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    Spanish company Ferry Group is to invest €42/US$55.2 million in a project for the production of biomass fuel pellets in Bulgaria. The 3-year project consists of establishing plantations of paulownia trees near the city of Tran. Paulownia is a fast-growing tree used for the commercial production of fuel pellets. Dnevnik - Feb. 20, 2007.

    Hungary's BHD Hõerõmû Zrt. is to build a 35 billion Forint (€138/US$182 million) commercial biomass-fired power plant with a maximum output of 49.9 MW in Szerencs (northeast Hungary). Portfolio.hu - Feb. 20, 2007.

    Tonight at 9pm, BBC Two will be showing a program on geo-engineering techniques to 'save' the planet from global warming. Five of the world's top scientists propose five radical scientific inventions which could stop climate change dead in its tracks. The ideas include: a giant sunshade in space to filter out the sun's rays and help cool us down; forests of artificial trees that would breath in carbon dioxide and stop the green house effect and a fleet futuristic yachts that will shoot salt water into the clouds thickening them and cooling the planet. BBC News - Feb. 19, 2007.

    Archer Daniels Midland, the largest U.S. ethanol producer, is planning to open a biodiesel plant in Indonesia with Wilmar International Ltd. this year and a wholly owned biodiesel plant in Brazil before July, the Wall Street Journal reported on Thursday. The Brazil plant is expected to be the nation's largest, the paper said. Worldwide, the company projects a fourfold rise in biodiesel production over the next five years. ADM was not immediately available to comment. Reuters - Feb. 16, 2007.

    Finnish engineering firm Pöyry Oyj has been awarded contracts by San Carlos Bioenergy Inc. to provide services for the first bioethanol plant in the Philippines. The aggregate contract value is EUR 10 million. The plant is to be build in the Province of San Carlos on the north-eastern tip of Negros Island. The plant is expected to deliver 120,000 liters/day of bioethanol and 4 MW of excess power to the grid. Kauppalehti Online - Feb. 15, 2007.

    In order to reduce fuel costs, a Mukono-based flower farm which exports to Europe, is building its own biodiesel plant, based on using Jatropha curcas seeds. It estimates the fuel will cut production costs by up to 20%. New Vision (Kampala, Uganda) - Feb. 12, 2007.

    The Tokyo Metropolitan Government has decided to use 10% biodiesel in its fleet of public buses. The world's largest city is served by the Toei Bus System, which is used by some 570,000 people daily. Digital World Tokyo - Feb. 12, 2007.

    Fearing lack of electricity supply in South Africa and a price tag on CO2, WSP Group SA is investing in a biomass power plant that will replace coal in the Letaba Citrus juicing plant which is located in Tzaneen. Mining Weekly - Feb. 8, 2007.

    In what it calls an important addition to its global R&D capabilities, Archer Daniels Midland (ADM) is to build a new bioenergy research center in Hamburg, Germany. World Grain - Feb. 5, 2007.

    EthaBlog's Henrique Oliveira interviews leading Brazilian biofuels consultant Marcelo Coelho who offers insights into the (foreign) investment dynamics in the sector, the history of Brazilian ethanol and the relationship between oil price trends and biofuels. EthaBlog - Feb. 2, 2007.

    The government of Taiwan has announced its renewable energy target: 12% of all energy should come from renewables by 2020. The plan is expected to revitalise Taiwan's agricultural sector and to boost its nascent biomass industry. China Post - Feb. 2, 2007.

    Production at Cantarell, the world's second biggest oil field, declined by 500,000 barrels or 25% last year. This virtual collapse is unfolding much faster than projections from Mexico's state-run oil giant Petroleos Mexicanos. Wall Street Journal - Jan. 30, 2007.

    Dubai-based and AIM listed Teejori Ltd. has entered into an agreement to invest €6 million to acquire a 16.7% interest in Bekon, which developed two proprietary technologies enabling dry-fermentation of biomass. Both technologies allow it to design, establish and operate biogas plants in a highly efficient way. Dry-Fermentation offers significant advantages to the existing widely used wet fermentation process of converting biomass to biogas. Ame Info - Jan. 22, 2007.

