Need Incentives For Oil Palm Industry In Sabah

KOTA KINABALU: Policies and incentives are needed for the harnessing of renewable energy from Malaysia’s massive oil palm industry. State owned POIC Sabah Sdn Bhd chief executive officer Dr Pang Teck Wai said there was insufficient incentives for oil palm players to consider renewable energy. Agreeing that there was enough empty fruit bunches (EFB) for the harnessing of renewable energy, Dr Pang said there was no deterrence to compel oil palm players to reduce their carbon footprints. Dr Pang cited the example of Eco Biomass Energy Sdn Bhd, a Korean investor in the Lahad Datu palm oil industrial cluster which has encountered great difficulties in accessing biomass for their proposed biomass power plant. “It’s been more than two years now and the eco-biomass company is to secure sufficient long-term supply of EFB to enable them to start building their plant. “The potential suppliers were wavering in their prices and terms, waiting to take advantage of the situation. There’s no urgency because selling EFB has never been a major part of an oil palm mill’s income. ‘’There is no serious enforcement of laws to compel them to dispose of their EFBs, which is a major contributor of methane gas when they rot and methane gas is 20 times more harmful than carbon dioxide,” he added. Statistics show that Sabah produces over 30% of Malaysia’s palm oil but little of the oil palm biomass was being commercially utilised, he noted. He said POIC Sabah had intended the EBE’s plant to produce power and steam to supply the various palm oil-related industries at POIC Lahad Datu, which todate has 24 investors in refinery, bio-diesel, fertilisers and logistics. Dr Pang was commenting on reports quoting Malaysia Palm Oil Board (MPOB) chairman Datuk Sabri Ahmad as saying that Sabah can tap its power-generating potential from oil palm biomass, including methane gas from what is known in the industry as palm oil mill effluent that is about 65% methane. Dr Pang said a biomass policy that, among other issues, spells out government incentives and strict environmental requirements, is necessary not only for the production of renewable energy but also for the country to be able to take advantage of the huge volume of oil palm biomass. “For example, the estimated RM6mil needed for mills to install biogas-capture structure – unless there are incentives or legislative requirement or both, not many mills will bother to capture their POME gas,” he added. He also pointed out the numerous difficulties faced by players in claiming for carbon credits and complying with the Clean Development Mechanism principles. “We have received feedback that the auditing process is very cumbersome, and a disincentive for millers to try for some of the money to fund their carbon-saving activities,” he said. Source: The Star by Muguntan Vanar

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