Clean Biofuel For All

Clean Biofuel For All Coalition, is an alliance consisting of Community Organizations and Non-Government Organizations (NGOs,) which campaign for the importance of clean energy, does not damage the environment and provides justice for the community.

Biofuels are fuels that are sourced from vegetable elements (plants). In Indonesia, the main sources is oil palm. The goal of biofuels program is to replace fossil fuels that are not environmentally friendly.

According to Sitompul, 2020 states that it is 109 years of age for the oil palm plantation industry in Indonesia, an old age for a large business in this country.[1]

Processed palm fruit produces cooking oil, soap, shampoo, ice cream, and the latest is a fuel called biodiesel.

Indonesia's domestic use of palm oil diesel has increased sharply. By 2020, Indonesia will use more than 18 percent of its palm oil production for domestic use of palm oil diesel and by 2021, this percentage is likely to increase to nearly 25 percent, as the proportion of palm oil diesel mixed with conventional diesel will increase from 30 to 40 percent.

In the 2015-2019 period, the Indonesian government financially supported the use of domestic diesel with around USD 500 million per year. Hence, the government created additional demand for palm oil, after global palm oil prices fell due to the oversupply created by the palm oil industry.

In the period 2010-2014, so many forests and peatlands were cleared and planted for palm oil that ultimately global demand for palm oil could not keep up with supply.

The Indonesian government claims that domestic use of palm oil diesel reduces greenhouse gas emissions, compared to conventional diesel. The emissions reductions claimed by Indonesia stand in stark contrast to research on behalf of the European Union which concludes that palm oil diesel is worse for the climate than conventional diesel.

Many analysts predict that the price of CPO will go up, now Indonesia is releasing so much CPO from the market with domestic diesel. As in the principle of supply and demand economics, when CPO prices rise, it is likely that more palm oil will be planted and will further increase the pressure on forests and peatlands. Pressure on the surrounding environmental conditions.

Pertamina (Persero) has been entrusted with being the executor and handling of the largest volume of palm oil diesel by the Indonesian government. In 2020, his party will manage 88% of Indonesia's domestic diesel. However, according to the records of the #Cleanbiofuelforall Coalition, around a quarter of the biodiesel supply from supplier companies to Pertamina is not covered by the No Deforestation, No Peat conversion and No Explotation policies. Indications of the company groups that have not implemented this NDPE policy and indicated that they are responsible are: Darmex Agro, Permata Hijau, Tunas Baru Lampung and the BEST Group. Apart from other Pertamina suppliers that already have NDPE policies such as Wilmar International, Musim Mas, Apical, Golden Agri Resources and others.

The four companies mentioned earlier have not committed to ending forest / peat clearance within their own concessions and throughout their supply chains. The contradiction is that, instead of pushing these companies towards sustainability, the Indonesian government is rewarding them by offering them a large share of the domestic palm oil diesel market.

 

In its operation, the #Cleanbiofuelforall Coalition also noted that there are 24 banks, both national, private and regional banks, that have provided loans to the above palm oil diesel producers. It is indicated that four major banks in Indonesia, such as Bank Mandiri, Bank Negara Indonesia, Bank Rakyat Indonesia and Bank Central Asia, contributed half of this loan.

Of the 24 banks, only three banks, including HSBC Bank, Standard Chartered and Rabobank, require their debtors to apply NDPE policies. Reviews by many NGOs show that the major banks financing the palm oil industry for the bidiesel program have made little progress over the years by conducting vigorous due diligence on the risk of sustainability of credit proposals.

In fact, the #Cleanbiofuelforall Coalition noted that from 2015 to 2020 in the third quarter there was deforestation of 730,388 ha. In the same period of time, the area is equivalent to Kota Samarinda, East Kalimantan.

This is the responsibility of the entire palm oil supply chain starting from growers, traders, buyers and brands and don't forget the Bank as a credit lender or in other forms of cooperation.

NDPE (No Deforestation, No Peat, No Exploitation) is a policy that companies (producers, suppliers or buyers) must implement to achieve sustainable business and community welfare.

The coalition continuously monitors, researches and campaigns the implementation of NDPE policies throughout the biofuel supply chain in Indonesia.

[1] https://historia.id/ . Retrieved November 2, 2020.

PRINCIPLES & POLICIES

NDPE Policy

NDPE (No Deforestation, No Peat, No Exploitation) is a policy that must be carried out by companies (producers, suppliers and buyers) of palm oil to realize sustainable business and community welfare.

Program REDD+

Reducing Emissions from Deforestation and Forest Degradation (REDD) are efforts designed to reduce greenhouse gas emissions (GHG) resulting from deforestation and forest degradation processes.

GBEP Policy

GBEP measures indicators of sustainable bioenergy development. There are 24 indicators of sustainability which are grouped into 3 (three) pillars, namely environmental, social and economic and have been approved by 23 countries.

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