    Hindustan Petroleum Corporation Limited is to build a biofuel production plant in the tribal belt of Banswara, Rajasthan, India. The petroleum company has acquired 20,000 hectares of low value land in the district, which it plans to commit to growing jatropha and other biofuel crops. The company's chairman said HPCL was also looking for similar wasteland in the state of Chhattisgarh. Zee News - Jan. 15, 2007.

    The Zimbabwean national police begins planting jatropha for a pilot project that must result in a daily production of 1000 liters of biodiesel. The Herald (Harare), Via AllAfrica - Jan. 12, 2007.

    In order to meet its Kyoto obligations and to cut dependence on oil, Japan has started importing biofuels from Brazil and elsewhere. And even though the country has limited local bioenergy potential, its Agriculture Ministry will begin a search for natural resources, including farm products and their residues, that can be used to make biofuels in Japan. To this end, studies will be conducted at 900 locations nationwide over a three-year period. The Japan Times - Jan. 12, 2007.

    Chrysler's chief economist Van Jolissaint has launched an arrogant attack on "quasi-hysterical Europeans" and their attitudes to global warming, calling the Stern Review 'dubious'. The remarks illustrate the yawning gap between opinions on climate change among Europeans and Americans, but they also strengthen the view that announcements by US car makers and legislators about the development of green vehicles are nothing more than window dressing. Today, the EU announced its comprehensive energy policy for the 21st century, with climate change at the center of it. BBC News - Jan. 10, 2007.

    The new Canadian government is investing $840,000 into BioMatera Inc. a biotech company that develops industrial biopolymers (such as PHA) that have wide-scale applications in the plastics, farmaceutical and cosmetics industries. Plant-based biopolymers such as PHA are biodegradable and renewable. Government of Canada - Jan. 9, 2007.

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Tuesday, August 29, 2006

Chavez in Malaysia: palm oil, biofuels, geopolitics and ideology

Even though OPEC-member Venezuela is an oil rich country, it is seeking investments from Malaysia's palm oil sector as part of efforts to diversify its economy and to prevent it from becoming too dependent on fossil fuel. Venezuelan President Hugo Chavez is on a four-day visit to the country to boost economic ties. Top of the agenda was his visit to the state-owned Golden Hope plantations where he expressed great interest in palm oil's competitiveness as a renewable energy crop, and where he closed a bilateral biofuel cooperation deal. During his visit he also controversially urged Malaysia to 'bypass the West'. And reciprocally, Malaysia announced it is backing Venezuela's bid for a seat on the UN Security Council. Clearly, biofuels, geopolitics and ideology are forming a fascinating cocktail.

Chavez's first stop was at Golden Jomalina Food Industries Sdn Bhd, Golden Hope's biodesel plant in Teluk Panglima Garang. While heading to the Golden Hope Academy in Pulau Carey later, Chavez and his delegation had the chance to view the palm plantations. Chavez asked many questions about costs, yields, social sustainability, technology and biodiesel. Venezuela, one of the world's largest oil producers, shares the Equator line with Malaysia, making its land also suitable for growing oil palm.

