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Comments on the EPA Palm Oil Pathway Notice of Data Availability, 27 April 2012

Comments on the EPA Palm Oil Pathway Notice of Data Availability, 27 April 2012

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Comments re. the EPA’s initial analysis of the carbon intensity of palm oil biodiesel production.
Comments re. the EPA’s initial analysis of the carbon intensity of palm oil biodiesel production.

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© 2012 International Council on Clean Transportation
Washington Berlin San Francisco+1 202 534 1600 +1 415 399 9172chris@theicct.org|www.theicct.org
Comments of the ICCT on EPApalm oil pathway NODA
 Author: Dr Chris MalinsDate: 27 April 2012
The ICCT believes that the EPA’s initial analysis o the carbon intensity o palmoil biodiesel production is an important contribution, and we are supportive othe overall methodology. However, there are several points on which we believethere is room or improvement in the analysis – we would urther anticipate thatthe overall result o adopting such improvements would be to increase the carbonintensity value proposed or palm oil biodiesel.
It seems likely that 2022 yield predictions are too optimistic. We wouldrecommend that serious consideration be given to the credibility o thecurrent values, and suggest that 4.7 tCPO/ha and 4.8 tCPO/ha or Indonesiaand Malaysia respectively might be considered the upper bounds on theappropriate assumption or the 2022 value, i one is optimistic about continu-ation o recent trend yield growth. Without that optimism, values not morethan 4.5 tCPO/ha might seem reasonable, and thus we suggest that it wouldbe appropriate or the EPA to adopt a value around 4.5 tCPO/ha as thecentral estimate. While current government initiatives exist to boost palmyields, we see no reason to believe that even i these initiatives work yieldincrease will grow substantially above the trend rate.
The GEOMOD approach to land use prediction is undamentally awed ascurrently applied to oil palm. While it has some prima acie appeal comparedto MODIS data as previously used, we show that the predictions are so out osync with what is generally expected by industry analysts, and with analysiso historical trends, that the approach should be abandoned or this pathway.With additional work, a uture iteration may represent a useul addition or
2 International Council on Clean Transportation CommentsICCT comments on the EPA palm oil NODA
uture revisions to the various pathway analyses.
A wealth o current evidence supports the expectation that more oil palmplantations will be placed on peat in the next ten years than the last ten. Thecurrent analysis assumes the opposite. We recommend that the EPA shouldassume in its analysis that at least 32% o new palm plantations planted inresponse to RFS2 would be on peat – we consider this value conservative, asit assumes the recent acceleration will stop, so a value o perhaps up to 50%would be appropriate or any sensitivity and uncertainty analysis.
There is no strong evidence that policies currently in eect are havingor will have a strong eect in limiting palm oil expansion on peatland.Miettinen et al. (2012a) show that neither policy nor physical limitations willprevent expansion on peat rom continuing to 2022. The Indonesian peat/orest conversion moratorium contains substantial carve outs to allow palmplantation expansion to continue. Neither RSPO nor ISPO is expected to placesubstantial restriction on peat conversion in the near term. The EPA shouldre-evaluate the palm biodiesel pathway in uture should it be clearly demon-strated that policy measures to prevent land use change emissions are inplace and eective, but should not pre-empt such policies beore they exist.
Current and future Indonesian and Malaysia palm oil yields
The data in the FAPRI-CARD model seem to suggest a surprisingly high estimateo both current and uture Indonesia palm oil yield. According to FAOstat FFByield in Indonesia has been relatively stable over the period 2007-2010 at 17.2 t/ha,while Malaysia FFB yields have been higher by nearly 25%, rising slightly rom 21.14to 21.20 t/ha in the same period. This could indicate that estimates o Indonesianpalm oil yields by FAPRI may be rather optimistic – at palm crushing yields o 0.2tCPO/tFFB (taken rom the input-assumptions document) this would be below 3.5tCPO/ha or Indonesia.Historically, Malaysian yields have been consistently higher than Indonesian yields,and we consider it unlikely that this gap will be narrowed entirely in the nextten years. It is true that USDA has made a case or robust yield growth in thisperiod, however we note that the assumption o a strong upwards yield trend issomewhat dependent on the period one considers.Figure 1shows that over the12 years rom 1998 to 2010, there has been a relatively consistent linear trend ogrowing yields, and notes that Indonesian palm plantation have a younger prolethan the Malaysia case. Oil palms reach peak yield at age 10-18 years
, so a highproportion o existing Indonesian trees will still be in the highest yield bracketin 2022. I current yield growth is sustained based on the linear trend, we wouldexpect a 2022 yield o about 4.7 t CPO /ha by 2022, slightly less than modelled inFAPRI. However, this consistent trend o yield growth is apparent only in the more
Comments International Council on Clean Transportation 3ICCT comments on EPA palm oil NODA
recent period – looking at longer term data rom USDA, we see that there hasbeen some variation and no long term consistency in yield growth (Figure 2). Wethereore believe that the assumption that current linear growth will be sustainedseems to be a plausible but at least somewhat optimistic assumption – henceto go beyond the USDA identied linear trend and expect a 2022 yield actuallyabove 4.7 tCPO/ha or Indonesia is likely to underestimate land use changes. Eveni current linear growth will be sustained, a lower assumption or 2010 averageyields more in line with FAO data would also suggest a lower 2022 yield.
Figure 1.
USDA FAS graph on Indonesian oil palm yield trends

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