As the value of crude oil exports dwindle, palm oil is becoming an increasingly important strategic sector for Malaysia. One of the measures taken by the Malaysian government to bolster support for the palm oil sector is by mandating the use of biodiesel – a blend of palm oil and diesel fuel.
Currently, all diesels sold in Malaysia have 7 percent palm oil content, and are thus referred to as B7. The government plans to increase this to 10 percent later this year (B10).
Did you know that under the Malaysian Biofuel Industry Act 2007, the Plantation Industries and Commodities Minister has the power to enforce any type of biofuel at any blend as mandatory?
The plan to introduce B10 however, has met a lot of opposition. Critics say biodiesel is hydroscopic, meaning that it absorbs water from the atmosphere, leading to clogged fuel filters and injectors, as well as premature wear of rubber seals. The added blow-by gases also dilutes engine oil.
In the past, we have reported several car makers' stand on the subject but Malaysian Palm Oil Board (MPOB), the organisation developing the technology for biodiesel production in Malaysia, have recently reached out to us to have a roundtable talk at their research facility in Bangi. We were rather skeptical, but it's only fair to have opinions from both sides to be heard.
On hand to answer our questions on biodiesels were Dr. Lim Weng Soon, Deputy Director-General for Research and Development, accompanied by Principal Research Officers Harrison Lau Lik Nang (Ph.D) and Wan Hasamuddin Wan Hassan.
Our 2-hour long discussion touched on many topics but for brevity, we have summarized MPOB’s answers in an FAQ format below. The text below are not MPOB’s verbatim answer, but a summary of it.
But first, let’s answer the most obvious question here:
Can my diesel vehicle run on biodiesel?
Yes you can, but only up to B7. Beyond that, certain modifications to the engine is required. So far, there are only two diesel models in Malaysia whose manufacturers have confirmed that is compatible with – Mercedes-Benz E300 BlueTec Hybrid (previous W212 generation) and Peugeot 508.
As for other Japanese manufacturers, Toyota, Nissan, Mitsubishi have given a conditional acceptance, meaning that their standard engines can run on B10 only if the fuel’s properties have been modified to meet Japan Automobile Manufacturers Association’s (JAMA) requirements.
The modifications required are: water content specification limited to 200 ppm and minimum oxidation stability of 35 hours (Modified Rancimat Method). In addition, JAMA also requests that B7 to be made available at all fuel pumps even after B10 is introduced. The Japanese technical body opines that B10 should be limited only to engines running on Euro-4 or earlier emission standards. The newer generation of Euro-5 or higher engines can only run on B7.
At the same time, MPOB’s own studies, as well as those conducted by JAMA and Indonesia’s GAIKINDO (equivalent to our Malaysian Automotive Association, MAA) have shown that there are engines that can reliably run in the real-world using B10, more on that later.
Will my vehicle’s warranty remain valid if I fuel up my diesel vehicle with B10?
MPOB is confident that it will be business as usual when B10 is introduced later this year, pointing out Indonesia's have successful migration to B20. However note that the diesel vehicles used in Indonesia are mostly commercial trucks, not high-end passenger cars.
As mentioned above, most car companies have said that their engines are not compatible with anything higher than B7.
At the end of the day, it is the car companies and not MPOB who will be covering your diesel engine’s warranty. So until the manufacturer of your car can confirm that it is OK to use B10, the answer is no, you warranty will no longer be valid if you use B10.
If my vehicle manufacturer says I can’t use B10, what happens when B10 is mandatory?
When B10 is eventually rolled out, all fuel stations will still continue to carry B7. All Euro 5 diesel will continue to be B7 while regular Euro 2M diesel will be B10.
In highland areas, only B7 biodiesel (MPOB didn’t specify if it will be Euro 2M or Euro 5) will be available, to cope with the low temperatures.
So if you are not convinced with B10, simply switch to B7, which is of a higher Euro 5 grade anyway.
How much will B10 biodiesel cost?
As of January 2017, all diesel fuels sold in Malaysia are B7, with Euro 2M and Euro 5 grade diesel priced at RM2.05/litre and RM2.15/litre respectively.
Prices of B10 have yet to be confirmed, but MPOB says for every 1 percent increase in Palm Methyl Ester (PME) - the proper name for the palm oil extract blended into our biodiesel - production cost will increase by 1 sen/litre.
This opens another question regarding the rationale behind B10. It's more expensive to produce, but it can only be used on older generation Euro 4 or lower diesel engines. Meanwhile the more expensive Euro 5 or higher diesel engines, the premium performance diesel models, can only use the cheaper B7. Where is the logic?
When will B10 be introduced?