Briefing the president, Golden Hope's group chief executive Datuk Sabri Ahmad revealed some interesting facts about what such a tech and knowledge transfer would entail:
  • High yielding clones: Golden Hope could bring in its in-house developed ultra-high yielding GH 500 series planting material to Venezuela. The planting material is capable of yielding 40 tonnes fresh fruit bunch per tonne with a 25 percent extraction rate, which comes down to a yield of around 10 tons of oil per hectare. It is sold at RM1.35 per seed locally and RM1.80 for overseas markets. About 30 percent of Golden Hope's total plantation had been planted with the GH 500 series.
  • Smallholder involvement: a presence in Venezuela would consist of establishing "nucleas estates" where the promotion of palm oil would be done via smallholders. "Land is sensitive issue anywhere in the world. We should work with the government how to promote palm oil through their own smallholders," he added.
  • Good management: Sabri told Chavez during a briefing that good management is crucial, and illustrated this by saying that Malaysia will double its palm oil production either by 2010 or 2015. This could be achieved via good planting materials, harvest culture and biotechnology applications which Malaysia was currently pursuing, he said. Sabri also told the president that six million tonnes of the total production would be set aside for biodiesel production and the remainder for food-related purposes.
  • The cost to run a 10,000-hectare palm oil plantation, yielding 400,000 tons of fruit bunches and 100,000 tons of oil, would require an investment of about US$40 million for three years.
  • Since Golden Hope's plantations are state-owned, the biofuels knowledge and tech transfers all happen within a formal bilateral framework
This alliance is quite interesting because of Chavez's (controversial) policies at home. As is well known, the left-leaning president has been implementing a grand series of socio-economic policies aimed at bringing social justice to the poor through fighting poverty, solving land issues for the rural population, bringing education and health-care to the poor, redistributing wealth, and managing Venezuela's oil wealth in such a way that it benefits all citizens.

It will be interesting to see how Venezuela's nascent biofuels industry and the alliance with Malaysia will fit into these policies. As we have said elsewhere, oil palm can be a GDP-booster and bring wealth and jobs to the rural poor, provided the right policies are put in place. We feel that if there is one country where these major benefits of palm cultivation can be achieved, it is Venezuela.

While at it, Hugo Chavez urged Malaysia to bypass Western powers as it expands its global business links, and presented Caracas as an ideal destination to develop its palm oil and petroleum technology. Some interesting quotes:
  • "The solution for our countries is not the North. The solution is between us ... We have to have our own model, not the model the countries of the North want to impose upon us,'' said Chavez, while using a laser pointer on a world map to indicate where the United States and Europe was.
  • The left-leaning Chavez, a frequent critic of U.S. President George W. Bush, then implored Malaysian companies to invest in Venezuela as they were "brothers.''
  • "Palm oil is very important to us. If Malaysia doesn't have the land to plant anymore, Venezuela has it,'' Chavez added.
  • He also dangled a Venezuelan oil carrot before the gathering of about 150 businessmen and government officials. "Don't worry Malaysia. As a brother, we can help you explore and find oil. If you don't have oil (anymore) ... it will be provided for by Venezuela,'' he added. Venezuela, he said, had even larger proven reserves than Saudi Arabia - the reason America was out to oust him.
  • "Malaysia is a country that shares many of Venezuela's positions. I think a new world geopolitical dynamic heading toward post-imperialism is in march. Imperialism must end, and it will end''.
  • "My friend Fidel Castro says ... Washington is looking for you,'' added Chavez, without elaborating.
We will definitely keep tracking this development as it is another step forward towards creating an intensive form of South-South cooperation in the bioenergy sector. Meanwhile, green energy has become the battlefield of mild ideological struggles, that much is clear.

More information:
[Entry ends here]
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Money grows on trees as palm oil beats crude oil

Energetically speaking, oil palm trees yield more usable energy than any other crop. Economically speaking, they are profit machines and GDP-boosters. Socially speaking, they create wealth and jobs for smallholders in developing countries. Environmentally speaking, they are highly problematic. We must focus on all these factors, and balance them out. One factor, however stands out: according to Bloomberg, the best-performing oil investment comes from trees in Malaysia, not the deserts of Saudi Arabia. The crop is seeing 'phenomenal growth', stunning longtime commodity analysts. The reasons are obvious.

Vegetable oils from palm trees normally used in mayonnaise and chocolate bars are being converted to diesel for trucks after oil more than doubled in the past three years and governments encouraged renewable fuels. Palm oil reached a two-year high this month and rose 17 percent in the past year, outperforming the crude oil used for most diesel.

Palm oil in Kuala Lumpur may rally 20 percent in the next six months as factories making so-called biodiesel sprout from Beijing to Seattle, said Michael Coleman, who helps run a $370 million hedge fund in Singapore. At Schroders Plc in London, Christopher Wyke expects a 25 percent gain in the next year. "It's a very attractive investment", said Wyke, who helps manage $85 million of commodity investments.

