Environmental activists are in disarray over a U.S. Environmental Protection Agency decision that transportation fuel made from palm oil does not produce sufficient environmental benefit to qualify as a renewable fuel under the 2007 Energy Independence and Security Act.
Ethanol and biofuels qualify as renewable fuels under the 2007 Act, benefiting from mandatory market share guarantees, if they are 20 percent cleaner than conventional fuels. According to a January 2012 preliminary life-cycle analysis by EPA, however, palm oil fuels likely fall short of the 20-percent standard.
Some environmental activist groups oppose palm oil fuels because large swaths of tropical rainforest are cleared to obtain the palm oil. Other environmental activist groups say the development of portions of tropical rainforest is a necessary price to reduce oil consumption.
EPA will announce a final decision later this year.
