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Biodiesel from palm oil: finding the sweet spot between ecology and economy

Oil-palm fruit ready for transport to a processor. Photo: World Agroforestry Centre/Robert Finlayson

Oil-palm fruit ready for transport to a processor. Photo: World Agroforestry Centre/Robert Finlayson

Scientists at ICRAF The World Agroforestry Centre have struck the golden mean between intensification and environmental health for oil-palm plantations. Their analysis shows that sustainable systems can significantly boost production but not as high as some analysts believed.


Not many will disagree that once land has been brought into cultivation it is best managed in such a way that it is maximally productive. The best way to achieve higher efficiency without converting adjacent land or forest into plantations is intensification, the process of optimizing the ratio of input and output per unit of land.

‘Especially in the case of oil palm in Indonesia, yield levels have been substantially below what is considered to be the potential’, said Meine van Noordwijk, ICRAF’s Chief Science Advisor.

This has led many analysts to suggest that there is a win-win situation for economy and environment: higher yields per unit of land will increase the total output while taking away the need for plantation owners to expand into adjacent forests, thus, substantially reducing carbon emissions and maintaining biodiversity.

While that is true, intensification itself brings about a score of its own environmental problems: ground and surface water pollution, agrochemicals such as pesticides that may poison the wider landscape and, ironically, additional greenhouse-gas emissions from increased use of fertilizers. Indeed, nitrogen fertilizer emits substantial amounts of CO2 in its production stage and when applied it releases an even stronger greenhouse gas, nitrogen dioxide (N2O).

Palm oil for biodiesel

Oil-palm plantation in Jambi Province, Indonesia. Photo: World Agroforestry Centre/Robert Finlayson

Oil-palm plantation in Jambi Province, Indonesia. Photo: World Agroforestry Centre/Robert Finlayson

Eager to replace fossil fuels with greener alternatives, the European Union and others have earmarked palm oil as a source of biodiesel. Under the EU’s Reducing Emissions from Deforestation policy, biodiesel must save 35% in emissions compared to fossil fuels. However, to supply large quantities of biodiesel would also mean intensifying by increasing the use of nitrogen fertilizer.

‘When fossil fuels are replaced by biodiesel, the reduction in greenhouse-gas emissions risks being offset by additional emissions from higher fertilizer use’, argued van Noordwijk.

Intensification therefore has its limits. Finding exactly where those limits lie, however, is a scientific question that needs to be solved for each crop and each region separately. Van Noordwijk and his team now believe that they have found the sweet spot for palm oil production in Indonesia.

‘Our analysis shows that there is a middle ground of optimal intensification’, said van Noordwijk. ‘Current yields are approximately 66% of what can be achieved with the highest fertilizer levels. We believe that an increase to 80% is generally compatible with standards for the carbon footprint of production but beyond that negative effects prevail’.


‘We analysed the carbon efficiency of oil-palm plantations to verify whether palm oil indeed does save 35% of carbon emissions that the EU expects of biodiesel’, said Ni’matul Khasanah, co-author of the study. ‘We found that around 200 kg of nitrogen fertilizer per hectare would allow the highest yields without negatively affecting the carbon footprint of the plantations. Currently, most plantations report using only 141 kg’.

Young oil-palm plantation adjacent to forest in Jambi Province, Indonesia. Photo: World Agroforestry Centre/Robert Finlayson

Young oil-palm plantation adjacent to forest in Jambi Province, Indonesia. Photo: World Agroforestry Centre/Robert Finlayson

Another dominant factor in the carbon efficiency of oil-palm plantations is the carbon debt. This figure is higher (that is, savings are lower) if the plantation was created by converting forests or peatland—which are massive carbon sinks—and lower if the plantation converted empty or degraded land.

‘One caveat is that the EU RED policy contains a “grandfather” clause that acquits plantations established before 2008 from any carbon debt’, explained Khasanah.

However, the data were not easy to come by and have built-in uncertainties about the results.

‘The Indonesian palm-oil companies supplied us with a large data set on the condition of anonymity’, explained Khasanah, ‘they didn’t want their competitors to know how they were doing. They also chose which data to surrender so we have no absolute certainty about the validity of our results’.

Be that as it may, the study is an important step towards better management of oil-palm plantations that can bolster their contribution to reducing greenhouse-gas emissions and meet national targets to help fight climate change.


Read the study

Van Noordwijk M, Khasanah N, Dewi S. 2016. Can intensification reduce emission intensity of biofuel through optimized fertilizer use? Theory and the case of oil palm in Indonesia. GCB Bioenergy online . DOI:10.1111/gcbb.12398.



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ICRAF The World Agroforestry Centre is one of the 15 members of the CGIAR.

We would like to thank all donors who support research for development through their contributions to the CGIAR Fund.

Sander Van de Moortel

Sander Van de Moortel

After obtaining his master's degree in linguistics and, later, journalism, Sander Van de Moortel chose to  leave his native Belgium for more adventurous lands. After a stint as a product manager for a German IT firm, he landed in China in 2011 after taking a wrong turn on a bike trip through Viet Nam. Comfortably trapped in Yunnan by his linguistic ambitions and his somewhat complicated relationship with China, Van de Moortel has been responsible for communications at the World Agroforestry Centre's East and Central Asia office, and is now assisting the communications unit in the Southeast Asia office. His research is almost exclusively focussed on exploring Southeast Asia's colourful patchwork by bicycle.

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