In Europe, where one of every two new cars sold burns diesel, biodiesel output will double by 2008 to meet European Union targets for alternative-fuels use, the International Energy Agency in Paris forecasts. Fuel from palms, soybeans and rapeseed now supplies less than 1 percent of the world's diesel. The European Union ordered that 5.75 percent of all fuel for trucks and autos must come from renewable sources by 2010. Fuel production from vegetable oils worldwide is expected to triple by 2008, with most of the growth in Europe.

Production Surges
Supplies of diesel fuel from vegetable oils soared 80 percent in 2005, the agency said in July. That outpaced a 14 percent increase in production of ethanol, a fuel derived from corn and sugar that's used as an alternative to gasoline.
Crude oil reached a record $78.40 a barrel last month and has driven up the cost of diesel and gasoline, making biofuels more competitive. Palm oil costs $507.50 a ton in Europe, less than about $680 for a ton of crude oil-derived diesel. Governments are subsidizing biodiesel to diversify energy supply and reduce greenhouse-gas emissions. Vegetable oil-based diesel is made through a chemical process where the glycerin is separated from the fat, or vegetable oil. The process leaves behind two products - methyl esters, the chemical name for biodiesel, and glycerin, a byproduct usually sold for manufacturing in soaps and antifreeze.

Palm oil comes from bunches of plum-sized fruit on the tree, which becomes productive from about 30 months after planting. In Europe, biodiesel costs the equivalent of 72 U.S. cents to produce, according to New Energy Finance Ltd., a London-based advisory company. A liter of diesel fuel sells for 81 cents on the wholesale market.
"As long as crude oil is above $50 a barrel, there is a momentum to biofuels that is unstoppable," said Coleman, of the Cayman Islands-domiciled Merchant Commodity Fund, which has returned 42 percent in the past year. `"It doesn't matter what happens to crude." Oil has traded above $50 since May 2005.

'Critical Mass'
"The industry has got to a critical mass whereby it can weather downturns in the price of crude," said Andrew Owens, chief executive officer of Greenergy International Ltd., a biofuel supplier in London to retailers including Tesco Plc, the U.K.'s largest supermarket company. "That wasn't the case two years ago."

Palm oil isn't just for trucks and cars. A U.K. unit of RWE AG, Europe's third-largest utility, may convert a power plant to burn palm oil after it evaluates the costs and technical issues, spokesman Leon Flexman said.
Biox Group BV, a biofuel producer based in the Netherlands, will have the first of four power plants running near Vlissingen, the country's third biggest seaport, early next year. The power will be sold to a Norwegian aluminum smelter.

Malaysia, Indonesia
"Right now, palm oil is the cheapest and most efficient of vegetable oils," said Group Finance Director Edgare Kerkwijk, who moved to Singapore last year to be closer to the suppliers in Malaysia and Indonesia. "We need 100,000 tons a year. We can switch to other fuels when palm oil becomes too expensive."
Malaysia and Indonesia produce 85 percent of the world's palm oil, the most consumed vegetable oil, and the U.S., Brazil and Argentina grow 80 percent of the soybeans. In Europe, palm oil is gaining market share, though most plant fuel comes from local harvests of rapeseed, sometimes called canola.

Fuel demand is adding to already booming consumption of vegetable oil for food and chemicals. China will import 8.5 million tons of vegetable oils this year, of which 64 percent will be palm oil, Standard Chartered Bank said in a report. Food use of palm oil will rise 4.5 percent this year and industrial use 9 percent, the bank said.
Prices and trading volume have soared on the Kuala Lumpur palm oil futures market. Palm oil rose 16 percent in three months to reach 1,677 ringgit ($456) a ton on Aug. 9. The commodity closed at 1,599 ringgit a ton on Friday.

'Phenomenal' Growth
"The growth has been phenomenal in my experience, in all my 27 years of being in this market," said Kelvin Lee, a broker with Palma Commodities Sdn. Bhd. in Kuala Lumpur:
:: :: :: :: :: :: :: ::

The number of outstanding contracts on the exchange, called open interest, has doubled to 65,000 in the past four months. That's 1.6 million tons, or 10 percent of Malaysia's crop.

