The UK government has launched an investigation into the burgeoning “green fuel,” known as HVO (hydrotreated vegetable oil) diesel, in light of allegations surrounding significant fraud. This inquiry emerges as HVO, celebrated for its potential to reduce carbon emissions by as much as 90%, is purportedly made from waste materials like used cooking oil. However, whistleblowers from within the industry have expressed serious concerns that a considerable amount of the fuel being marketed as HVO is actually composed of virgin palm oil, raising serious environmental and ethical questions about its true sustainability.
HVO has rapidly gained traction as a viable transport fuel alternative, particularly in the logistics and entertainment sectors, where music festivals and events are increasingly turning to this biofuel. Proponents claim it can significantly decrease emissions compared to traditional diesel. However, the BBC has revealed findings suggesting that the raw materials used in producing HVO may not be as environmentally friendly as advertised. Industry insiders have speculated that the market is rife with cases where virgin palm oil is being fraudulently labeled as waste-derived products, undermining the green credentials that this fuel promotes.
The Department for Transport has acknowledged the seriousness of these claims and stated that they are working collaboratively with stakeholders and international partners to gather more information. Despite the rapid growth in HVO consumption within the UK, jumping from 8 million liters in 2019 to approximately 699 million liters in 2024, doubts remain regarding the sourcing of key ingredients, particularly palm sludge waste, which is vital for HVO’s production.
Historically, the environmental benefits attributed to HVO hinge upon the assumption that it comes exclusively from waste sources. However, the alarming allegations that virgin palm oil is often used instead threaten not only the claims of sustainability but also contribute to environmental crises such as deforestation and climate change. The procurement of virgin palm oil disrupts critical ecosystems and threatens endangered species, such as orangutans, placing immense pressure on global biodiversity. According to an anonymous large European biofuel manufacturer, this palm oil “floods the market like cancer,” indicating that the scale of fraudulent activity is vast.
Further complicating the issue, whistleblowers have described a troubling corporate culture that incentivizes the use of non-waste materials while maintaining a facade that they are utilizing waste products. One anonymous trader recounted a case where they suspected they had bought consignments of virgin palm oil misclassified as palm oil sludge. In a shocking admission, a board member allegedly expressed disinterest in addressing the situation, citing concerns about evidence possibly being destroyed.
The complexities of this fraudulent landscape are further highlighted by a recent analysis revealing that European consumption of palm sludge waste far exceeds what the global market can feasibly produce. With the UK and EU reportedly utilizing about two million tonnes of palm sludge waste for biofuel in 2023, experts question the sustainability of such practices. Current estimates suggest that global production of palm sludge waste hovers slightly above one million tonnes per year, reinforcing suspicions that the demand for biofuels in Europe has led to increased reliance on virgin palm oil.
Dr. Christian Bickert, a German expert in biofuels, has commented on the issue by asserting that both sludge and pure palm oil share similar chemical compositions since they originate from the same plant source. He emphasized the lack of concrete documentation to corroborate these fraudulent claims, suggesting instead that numbers alone tell a troubling tale.
The sustainability claims surrounding biofuels are historically supported by certification systems aimed at ensuring raw materials are sourced responsibly. However, in regions like Indonesia, Malaysia, and China, where much of the claimed waste materials come from, verifiable supervision remains challenging. Many certification organizations, such as ISCC (International Sustainability and Carbon Certification), are hampered by regulations that prevent external inspection teams from verifying operations on the ground.
Various stakeholders, including construction giant Balfour Beatty, have been vocal about their sustainability concerns, ultimately opting not to use HVO. Balfour Beatty’s Jo Gilroy expressed frustration over the opacity of the supply chain, which fails to produce the requisite assurances regarding sustainability. In light of recent allegations, Irish officials have begun limiting incentives for fuels derived from palm waste, while the EU is reportedly preparing to enforce a temporary ban on ISCC certification pertaining to waste biofuels until further investigations can conclude.
As the UK grapples with these revelations regarding HVO and its sourcing practices, the repercussions of these practices resonate across the biofuel industry, sparking calls for clearer transparency and accountability. The ISCC has expressed surprise at the EU’s proposed measures, labeling them as detrimental to the market for waste-based biofuels. This ongoing situation presents a complex challenge for stakeholders seeking to navigate the intricate balance between fuels derived from waste and the broader environmental ramifications tied to their production and consumption.