My Say: The palm oil industry can be net-zero carbon by 2040

This article first appeared in Forum, The Edge Malaysia Weekly, on November 15, 2021 - November 21, 2021.
My Say: The palm oil industry can be net-zero carbon by 2040
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As chemical engineers and members of IChemE’s POPSIG (The Institution of Chemical Engineers’ Palm Oil Processing Special Interest Group), we have been closely following the COP26 climate change summit in Glasgow, which ran from Oct 31 to Nov 12. Ahead of COP26, we noted that on Sept 27, Prime Minister Datuk Seri Ismail Sabri Yaakob announced that Malaysia was committed to its target of becoming a carbon-neutral nation by as early as 2050. Ismail Sabri accelerated plans on Oct 11 to reduce the intensity of greenhouse gas (GHG) emissions across the economy by 45% based on the GDP in 2030. Our stand would be tabled at COP26.

The pledges

At COP26, several key pledges have been agreed on and, for us, the most significant are:

•    The declaration to halt and reverse deforestation and land degradation by 2030;

•    Nations agreed to slash their methane emissions by 30% by 2030, compared with 2020 levels; and

•    Ten of the world’s biggest global agricultural trading and processing companies issued a joint statement, committing to a sectoral roadmap by COP27 for enhanced supply chain action consistent with a 1.5°C pathway. These companies — Archer-Daniels-Midland Co, Amaggi, Bunge Ltd, Cargill Inc, Golden Agri-Resources Ltd, JBS SA, Louis Dreyfus Company, Olam International Ltd, Wilmar International Ltd and Viterra Inc — manage large global trade volumes in key agricultural commodities: soy and palm oil.

Palm oil has the lowest CO2 emissions

So, what action can the palm oil industry take? Fortunately, it started its sustainability journey early and has a 15-year head start. On Sept 30 in Milan, Maria Vincenza (Cinzia) Chiriacò of CMCC (Euro-Mediterranean Centre on Climate Change) presented a paper titled “The environmental impacts of palm oil and main alternative oils”. Palm oil has an average emission of 0.45 metric tonnes of carbon dioxide equivalent per tonne (MT CO2eq/MT) oil compared with 2.89 for soy, 2.47 for rapeseed and 1.18 for sunflower.

The palm oil industry is approaching net-zero carbon emissions

Kuala Lumpur Kepong Bhd published its Sustainability Rating Report on Oct 21, reaffirming its sustainability rating at Gold (G2).

As a member of the Roundtable on Sustainable Palm Oil (RSPO), KLK has committed to no deforestation, no peat and no exploitation (NDPE) and used the RSPO GHG calculator to measure its GHG emissions. KLK figures are in line with Maria Vincenza Chiriacò’s data.

It is imperative to measure data for improvement. The soon-to-be available MSPO (Malaysian Sustainable Palm Oil) GHG calculator will serve us well in this respect. Consequently, we can see where we stand with 96% of plantations and 89% of mills certified to MSPO. Bear in mind, only 20% are certified to RSPO.

So, how do we get ourselves towards net-zero carbon emissions?

Getting to net-zero carbon

We would like to suggest a solution by considering the palm oil industry as upstream and downstream. Upstream would consist of the plantation and the mill while downstream would be the refineries and oleochemical plants. For downstream, the approach would be very different, as there is just not one product, namely crude palm oil (CPO), and the processing plants would be similar to those in the food and chemical industry.

Figure 1 illustrates that sustainable palm oil has a significant reduction in GHG emissions compared with conventional palm oil (without good agricultural practices [GAP]). The results of our calculations by taking the plantation and mill as one are shown in Figure 2.

The first bar of 2.94 MT CO2eq/MT CPO is for a plantation without GAP and a mill powered by diesel and electricity supplied by an external source. The second bar of 0.634 MT CO2eq/MT CPO accounts for GAP and the mill using all its biomass and biogas for energy generation. The availability of four tonnes of biomass (empty fruit bunches, mesocarp fibre, palm kernel shells) for every tonne of CPO is noteworthy here. The GHG from biomass is discounted in the last bar of 0.072 MT CO2eq/MT CPO. This argument is valid, as the biomass is renewable and a by-product of the milling process. Insufficient biomass prevents the nullification. With net-zero carbon in sight, it can be met with actions that we will cover later downstream. Increasing the yield and the OER (oil extraction rate) upstream would also reduce the emissions per tonne.

Use of biomass has challenges

Besides possessing a low calorific density, if utilisation of biomass for energy (thermal and electrical) were convenient and easy, its utilisation in the mill would be earlier than expected. Most biomass cannot be used as such and needs to be prepared by various methods such as shredding, drying, grinding and pelletising. Design of biomass-based boilers are specific to application and biomass used, with cleaning of ash required every 45 to 60 days.

The refining and oleochemical industries have seen improvements in technology because of customer demand. With the increase of demand in plants, technology suppliers have invested in R&D. We believe the same can apply to boiler technology.

This necessitates investments by mills, probably supported with matching government grants to be in line with Malaysia’s net-zero carbon target. Perhaps some of the RM12 billion windfall tax could be channelled here. Such a programme could be as short as 10 years or as long as 20 years, but may be accelerated to well before 2050.

What can be done downstream?

Seventy-five per cent of our GHG emissions comes from energy and transport. We have the Efficient Management of Electrical Energy Regulations (EMEER) 2008, where a registered electrical energy manager is appointed to report electrical energy savings every six months. There are registered Energy Service Companies (ESCO) that provide very attractive consultancy services in saving electrical energy. We should have a similar set-up for thermal energy. These will help factories reduce their Scope 1 and Scope 2 emissions.

At Monash University Malaysia and other universities, our undergraduate students are taught to prepare them for climate change and they apply global warming potential, resource depletion and heat integration in their final-year design project. The most widely used heat integration technique by chemical engineers is the Pinch Analysis Method.

The above can be applied to the mills to save energy in their last mile towards net-zero carbon emissions.

A downstream example is IOI Corp Bhd, which is a leader in energy management. In September, IOI Edible Oils Sdn Bhd was the winner in the Renewable Energy (Cogeneration) category at the National Energy Awards. The award-winning steam boiler was designed, constructed, installed and commissioned by IOI Bio-Energy Sdn Bhd’s in-house steam engineers in October 2019. It uses empty fruit bunch fibres and palm kernel shells as fuel to generate power.

Benefits of achieving net-zero carbon emissions

The palm oil industry has been continuously plagued by accusations of deforestation and exploitation of labour despite its efforts in sustainability. Net-zero is a step further as it nullifies the claim of deforestation while enhancing the industry’s sustainability credentials.

In aspiring to be green, importing countries are becoming wary of importing goods (Scope 3 emissions) that carry high carbon emissions. In the EU’s Green Deal to prevent “carbon leakage”, it introduced the Carbon Border Adjustment Mechanism (CBAM) in July 2021.

Conclusion

The Malaysian government has made significant and stretching commitments to climate change mitigation at COP26. It will now be looking hard to find ways to meet these commitments, and the palm oil industry, as we have shown, can play its part, as it knows what needs to be done. The achievements will not only benefit the nation but also improve the image of Malaysian palm oil globally. And this can come before 2050, as the palm oil industry could be net-zero by 2040.


Ir Qua Kiat Seng is senior lecturer and fellow at the Monash-Industry Palm Oil Education and Research (MIPO) platform. Dr Jaybalan Tamahrajah is senior technologist at KL-Kepong Oleomas Sdn Bhd.

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