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Norway tightens regulations on use of PFAD for biodiesel

The Norwegian Environmental Ministry plans to introduce stricter sustainability criteria for biodiesel made from PFAD, a by-product of palm oil production, Norwegian Broadcasting Corporation NRK reported late Monday.

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PFAD, or palm-fatty-acid-distillate, is a byproduct of palm oil production and can be used as a feedstock for biodiesel. The classification of PFAD in Norway will change from 'waste' product to 'byproduct', effective from January 1, 2017.

The reclassification means PFAD-based biofuels will fall under the EU sustainability criteria, and will have stricter sustainability requirements.

"We have taken the decision based on new information about the significantly higher risk of increased greenhouse gas emissions by palm oil production than previously thought," Director of the Environment Directorate, Ellen Hambro told the NRK.

Environmental organizations such as Zero and the Rain forest Foundation urged that the change should be implemented as soon as possible.

"We will introduce the classification change as soon as practicable, but we must give market participants some time and a realistic chance to comply," Siri Sorteberg, Head of Transport and Energy, said.

The Norwegian biofuels mandate currently stands at 5.5% but will increase to 7% from 2017.

Several biofuels producers in Norway and the rest of Europe import PFAD to produce biodiesel. Notably, Finland's Neste uses the palm oil byproduct in the production of its HVO biodiesel at its NEXBTL plants.

--Reinout Geyssens, reinout.geyssens@platts.com
--Edited by Jonathan Loades-Carter, jonathan.carter@platts.com