**2.3 Circular economy**

Oil palm fronds (OPF) and trunks (OPT) from oil palm plantations, as well as EFB, MF, PKS, and POME from palm oil mills, are all biomass waste produced by the oil palm. For every ton of crude palm oil produced, 9 tons of biomass are created [57]. Conversion technologies, on the other hand, have been created and commercialized in order to better convert waste into a more usable product. While biorefineries may be able to convert these wastes into biofuel and other biochemicals, the oil palm industry may require fertilizer, steam, fuel, and electricity for their plantation and manufacturing facilities [58].

The linear economy, in which solid wastes such as OPF and OPT are disposed of to plantations for natural decomposition and liquid wastes such as POME are treated in open pond systems without biogas capture, fails to capitalize on the oil palm's potential economic profits [59]. Through the recycling of biomass waste, the oil palm industries and biorefineries, as consumers of oil palm products, can be targeted to achieve a sustainable circular economy. **Figure 1** depicts the difference between linear and circular economies. In this figure, the linear economy (from i to iv) encompasses harvesting and processing of FFB into CPO after which all the by-products are disposed of at dumping sites and landfills with the consequence of environmental pollution, health hazards and no economic return. However, in the circular economy, there is the treatment, further processing, recycling and re-use of

#### **Figure 1.**

*Distinction between linear and circular economy. (i) Oil palm tree produces (ii) Fresh fruit bunch which is processed at the factory into (iii) CPO. By products (iv) such as fibre, shells, empty fruit bunch, shells, trunk, POME etc. are obtained. All these waste are disposed of by dumping and landfills with consequences of environmental pollution and health hazards. This whole process constitutes the linear economy. In the circular economy, fibre and shells as parts of the by-products (iv) are recycled as boiler fuel (iv) to produce power at the factory for continual processing. Similarly, the EFB from (iv) is processed into organic fertilizer (vii) which is used to fertilize the oil palm tree (i) to increase yield. In addition, POME from (iv) is treated to produce biogas and organic land fertilizer (viii) which goes back to the factory as energy and to the oil palm tree as fertilizer respectively. The trunk in (iv) is further processed into furniture (ix) for office and residential uses. This circular economy leads to less environmental pollution, minimal health hazards, reduce cost of production in (x).*

#### *Sustainability of the Oil Palm Industry DOI: http://dx.doi.org/10.5772/intechopen.100156*

the waste into boiler fuel, biogas, land organic fertilizers, furniture's etc. to produce power for the continuous running of the factory thereby reducing electricity bill, fertilization of oil palm plants to improve the yield and reduce cost of production and furniture for offices.

POME, EFB, decanter cake, and palm pressed fiber can be turned into new value-added goods (fertilizers) or used as an alternative energy source to power the manufacturing plant, thereby converting waste into wealth. Mattresses and cushions made from dried long fiber, renewable energy pellets and briquettes, and animal feed are examples of value-added products. Integrating the circular economy into palm oil production is an effective way to maximize the use of resources (raw materials) while reducing waste, pollution, and energy inefficiencies. This is accomplished by the reduction, reuse, and recycling of materials that are currently underutilized in the linear economy.

The circular economy is without a doubt one of the greatest sustainable development frameworks for the oil palm industry to effectively tackle biomass wastage issues while also avoiding high production costs, lowering negative environmental impact, and conserving resources for future generations. To maintain a competitive edge over the linear economy, better facilities, the incorporation of more advanced technology, and significant investment in the industry are required.