"We'll see open interest reaching 100,000 by the end of the year," because of the European push on biofuels, Lee said.

The shares of plantation owners in Malaysia and Indonesia have surged. PT Astra Agro Lestari, the largest plantation company in Indonesia, has jumped 79 percent this year. IOI Corp., Malaysia's biggest oil palm plantation company, has gained 33 percent.

Carlyle Likes Biodiesel

Fuel from vegetable oils is a better investment than fuel from sugar or corn, said Charlie Thomas, who helps oversee $754 million in so-called green investments at Commerzbank AG's Jupiter fund unit in London.

"Biodiesel is behind the curve, so there are substantial returns to be made in this area," Thomas said. He expects annual returns of 60 percent in biodiesel investments over the next two years, compared with 30 percent at most in ethanol.

U.S. use of vegetable oils for fuel is increasing too. Nationwide, 65 plants have a total capacity to produce 395 million gallons of diesel fuel from soybean oil and other supplies, according to the National Biodiesel Board in Jefferson City, Missouri. An additional 714 million gallons of capacity is expected to be completed in the next 18 months.

Carlyle Group, which oversees more than $40 billion of private-equity funds, and Riverstone Holdings LLC, the manager of $6.5 billion, have announced plans for a controlling stake in Green Earth Fuels LLC, which will build two plants in the U.S., each capable of producing 43 million gallons a year.

Singer Willie Nelson set up Biodiesel Venture GP with Peter Bell of Distribution Drive and three partners in December 2004. Distribution Drive is a unit of Earth Biofuels Inc., whose shares have gained nine-fold in the past year. The Standard & Poor's 500 stock index rose 6.8 percent in that time, and the S&amp;amp;P Integrated Oil & Gas Index gained 18 percent.


The growing use of palm oil as fuel may threaten virgin rainforest in Southeast Asia and quicken deforestation, raising the likelihood of legal challenges from environmentalists, say some investors.

"The biggest challenge to palm oil is sustainability," said Domenic Carratu, managing director of commodities at Rabobank Groep in London. "Biodiesel aims to be environmentally friendly, but this would not be the case if the feedstock were only grown at the expense of virgin rainforest."

Vegetable oils will meet some of the world's energy demand and may help curb growth in consumption of crude oil, say energy analysts. It won't solve a lack of refining capacity.

"There's a place for biodiesel," said John Baize, president of John C. Baize and Associates, an advisory company in Falls Church, Virginia. "But it's not the solution because we don't have the feedstock" to meet demand.

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Global bioenergy trade taking off: from the tropics to the Benelux

Belgium and the Netherlands are Europe's main logistical hubs. Combined, the seaports of Antwerp and Rotterdam form the world's largest cargo-hub, moving thousands of containers and tons of bulk goods each day, ready to be distributed all over Europe or to be (re-)exported to anywhere in the world. Not surprisingly, both countries are preparing for the bioenergy revolution and are busy building bioterminals to import and export finished biofuels, raw biomass feedstocks and byproducts. We have a look at the infrastructure being built, at the biomass quantities that are currently involved, at where the biofuels come from, and at where they end up. In-depth research by the IEA Bioenergy Task 40 study-group has indicated that global, sustainable trade in bioenergy is feasible. The Benelux countries already give us a sneak preview of what this future will look like...

Both the Dutch and Belgian government set ambitious goals for the use of biofuels in the near future. It is anticipated that due to the limited arable crop area available in the Benelux countries, they will largely depend on imports in order to fulfill these ambitions. These imports could either be finished biofuels or feedstocks to produce biofuels domestically. It is generally expected that a major part of these agricultural bulk materials will be imported through the Dutch and Belgian seaports and will partly be obtained from suppliers outside the EU.

