The Department for Transport has launched an investigation into the environmental credentials of a fuel dubbed "green diesel", a renewable diesel increasingly adopted by UK fleets.
According to a new report from Transport & Environment (T&E), HVO has seen dramatic growth in popularity among businesses aiming to reduce transport emissions.
Government data reveals its use in the UK has surged from just eight million litres in 2019 to approximately 699 million litres in 2024.
Producers of this drop-in biofuel claim it can reduce carbon emissions by up to 90 per cent due to its production from waste materials such as used cooking oil.
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The Department for Transport said it was treating the concerns 'seriously'
GETTYHowever, serious questions have emerged about whether the fuel delivers on its environmental promises following a new study by T&E, which has uncovered alarming discrepancies in the supply chain of HVO fuel.
The research found that almost twice as much palm oil mill effluent (POME) is being used in European biofuels as is globally available.
Official figures show more than two million tonnes of POME oil were consumed in European biofuels in 2023. This significantly exceeds the estimated one million tonnes available worldwide.
The green credentials of HVO rely heavily on it being produced from waste sources, particularly used cooking oil or POME.
This finding raises serious questions about the actual environmental benefits of the renewable diesel being used across the UK and Europe.
Industry whistleblowers believe large amounts of these materials are not waste but virgin palm oil being fraudulently relabelled.
This suspicion comes as conventional palm oil use in biofuels has fallen 80 per cent since 2019, following the EU's decision to phase out palm oil biofuels from renewable targets by 2030.
Meanwhile, waste-based alternatives like POME have taken their place, now comprising 40 per cent of EU biofuels. T&E warns that palm oil may simply be entering Europe under a different name.
Cian Delaney, biofuels campaigner at T&E, commented on the report, saying: "It appears a lot of POME could be just palm oil in disguise.
"This raises serious concerns as to whether this renewable diesel or HVO is as green as oil majors say it is."
Spain, Italy, the UK and Germany were identified as Europe's biggest consumers of POME in 2023. A third of Spanish biofuels came from POME, whilst Italy relied on it for nearly 20 per cent.
The rapid increase in POME biofuels use has driven prices to nearly 90 per cent of palm oil prices by mid-2024.
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Use of HVO has become far more common in recent years
GETTY
This price convergence suggests that a potential reclassification of POME from residue to by-product may be needed if its value continues to rise. European oil majors spent £2 billion on POME in 2023 alone.
In January, the Indonesian government published data showing POME exports in 2023 and 2024 far exceeded their estimate of total capacity.
The Department for Transport said they "take the concerns raised seriously and are working with stakeholders and international partners to gather further information".
