Global biofuel supply chains reveal systemic fraud: Neste’s palm oil-to-jet fuel pipeline exposes greenwashing in waste-to-energy transitions

Indigenous communities in Malaysia and Indonesia have documented how palm oil expansion for 'sustainable' biofuels has led to land dispossession, with the fraudulent waste oil supply chain exacerbating these trends. Traditional agroforestry systems in Borneo, which integrate palm oil with food crops, are systematically replaced by monoculture plantations supplying Neste and other EU biofuel producers. Certification schemes like RSPO and ISCC fail to recognize indigenous land tenure rights, instead privileging corporate supply chain audits that overlook local knowledge of sustainable oil extraction.

The fraudulent waste oil supply chain mirrors historical patterns of resource extraction in Southeast Asia, where colonial-era palm oil plantations displaced local food systems, and modern 'green' mandates repeat these dynamics. The 2015 Southeast Asian haze crisis, driven by palm oil-driven deforestation, was a direct result of similar supply chain opacity and corporate accountability gaps. In the 1990s, the EU’s biofuel subsidies for rapeseed oil led to indirect land-use change in Eastern Europe, foreshadowing today’s palm oil-to-jet fuel pipeline. The current scandal echoes the 2008 food price crisis, where biofuel mandates in the Global North diverted food crops, triggering famine in the Global South.

In India, traditional oilseed-based biofuel systems (e.g., jatropha) were abandoned after corporate interests co-opted the sector, mirroring the current palm oil-to-jet fuel pipeline. In West Africa, where palm oil originated, smallholder cooperatives have developed low-impact extraction methods, but these are excluded from global supply chains dominated by industrial plantations. The EU’s classification of palm oil as 'advanced biofuel' reflects a Eurocentric view of 'waste' that ignores local circular economies, such as the use of palm oil mill effluent for biogas in Malaysia. Indigenous Maori communities in New Zealand have successfully challenged biofuel mandates that threatened food sovereignty, offering a model for cross-cultural resistance.

Life-cycle assessments of Neste’s palm oil-based jet fuel consistently underestimate indirect land-use change (ILUC) emissions, which can negate up to 90% of claimed carbon savings. The fraudulent waste oil supply chain exploits gaps in the EU’s Renewable Energy Directive (RED II), which allows feedstocks to be relabeled as 'waste' without third-party verification. Scientific studies show that palm oil expansion in Southeast Asia has led to biodiversity losses equivalent to 1.5–3.5 times the emissions saved by biofuel use. The lack of isotopic tracing in biofuel certification enables fraud, as fresh palm oil cannot be distinguished from genuine waste oil without advanced analytical techniques.

In Southeast Asian art, palm oil plantations are often depicted as 'green deserts'—monocultures that erase biodiversity and local cosmologies tied to sacred forests. The fraudulent supply chain reflects a spiritual disconnect where corporations treat ecosystems as infinite resources, ignoring indigenous animist beliefs that view land as a living ancestor. In Western art, biofuel campaigns often use pastoral imagery to mask industrial extraction, echoing colonial-era 'civilizing' narratives. The scandal reveals how 'green' aesthetics can obscure extractive realities, a theme explored in works like Tania Bruguera’s 'Untitled (Study for a Portrait)' which critiques corporate greenwashing.

If current trends continue, the fraudulent waste oil supply chain could expand to other 'sustainable' aviation fuel feedstocks, such as soybean oil or animal fats, as demand outstrips genuine waste streams. Scenario modeling suggests that by 2035, biofuel mandates could drive an additional 12 million hectares of deforestation in Southeast Asia, negating 60% of the EU’s aviation decarbonization gains. Alternative models, such as algae-based biofuels or synthetic fuels powered by renewable energy, could reduce fraud risks but require significant R&D investment. The EU’s proposed ban on palm oil biofuels by 2030 may shift fraud to other feedstocks, necessitating a systemic overhaul of certification schemes.

Indigenous communities in Malaysia and Indonesia have documented land grabs linked to Neste’s supply chain but are excluded from EU certification processes like ISCC and RSPO. Waste picker cooperatives in Malaysia, who could provide genuine used cooking oil, are systematically excluded from supply chains in favor of industrial plantations. In the EU, migrant workers in biofuel feedstock production (e.g., rapeseed harvesting) face precarious conditions, yet their voices are absent from policy debates. The fraud reveals how 'green' transitions often rely on the labor and land of marginalized groups while externalizing costs to ecosystems and local communities.