The Rotterdam port has already built a bio-terminal with dedicated infrastructure for the import of biofuels, including bio-ethanol, palm derivatives and wood. Biopetrol Industries, a Swiss biodiesel producer and distributor, and Dutch-based Vopak, the world’s largest independent tank terminal operator specialized in the storage and handling of liquid and gaseous chemical and oil products, agreed to build Netherlands’ biggest biodiesel plant at the Rotterdam port. The plant has a production capacity of 400,000 tons of biodiesel per year and 60,000 tonnes of pharmaceutical glycerine.

In the words of Klaus Henschel, COO of Biopetrol, the Benelux and its ports offer clear competitive advantages:
First, we will be present in Europe’s largest refinery center and therefore close to our clients. Second, Rotterdam offers a large tank storage capacity. In addition, Rotterdam is the center of the European vegetable oil market. Due to the connections to the sea and the Rhine as well as the pipeline network our logistics costs will also be significantly lower than at any other location.
Leading Malaysian palm oil producers IOI Group and Golden Hope Plantations sealed two 10-year contracts with Dutch firm Biox to buy palm oil by-products to produce green electricity. Biox will build four power plants in the Netherlands, one of which will be constructed near IOI's new palm oil refinery at the Rotterdam port - Europe's biggest with a capacity of about 900,000 tonnes a year. Malaysian Kuok Oils & Grains is building a 300,000-ton palm oil refinery at the same port. Finally, in December 2005, the company Unimills, a subsidiary of the Malaysian company Golden Hope Plantations, signed a declaration of intent with the Austrian company Godiver for building a 100,000 ton multi-feedstock biodiesel plant, using imported rapeseed oil, palm oil and soybean oil. [Info on these Malaysian deals can be found here.]
Besides building a new logistical complex for the bioenergy future, the Rotterdam port also simply imported 650,000 tons of ethanol from Brazil [*.pdf] in 2005, the major part of which was destined for the Swedish and UK market.

Eemshaven in the North of The Netherlands is gradually becoming a bioterminal as well, with a first 66,000 ton capacity biodiesel plant owned and operated by a joint-venture between BioValue N.V. and Delta N.V. In the same cluster, feedstock crushers, oil presses and biomass pretreatment facilities can be found.

In Belgium, the bulk of biofuels will be produced in the dedicated Ghent Bio-Energy Valley, both a logistical hub and a bioenergy knowledge centre located in the port city of Ghent, close to the Antwerp mainport. From this location, grain intervention stocks are easily accessible as the Euro-Silo, a huge intervention silo, is located nearby. The Bioenergy Valley has already attracted several biodiesel plants: a 150,000 ton refinery owned and operated by Bioro, one with a capacity of 140,000 tons owned and operated by Oleon [*Dutch], and Cargill's 100,000 ton plant. More plants are on the drawing board.

In Rotterdam, ethanol production is absent, but Ghent Bioenergy Valley fills the void, with Alco BioFuel [*Dutch], a cooperation between the Alco Group, Euro-Silo and Aveve, which is building a 300,000 ton ethanol plant. The same company is building a €80mio biomass power plant[*Dutch] - for which solid biofuels will be imported - at the same cluster. Europe's ethanol marktleader Südzucker AG has plans to start with production of 85,000tons in 2007, in Wallonia. Feedstocks for these plants will probably be by-products such as molasses and potato waste (the use of these products as animal feed is anticipated to decline in the Benelux), and possibly wheat.

Besides Ghent, the port of Antwerp, one of the world's largest, is establishing itself rapidly as the leading forest products port of Europe, meaning it will become the main bioenergy hub for bulk woody biomass imports for the production of green electricity [*.pdf] (and later cellulosic ethanol). Furthermore, Antwerp is home to one of the world's largest petrochemical and bulk liquid logistics clusters, attracting huge interest from liquid biofuel producing countries like Brazil and Malaysia who are looking into building biodiesel and ethanol plants there.

Feedstock chains link Ghent to Antwerp via a canal and rail, and likewise Ghent to Wallonia, an inland agricultural zone where energy crops are cultivated. Both axes are in turn linked up to the Iron Rhine, a railroad connecting the Belgian bioterminals to the Ruhrgebiet, Germany's famous industrial zone.

