Demand for Carbon Credits Will Continue

KUALA LUMPUR: The demand for certified carbon emissions (CER) or

carbon credits will continue to increase among developed nations despite

the Kyoto Protocol’s Clean Development Mechanism (CDM) agreement

expiring by 2012.

CDM consultancy firm Perenia Carbon Malaysia

Sdn Bhd senior associate Bhavna Khandar said countries like Japan,

Australia, the United States and the European Union (UE) were showing

increasing interests to buy carbon credits from developing countries.


Malaysia, over 80% of its CDM projects were from the oil palm industry.

They include renewable energy-related projects like biomass from palm

empty fruit bunches (EFB) and generating biogas via capturing methane

gas from the palm oil mill effluent (POME) ponds.


Protocol, increasing demand for carbon credits will help to push the

price of CER higher given the fact that demand is already higher than

supply right now,” Bhavna told a panel discussion on Green Renewable

Energy at the final day of the Oils and Fats International Congress 2010


CER, which is currently being sold at about seven to

eight euros per tonne, can be a good side income for oil palm plantation

and palm oil millers in Malaysia even though the revenue will not be as

good as selling CPO itself.

For Malaysia, one of the world’s

largest producers of palm oil, it is actually easier for its oil palm

plantation companies and millers to get actively involved in CDM

projects i.e. biogas and biomass plants, given the whole year round

availability of POME and EFB.

Bhavna also said it was timely for more oil palm players to venture into CDM projects.

However, of the 83 registered CDM projects in Malaysia, only five have managed to obtain the CER sale issuance.


there were plenty of good renewable energy to be CER issued, however,

many companies failed to be certified given improper planning and

incomplete data in their submissions resulting delays in project

commissioning,” she added.

Malaysian Palm Oil Board

director-general (R&D) Datuk Dr Choo Yuen May said the Government

was targeting the over 400 palm oil mills in the country to implement

the methane gas-capturing facility by 2020 thus reducing the carbon

emissions impact on the environment.

Currently, there are 24 local companies involved in biogas projects in Malaysia.

Choo pointed out that Malaysia was adopting the zero waste and zero emission policy for its oil palm industry.


said MPOB as the custodian of the oil palm sector would be looking at

the production of new products such as bioethanol and bio oils from palm

empty fruit bunches, trunk, shell and fronds, solid fuels from palm

biomass and synthetic diesel.

In addition, MPOB has identified jatropha and algae as new crops feedstock for biodiesel production.


the country’s biodiesel progress, Choo said the Government would

implement the mandatory B5 biodiesel programme by June next year in the

central region. The central region covers Putrajaya, Kuala Lumpur,

Selangor, Negri Sembilan and Malacca.

On the lack of incentive

for local biodiesel players to operate given the current high CPO price

at RM3,000 per tonne, she said MPOB would put up a roadshow for

biodiesel producers to possibly consider venturing into other lucrative

products like pytho nutrients.

Palm methyl ester or biodiesel could be be used as feed stock in oleochemicals and green solvents, she added.


International Medical University, Biomedical Technology Professor Dr

Chu Wan Loy said algae, which was creating rage overseas for the

production of healthcare products like spirulina and chorella, had

potential to be cultivated in the palm oil mills effluent ponds


“However, we need to harness the proper technology to ensure algae cultivation succeed in Malaysia,” he said.

Furthermore, algae is a non-food crop, thus making it an ideal feedstock for biodiesel, biogas and bioethanol production.


the issue of the EU Renewable Energy Directive being considered as a

discriminatory trade policy by many developing nations and also several

NGOs, ambassador and head of the EU delegation to Malaysia Vincent Piket

said: “We are only discriminatory to those non-sustainable biofuels

imported into the EU.”

Source : The Star by Hanim Adnan

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