He sells the fuel locally for 70 US cents (85 Aust cents) a litre, slightly less than the price of regular oil.

John Wolrath, who owns Solomon Tropical Products, moved to the tropical islands 12 years ago and opened six saw mills.

But political instability forced him to shut up shop and search for other opportunities.

"There were all these coconuts not being utilised, there was no coconuts being picked up at all," he said.

"They were just going to rot under the tree. And then I heard about coconut oil. So I decided to buy a small coconut mill that would do about a thousand litres of oil in a 24-hour period. And I"m going to make my fortune out of this small mill."

Coconut oil can directly substitute diesel or be blended with it to create a less polluting biofuel.

The Philippines, the world"s largest coconut oil exporter, this week introduced a one per cent coconut blend diesel.

Wolrath"s coconut fuel pumps are always busy with customers attracted by cheaper prices and the environmental plus.

The Solomons, once a British protectorate, has about 500,000 people scattered across a string of 992 small islands in the Pacific. Most Solomon Islanders live on agriculture and fishing.

The 20-member South Pacific Applied Geoscience Commission (SOPAC) says Pacific island states spend more than $US800 million ($A976 million) a year on fuel imports.

A SOPAC report said if these countries were to replace 50 per cent of diesel imports with coconut oil then the region"s average import bill would be cut by 10 per cent.

Governments around the world are mandating biofuel use to improve domestic energy security and cut greenhouse gas emissions from burning fossil fuels, though most biofuels come from other sources such as sugar cane, corn or palm oil.

Lacking capital to expand his business, Wolrath has appealed to aid organisations to help.

So far, he has not received any, but aims to continue producing his environmentally-friendly fuel.

"If the aid donors get behind it, we could be producing 10 tonnes a day of eco-friendly coconut, or coco bio-diesel, which is 100 per cent green," he said.

Australia is spending about $US700 million ($A853.92 million) to maintain peace in the Solomons after the nation came close to collapse due to violence and mismanagement.

A tsunami hit the islands in April.

PIN/THEAGE.COM.AU