Biomass imports: from Malaysia and Canada, West-Africa and Brazil
Due to their small arable crop area, none of the Benelux countries will be able to produce sufficient feedstock for their projected renewable energy demand. Because of this dependency on feedstock sources outside of the Benelux, the countries are already importing raw biomass, oil seeds and vegetable oil for liquid fuels and green electricity from all over the world:

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The following table gives an overview of the types (solid and liquid) of biofuels and their quantities that have and will be imported via the Benelux bioterminals. Notice the rapid projected year on year increase:

Now that a process to produce 'winterized', cold tolerant palm biodiesel [*.pdf] has been developed (with low melting and pour points suitable for the cold European climate), the production of biodiesel based on palm oil in the Benelux will increase considerably. The low melting point palmdiesel will be blended with fossil diesel in the petro-chemical refineries in Antwerp and Rotterdam and exported throughout North Western Europe, and possibly beyond. Another option is blending palm oil with soya oil to produce pure biodiesel.

Generation of green electricity
In contrast to the use of biofuels as transport fuel, their use for green electricity generation has increased considerably during the past three years. In 2005, electricity generation accounted for the utilization of about 400,000 MT of palm oil, 1,000,000 MT of palm kernels and about 2,000,000 MT of wood material in the Benelux. The production of renewable electricity from biomass has the potential to boost demand for palm oil by more than 1,000,000 tons annually. The Dutch company BIOX bv and the Belgian company Electrabel planned to build new power plants, which would use palm oil as the primary fuel. However, most of these plans have been abandoned, as the investment is judged as to risky because of potential policy changes. Domestic farmers, grain processors and crushers reportedly lobby for the use of sunflower and rapeseed oil, while Non Governmental Organizations put pressure on the Dutch government to end the subsidies on the use of palm derivatives, claiming most of
the palm products are produced by cutting rainforests. As a result, the use of palm oil is expected to decline in 2006 and Dutch production of renewable energy is expected to drop significantly.

This is in conflict with the ambitious goals of the Dutch Government for greener
electricity production. The Ministry of Economic Affairs set targets for renewable electricity of 6 percent in 2005, 9 percent in 2010, and 17 percent in 2020. In addition, the Dutch Ministry of Environment signed an agreement with electricity producers to reduce carbon dioxide emissions by 3.2 million MT between 2008 and 2012. The Dutch Government also formulated a vision to cover 30 percent of the total energy consumption by biomass energy in 2040, mainly as primary fuel for electricity production and as transportation fuels.

By Laurens Rademakers, some rights reserved - Biopact, 2006

More information:

:: Belgium's dedicated Ghent Bioenergy Valley
:: Port of Antwerp, do check out the introductory brochures on forest products, bulk liquid logistics, the 'Antwerp Chemical Cluster' and its petrochemical complex.
:: Port of Rotterdam
:: Recent event "Meet the Port of Rotterdam: Bioenergy Transportation" [*.pdf], highlighting the new business opportunities available for ports and logistics providers in the transportation of bio fuels.

:: Jakarta Post: Indonesia, Malaysia eyeing European bio-fuels market - Aug 22, 2006
:: General info on Malaysia's palm oil industry: Malaysian Palm Oil Board

:: The EU's Directorate-General for Energy and Transport is the starting point for all laws, regulations, vision and policy texts on Europe's bioenergy future. The recently presented Biomass Action Plan gives a comprehensive overview of the EU's bioenergy ambitions and targets.

As EU Members, The Netherlands and Belgium implement regulations of the European
Commission through national law. Regarding support for the production and consumption of biofuels the following regulations are important:
:: Directive 2003/30/EC [*.pdf], which set goals of 2 percent in 2005 and 5.75 percent in 2010 for the use of biofuels as transportation fuel.
:: Directive 2001/77/EC [*.pdf], which supports the use of biomass for the generation of green
:: Directive 2003/96/EG [*;pdf], which sets the conditions for regulating taxes on biofuels for electricity generation and as transportation fuel.

American readers will find more information about EC legislation and EU-wide market information on biofuels in the dedicated section on the website of the U.S. Misssion to the EU.

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