Proponents of burning wood and other biomass say it's more reliable than solar or wind, because it can supply power continuously, not just when the sun is shining or the wind is blowing. Its use reduces the need for fossil fuels, they say, and carbon released while burning biomass doesn't harm the environment because it's offset by carbon removed from the atmosphere when the organic material is growing.

"Palm oil is carbon-neutral while, with fossil fuels, the more you use the more CO2 is emitted," said Masaru Kubo, vice president of Osaka-based Sankei Energy, which built a 2-megawatt plant to burn the fuel. "We think using palm oil will help deter global warming," he said, adding he was hopeful there would be more certified palm oil available to ensure the sustainable use of the fuel.

But the impact calculation can get complicated. In deciding the value of palm oil, the maths has to account for extra emissions caused by the draining and burning of carbon-rich swamps known as peatlands and tropical forests that are destroyed to make way for oil palm trees, according to the Union of Concerned Scientists. Most of the trees are grown in Malaysia and Indonesia.

Taking into account those land-use changes, emissions from burning palm oil are more than twice as high as coal, according to a report by Takanobu Aikawa, a senior researcher at the Renewable Energy Institute in Tokyo. Mr Aikawa said imported biomass fuels weren't excluded when the feed-in tariff program began, but plants that used forest materials were given a higher rating to support domestic products.

"What had been anticipated were pellets and chips and maybe palm kernel shells, and they are all solid biomass fuels," Mr Aikawa said. Liquid biomass such as palm oil is "hardly used in power generation worldwide, so it was totally unexpected".