Overview

On 14 March 2019, Indonesia’s political mandarins were shaken by the issuance of Supplementing European Union (“EU”) Directive of the EU Renewable Energy Directive II (“RED II”), which they believe treats Indonesian crude palm oil (“CPO”) in a discriminatory way. In essence, RED II concludes that biofuels which are being produced through the use of palm oil have led to massive deforestation, as the expansion of palm-oil plantations triggers high rates of Indirect Land-Use Change (“ILUC”), specifically through the clearing of forests and peatlands. The EU has therefore mandated that its member states should reduce their use of CPO-based biofuels in order to meet their greenhouse-gas emissions target by 2030.[1]