The government aims to mandate B10 sometime in 2017.
With the consumer advice out of the way, below are the finer details on the why and how of biodiesels.
The terms FAME and PME are often mentioned when talking about biodiesel. What’s the difference between the FAME and PME?
They are essentially the same. FAME stands for Fatty Acid Methy Ester while PME stands for Palm Methyl Ester.
Biodiesels can be produced from a variety of plant-derived sources, including soy, rapeseed and other vegetable oils. Depending on a country’s agricultural produce, different countries may use different materials to produce biodiesel. The US for example, uses soy while Malaysia uses palm oil.
FAME is the general umbrella terminology for these biodiesel blend, while PME specifically refers to palm oil-based biodiesel.
Throughout the article, you will come across terms like PME 10%, this refers palm oil-based B10. Biodiesel with 10 percent soy-based content for example, is referred to as SME 10%.
What are the technical standards set for our biodiesel?
All biodiesel produced and sold in Malaysia must meet Malaysia’s MS 2008:2014 standard, which according to MPOB, is even stricter than Europe’s EN 14214:2012.
MPOB explains that this is because our Malaysian MS standard B10 has a stricter tolerance on oxidation stability, made under request from Japan’s JAMA.
In simple terms, a higher oxidation stability ensures that the fuel will not expire so soon, and it is less likely to react negatively against metallic materials used in the fuel tank and fuel lines, especially those in older vehicles.
What are the results of the tests done with B10?
MPOB and DBKL have been conducting field trials with 75 vehicles since 2013, including five Peugeot 508, four Toyota Hilux, four Toyota Fortuner, one Mitsubishi Triton and one Mitsubishi Pajero Sport, as well as many more commercial trucks and buses. Some of the vehicles are fueled with B10 while others are fueled with B20 (all supplied by Petronas).
Some vehicles have clocked up to 300,000 km, and periodic inspections by MPOB have shown no anomalies, apart from trace amounts of engine oil dilution but MPOB says this is still within normal limits.
Fuel filter plugging was only found in cars using a much higher blend B20, and it was limited to PME produced by one supplier, while others were fine.
A sample fuel filter from a Peugeot 508 GT was shown, but we must add that the engine in the Peugeot 508 GT is very old, dating back to 1999, co-developed with Ford. It is not a good representation of the needs of the latest generation of diesel engines used by BMW, Porsche and Mazda.
Injector deposits were found in some buses with over 300,000 km but there was no effect on injector flow rate.
Tests done by Indonesia’s GAIKINDO using a common-rail turbo diesel engine with 200 MPa pressure fueled with B20 showed also showed no deposits accumulating on the injector.
Meanwhile, Japan’s JAMA test with a Euro 5 engine running on PME 10% type B10 showed a higher flow rate at the injectors than regular diesel, which JAMA said is due to PME's superior lubricating effect.
Earlier tests by JAMA using soy-type SME biodiesel have shown that vehicles that use metal fuel tanks can have their metal coatings bleached by the biodiesel, resulting in bleaching and accumulation of meat deposits inside the injectors.
At the request of MPOB, JAMA repeated the same test with PME10% and it showed no bleaching effect, due to the higher oxidation stability of PME 10%.
Dynamometer tests done by JPJ have also shown that there is no difference in performance when the engine is running on B10 or even B20.
To date, none of the vehicles have shown any deterioration in performance and specific engine components like oil filter and fuel injectors are periodically removed for inspections.
MPOB also shared case studies of similar trials in Colombia and Indonesia, but we feel that these are not good examples to support the case for B10 or B20 in Malaysia. We are quite certain none of the engines used in these trials were of the latest BMW EfficientDynamics diesel or Mazda's SkyActiv-D - still the world's cleanest diesel and one that meets all real-world driving emissions test without requiring exhaust after treatment systems.
The engines that were used in the Colombian and Indonesian trials were simpler engines designed primarily for commercial use, on taxi-specs Toyota Innova and 4x4 pick-up trucks, vehicles that are already designed for rough environments and have a high measure of tolerance against poor fuel quality, as engineers expect owners to sometimes fuel these vehicles directly from oil drums in rural areas. However that doesn't mean that Toyota can go on record to say it's OK to test the limits of tolerance for a long period of time.
In Malaysia, people drive their diesel BMWs and Mazdas at much higher speeds than their counterparts in Indonesia or Colombia, sometimes up to 140 km/h on long stretches of highways with 40 degrees ambient temperature. Even farmers transporting produce between Cameron Highlands to wholesale markets in Kuala Lumpur drive their Toyota Hilux at much higher speeds on the highway, every day. Having the local biodiesel association organizing a simple, one-off drive up to Cameron Highlands with B10-powered diesel vehicles don't prove anything.
