ScandAsia. Sweden News
Sweden Looks to Indonesia for Biofuel
01.06.2007 | text Kittisak Siripornpitak
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The next big thing is greener and cheaper
| In the attempt to reduce the use of fossil fuels by 2020, Sweden is eyeing on Indonesia for its supplies in cheap and green biofuel for motor as told by the Swedish Minister for Foreign Trade Sten Tolgfors.
Indonesia looks promising
Motor vehicles in Sweden are now using as little as 3% biofuel in the form of ethanol from Brazil and the government is aiming to have cars and buses running on palm oil-based biodiesel from Indonesia and reduce fossil fuels usage to 50% by 2020 to reserve its supplies and lower the carbon dioxide level in an effort to reduce global warming.
Tolgfors said Sweden's demand for biofuel can only increase as its government has been encouraging the use of environmental-friendly cars, such as those that can run on biofuel.
Swedish company Scanoil is already taking up Indonesia's lands to grow a plant that can produce biofuel, jatropha, which is the single largest Swedish investment in the country.
Rising biofuel usage
Norway's Statoil, a company that produces E85 biofuel - containing 85% ethanol and 15% gasoline - and sells it through 170 of its service stations in Sweden, reported sales growth of 270% on year to 19.5 million liters in 2006
In 2006, a total of 36,700 vehicles, or 13.5% of all newly registered vehicles in Sweden, were fitted with engines specially designed to run on biofuel, a 156% increase in biofuel-powered vehicle sales from 2005 as the government offers owners of biofuel-powered vehicles special benefits such as lower excise duties, free parking spaces and exemption from city congestion charges.
The adverse effects
Tolgfors expressed concerns over the environmental and social damages associated with growing global demand for biofuel. Indonesia and neighbor Malaysia together produce around 83% of the world's palm oil, and increasing demand for palm oil-based biofuel has lead to excessive deforestation in the two countries to make way for palm oil plantations.
In Indonesia alone, environmental groups estimate that tens of millions of people derive their livelihood from the country's forests, which also provide a home for many rare plant and animal species.
Due in part to plantation expansion, Indonesia's forests are disappearing at an estimated 2.8 million hectares a year, one of the world's highest deforestation rates - and increasing demand for biofuel feedstocks could increase that rate.
"There needs to be a process of quality control that ensures each step, from the planting of trees, right up to biofuel production, has been carried out with minimal destruction to the environment," said Tolgfors. "Consumers want to be assured that the environmentally-friendly product they bought is indeed environmentally-friendly or they are likely to not buy it in future."
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