeline.
The RSPO was established to set and enforce environmental standards for palm oil production, but has run into trouble after palm plantation companies in Indonesia and Malaysia blocked efforts to curb their greenhouse gas emissions.
"If this issue is not resolved and greenhouse gas emissions are not included in the standard, then I don't see how the RSPO can continue to act as a certifying body," said Marcus Silvius of environment group Wetlands International, who sits on the RSPO's working group on greenhouse gases. "It's a crucial moment. If we don't get agreement on this, then I think a large number of stakeholders will consider withdrawing." The issue will be discussed again at an RSPO meeting this weekend, and needs the support of the companies to be approved.
Tim Killeen, who represents Conservation International on the roundtable, said: "Failure to reach a compromise would be a serious blow to the credibility of the RSPO. I find it hard to believe that in 2010 people will accept a definition of sustainability that does not explicitly address the need to reduce greenhouse gas emissions."
RSPO representatives from the Indonesia and Malaysia palm oil firms would not comment. A position paper from Malaysia's Sarawak Oil Palm Plantation Owners Association (pdf) attacks RSPO plans to ban new plantations on peatland, which produce significantly higher greenhouse gas emissions. It says: "Peatlands worldwide, including those from temperate countries, are being utilised for commercial purposes, so why can't we allocate part of our precious resources for oil palm to generate revenue for local people?"
The Indonesian Oil Palm Research Institute said: "Unfortunately the work of the [RSPO working group on greenhouse gases] has solely covered environmental issues and totally missed out economic and social aspects. In addition, we found many gaps in current research findings which create uncertainties."
Under plans to be discussed at UN climate talks in Copenhagen in December, tropical nations such as Malaysia and Indonesia could be compensated if they leave such forests standing, rather than replacing them with planted oil palm. But this so-called Redd scheme is yet to be finalised, and there is no guarantee that the Copenhagen talks will set up the financial mechanisms required.
Johan Verburg, who represents Oxfam in the RSPO, said global brands, retailers and banks have not yet given a clear signal on if or how they will value efforts by palm oil producers to address carbon emissions.
"Realistically, it was an illusion to think that producers would voluntarily commit to short-term measures in the absence of global compensation mechanisms," he said. "Although results as yet are disappointing, I believe it is too early to speak about a failure. However, the current situation shows it is even more urgent for palm oil sourcing companies in the UK and elsewhere to express their need for sustainable palm oil."