Why don’t MPOB work with car companies to clear their doubts with a joint test?
The challenge for MPOB is that there are a lot of car manufacturers in the market, and they don’t normally share information with one another.
A test result conducted by Japan’s JAMA will not be recognized by a European manufacturer, and vice versa.
Further compounding the problem is that there is no universal standard to verify an engine’s compatibility with biodiesel. As explained earlier, there are many forms of biodiesel and the palm oil-based PME-type biodiesel is only one of them.
What is the response from oil companies?
At the moment, oil companies are asking to delay implementing B10. All the necessary investments in infrastructure to produce B10 have already been put in place but oil companies say they need more time to prepare their facilities to accommodate B10.
How many biodiesel production facilities are there in Malaysia?
There are currently 20 to 30 biodiesel production facilities in Malaysia, some are active while others are under construction. Only a small portion of the facilities are owned by palm oil companies. The rest are owned by companies from outside the plantation industry.
How sustainable is biodiesel? Wouldn’t it divert agricultural output meant for food, leading to rise in food prices?
The way MPOB sees it, biodiesel is simply reducing the component of fossil fuel used in the production of diesel fuel, substituting it with palm oil.
In Malaysia, ninety percent of our palm oil is already being exported so MPOB isn’t too concerned that diverting supply of palm oil for fuel will lead to an increase in food prices in the country.
What happens when palm oil fetches better prices overseas? Will local producers continue to supply local biodiesel producers instead of exporting?
Over the past five years, plans to execute biodiesel have remained even though prices of palm oil fluctuated. In MPOB’s opinion, this shows the government’s commitment to develop biodiesel.
They also went on to say that palm oil is a strategic advantage for our country and every step to grow the industry benefits Malaysians. For a palm oil producing country, diversifying the use of palm oil is crucial.
Biodiesel certainly offers good potential. Independent tests by Japan’s JAMA suggests that many concerns on negative effects of biodiesel, especially in terms of material compatability and injector plugging, does not apply to Malaysia’s higher quality palm oil PME-type biodiesel. However, we at Carlist.my also believe that these alone are not sufficient to conclude that B10 biodiesel is suitable for all diesel vehicles.
In fact, JAMA’s report specifically mentioned that the conclusion on B10’s compatibility must come from the vehicle manufacturers.
Car companies are private business entities. They have every incentive to maintain a good relationship with the government of the country where they do business in. When they do express opposition to a particular government policy, they usually have a very good reason behind it.
Before an engine is released for sale, powertrain engineers spend thousands of hours validating computer simulation and lab test results with on-road driving - test runs in freezing Artic, to scorching deserts of Nevada, to sustained high speeds on German autobahns, many punishing laps at the highly uneven Nurburgring Nordschleife circuit, towing trailers up the Swiss Alps and oxygen starved Andes. Warranties aside, manufacturers have to ensure that their engines last at least 300,000 km or 15 years of fair use.
If someone wants to run their engine with a fuel that the engine was not originally designed for, they have reasons to be cautious.
Given enough advance notice, and a reasonable business justification (it costs time and money to adapt an engine to B10), engineers can retune their engines to run on any type of biofuel.
Every car in Brazil runs on biofuel – 100 percent ethanol fuel (E100), and car companies have no complaints because the Brazil’s biofuel policy have been outlined energy road map that was drawn up in the 1970s.
Most petrol-powered cars sold in Thailand today can run on either E20 or E85 gasohol (mix of petrol and ethanol), and when it was implemented, it was pretty much business as usual because Thailand's biofuel plan has been announced since 2008, and Thailand rarely flip-flops on its policy so when the government announces something, businesses can be certain that it will be followed through.
Malaysia is a small market and it’s difficult to compel car companies to make specific adjustments to their engines within such a short period of time.
The correct way forward to promote biodiesel would be to work with Indonesia – the largest car market in ASEAN – to draft a long-term alternative fuel road map for car companies to work with. But this is easier said than done because Malaysia and Indonesia are fierce rivals in the palm oil sector.
If palm oil lobby groups are so certain that the car companies are wrong about B10, and that existing test results supporting B10 are good enough, then they should get take up the responsibility of paying out warranties for any potential engine damage due to longterm use of B10. Short of that, their assurances don't mean anything.
If B10 is forced on to the market and started damaging diesel engines, the resulting stigma will permanently condemn biodiesel, which is a shame because as proven by JAMA's tests, Malaysia's PME biodiesel is the best around and it deserves a chance to succeed. What the automotive industry is asking for is a clear road map and to give them enough time to tune their diesel engines to run on B10.