Malaysia to raise biodiesel blend to B15 in push for energy security

Malaysia’s government has announced plans to increase its national biodiesel blending mandate from B10 to B15, as part of efforts to strengthen energy security and reduce reliance on fossil fuels. The decision was approved at a Cabinet-level discussion and will begin with an initial rollout of a B12 blend before scaling up further.

The move comes amid rising global energy prices and supply disruptions linked to geopolitical tensions, prompting the government to prioritise domestic energy resilience. By increasing the share of palm oil-based biodiesel in fuel, authorities aim to extend the country’s diesel supply and reduce dependence on imported fuels.

Importantly, the transition is expected to be implemented without significant additional costs, as Malaysia already has the necessary infrastructure and production capacity in place. Existing biodiesel blending facilities and supply chains will be utilised, allowing for a relatively smooth and rapid rollout of the higher blend mandate.

The policy forms part of Malaysia’s broader energy transition strategy, which includes scaling up renewable energy and diversifying the national energy mix. Officials have also indicated future plans to move toward even higher blends such as B20 and B30, particularly for commercial and transport sectors, reinforcing the country’s long-term sustainability and energy security goals.

Raising biodiesel blend from B10 to B15 (with B12 interim step and B20/B30 future targets) leverages Malaysia's palm oil production capacity while reducing fuel-import exposure. Existing blending infrastructure combined with supply chain readiness enables relatively low-cost implementation compared to alternative fuel-substitution approaches requiring new infrastructure.

The sustainability question depends critically on the palm oil supply base. RSPO-certified sustainable palm biodiesel delivers meaningful emissions reduction; palm biodiesel from newly deforested land can produce net-negative climate outcomes. Malaysia's MSPO certification framework and EUDR-compliance push (see related news) address this integrity dimension.

For biodiesel producers, palm oil companies, fuel distributors and financial institutions supporting Malaysian sustainable-fuel investment, Cognitud's climate action, sustainability due diligence and supply chain and operations teams help clients evaluate B15-scenario opportunities, structure supplier engagement on certified sustainable feedstocks, and prepare disclosures aligned with EUDR, RSPO/MSPO and jurisdictional biofuel-sustainability frameworks.