From the Times Online:

A leading German utility has abandoned plans to convert a British power station to run on palm oil, in a blow to the promotion of biofuels in Europe.

The decision by RWE npower to scrap the project at its Littlebrook plant in Dartford, Kent, which was seen as a test case for palm oil as an alternative energy source, comes after it was unable to secure sufficient supplies without risking damage to tropical rainforest. The move highlights the mounting alarm over the scramble in South-East Asia to bring more land into palm oil cultivation.

There wasn’t enough palm oil that we could demonstrate was sustainable,” the spokesman said. “The bottom line is: are you contributing to global warming by chopping down rainforest?” The company hired independent auditors to establish whether palm plantations in Malaysia could be accredited to standards set by the Round Table on Sustainable Palm Oil, an organisation committed to promoting a sustainable palm oil industry

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The idea of sustainably grown palm is that a customer will buy from a competitor who meets sustainability standards. Instead, they scrapped using biodiesel altogether. That isn’t how it was supposed to work. I for one, hope to see more of this. Essentially, what is being said here is that the palm oil based biodiesel idea is a bust. Land must be cleared to meet demand and as long as people refuse to buy palm grown on such land, game over, as it should be. It will be interesting to see how this plays out with my local biodiesel importer. What would most multi-million dollar investors do if the difference between bankruptcy and solvency required use of unsustainable palm oil?