Impacts of Palm Oil-based Biofuel Utilization Promotion Policy in the Thai Transport Sector

Abstract

This paper aims to provide an analysis of the impacts of the promotion policy of palm oil-based biofuel utilization in the Thai transport sector for the period 2020–2037. For this purpose, three scenarios are developed to represent different proportions of palm oil-based biofuel blending implemented in Thailand and their impacts are analyzed through the application of the Low Emissions Analysis Platform (LEAP) model. The analysis reveals that an increase in the proportion of palm oil-based biofuel in a diesel mix would provide several noticeable benefits, for example, help reducing diesel consumption, decreasing crude oil requirement, and mitigating emissions of CO₂ and PM2.5 – a major source of current environmental health problems. In addition, increased proportion of palm oil-based biofuel in the diesel mix would contribute to a growing demand for oil palm production and a plantation area to meet an increase in palm oil-based biofuel production. A high demand for oil palm production and plantation land requirement could, however, be emerging challenges. In order to address these challenges, the effective strategies could include a plan for agricultural crop zoning, crop breeding, the efficiency enhancement of biofuel conversion technology, the reduction of chemical fertilizers and pesticides, and the support from the government for research and development of second-generation biofuels. The analysis will be useful for Thai planners and policy makers to design policies to overcome the issues of energy and food security as well as climate change problems.