National Biofuel Policy

The National Biofuel Policy is a main biodiesel policy in Malaysia. It was launched by federal government on 10 August 2005. The policy is primarily aimed at reducing the country’s fuel import bill, promoting further the demand for palm oil which will be the primary commodity for biofuel production (alongside regular diesel), as well as to shore up the price of palm oil especially during periods of low export demand.

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The main policy

Brief on new policy Malaysia’s National Biofuel Policy (interchangeably known as the National Biodiesel Policy) introduced by the government basically entails a four-prong strategy, which encompass:

1. Producing a bio-diesel fuel blend of 5% processed palm oil with 95% petroleum diesel.

1. Encouraging the use of biofuel among the public, which will involve giving out incentives for oil retail companies to provide biodiesel pumps at stations.

1. Establishing an industry standard for biodiesel quality, which will be the responsibility of SIRIM.

1. Setting up of a palm oil biodiesel plant, which is targeted to be built in Labu, Negeri Sembilan.

Japanese Diesel Engine Manufacturer to Open Biodiesel Research Center in Malaysia

JANUARY 18, 2007 Yanmar Co., a Japan-based global manufacturer of diesel engines and construction and agricultural machines, plans to build a facility in Malaysia to conduct research on the development of palm oil biodiesel, according to a report in Nikkei. The company plans to develop and test biodiesel for the industrial diesels it develops for its machines and generators. The new research facility, to be capitalized at ¥500 million (US$4.1 million), will be set up in Kota Kinabalu in east Malaysia, a major producer of palm oil.