Refined palm oil or crude palm oil are the right solutions in today market to stay competitive as the cost of rapeseed oil, soyabean oil or palm oil feedstock accounts for around 80–95% of the operating cost of the biodiesel process and in the same rank for co-firing unit. A substantial increase in the production capacity and number of biodiesel manufacturers would create greater competition for the supply of vegetable oil feedstock, leading to upward pressure on prices.
In terms of production volume, palm oil is the world's second most produced vegetable oil after soybean oil. Palm oil exports come predominantly from Malaysia and Indonesia and these two countries can be expected to maintain their dominant position in exports of oils and fats, accounting for 45% of total trade.
Even without biodiesel, demand for palm oil would still be driven by the food segment. In Europe , there is less rapeseed for food purposes as more rapeseed are being used as feedstock for biofuel. Palm oil can come in to fill in the gap left by rapeseed in the food segment.
Crude and refined palm oil have not only economics advantage for fuel for CHP / co-firing industry but also have the better power properties than rapeseed and soya
Palm oil itself can be used in plants as an ignition fuel, replacing fossil-derived heavy fuel oil. In this way, the CO2 emissions that would have been created by the fuel oil (approximately 3 tonnes of CO2 per tonne of heavy fuel oil) are avoided.
