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REPUBLIC OF INDONESMINISTRY OF ENERGY AND MINERAL RESOURCES

Energy and Mineral Resources for People’s Welfare

Delivered by

EDI WIBOWODirectorate General of New, Renewable Energy, and Energy

BMZ Conference; Policy Forum

Opportunities for Sustainable Bioenergy Developm

Berlin, Germany, 28 May 2013

EPUBLIC OF INDONESIAMINISTRY OF ENERGY AND MINERAL RESOURCES


Delivered by:

EDI WIBOWODirectorate General of New, Renewable Energy, and Energy

BMZ Conference; Policy Forum

pment: National Experiences and Global Exchange

Berlin, Germany, 28 May 2013

FOCUSSED OF FOCUSSED OF

NATIONAL POLICYNATIONAL POLICY


PRO JOB PRO POOR PRO GROWTH

ENERGY AND ENERGY AND

FOOD SECURITYFOOD SECURITY

ENERGY AND ENERGY AND

FOOD SECURITYFOOD SECURITY

EMPLOYMENT EMPLOYMENT

CREATION AND CREATION AND

POVERTY REDUCTIONPOVERTY REDUCTION


ENVIRONMENTENVIRONMENTENVIRONMENTENVIRONMENT

PRO GROWTHPRO

ENVIRONMENT

LAW NO. 30 YEAR 2007 concerning on Energy

PRESIDENTIAL REGULATION NO. 5 YEAR 2006 concerning on National Energy Policy


PRESIDENTIAL INSTRUCTION NO. 1 YEAR 2006concerning on

Provision and Utilization, of Biofuel as Other Fuel

MINISTRY OF ENERGY AND MINERAL RESOURCES REGULATION NO. 32 YEAR 2008

concerning on Provision, Utilization, and Procedures of Commerce of Biofuel as Other Fuel

Priority supply and use of renewable energy, one of them is

biofuel.

Biofuel target 5% by 2025 from the national energy mix.


Instructions related to the Minister, Governor and Mayor to take

action in order to accelerate the provision and utilization of

biofuel;

1. Priority of biofuel utilization,

2. Mandatory of biofuel utilization (biodiesel, bioethanol, and

biooil) in transportation, industry, commercial, and electricity

generation sector,

3. Standard and quality of biofuel,

4. Pricing policy,

5. Commercial activities of biofuel,

BIODIESEL (Minimum)

Sektor 2008 2009

Transportation, PSO 1% (Existing) 1%

Transportation,

Non PSO

1%

Industry 2.5% 2.5%


Electricity Generation 0.1% 0.25%

BIOETHANOL (Minimum)

Sektor 2008 2009

Transportation, PSO 3% (Existing) 1%

Transportation,

Non PSO

5% (Existing) 5%

Industry 5%

BIODIESEL (Minimum)

2010 2015 2020 2025

2.5% 5% 10% 20%

3% 7% 10% 20%

5% 10% 15% 20%


1% 10% 15% 20%

BIOETHANOL (Minimum)

2010 2015 2020 2025

3% 5% 10% 15%

7% 10% 12% 15%

7% 10% 12% 15%

Raw Material

Palm oil, coconut, jatropha curcas, “nyamplung”, “kemiri sunan”,

and micro-algae

Sugarcane/molasses, cassava, sago, sorghum, corn, and ligno

cellulosic

Vegetable oil (straight vegetable oil)

Biomass through the process pirolisa and PPO (Pure Plant Oil)


Biomass through the process pirolisa and PPO (Pure Plant Oil)

MAIN POTENTIAL OF BIOFUEL: BIODIESEL

• Potential major biodiesel feedstock in Indonesia

production of 26 million tonnes. Of the total CPO

country for both cooking oil, chemicals, including for

• With a great potential for the production of CPO is

for fossil fuel substitution.

Type Use

jatropha curcas, “nyamplung”, “kemiri sunan”, Biodiesel Substitutes for diesel oil

ligno Bioethanol substitutes for gasoline

and PPO (Pure Plant Oil)

Biooil

Biokerosene

- Kerosene substitute

Substitute IDO


and PPO (Pure Plant Oil) Biokerosene Substitute IDO

(Industrial Diesel Oil)

on an industrial scale is CPO with a total annual

CPO production is only about 8 million tons used in the

for biodiesel, while the rest is exported;

the potential use of biofuel Biodiesel fuel is enormous

The use of biofuels has been started since 2006 with the issuance of Presidential Instruction No. 1/2006

Beginning in 2009, the government imposed a policy of mandatory use of transport, industry and power generation through the Minister of Energy and Mineral

Resources No. 32/2008.

Biofuel industry has grown in Indonesia. At present, the installed capacity for the type of biofuel to 4.25 million KL of biodiesel and bioethanolyear. Currently there are 23 producers of biodiesel and


year. Currently there are 23 producers of biodiesel and have licensed.

1. Utilization BBN currently has carried on:

a. Transportation sector (B-7.5

b. Industrial sector (B-2 in subsector be extended to other industrial sub

c. Electricity generation sector.

2. In 2013 the target of biofuelincreased to B-10

has been started since 2006 with the issuance of Presidential

Beginning in 2009, the government imposed a policy of mandatory use of biofuel in the transport, industry and power generation through the Minister of Energy and Mineral

2008.

At present, the installed capacity for the type of bioethanol amounted to 153 thousand KL per

year. Currently there are 23 producers of biodiesel and 8 producer of bioethanol that


year. Currently there are 23 producers of biodiesel and 8 producer of bioethanol that have licensed.

Utilization BBN currently has carried on:

.5),

in subsector mineral and coal mining industries) and will be extended to other industrial sub-sectors is gradually

Electricity generation sector.

biofuel utilization in the transportation sector will be

• Indonesia is the largest palm oil producer in the

world.. In 2011, Indonesia's palm oil production

amounted to 22.50 million tons, or 44.84% of the

world palm oil production. In the last 5 years

(2007-2011), Indonesia's CPO production grew

with an average of 6.24%.

• Based on ownership, the highest productivity of

CPO is owned by the government which is 3.04

tons / ha, Following the private and public

sectors respectively 2.57 and 2.38. Average

ESDM untuk Kesejahteraan Rakyat

sectors respectively 2.57 and 2.38. Average

productivity of Indonesian palm oil is 2.67 tons /

ha. It should be noted that the value is based on

ownership of land, not a plant area. Therefore,

the productivity is still able to increase.

• Meanwhile, MP3EI data showed that the growth of Indonesia's

Malaysia's 4.2% per year. Indonesia's palm oil productivity,

potential that is 7 tons / ha, and far from Malaysia that the

• In addition, based on the results obtained on the field, CPO

Indonesia's palm oil by 2010 reached 7.8% per year, higher than

productivity, according to this book is 3.8 tons / ha, Still far below the

the productivity reach 4.6 tons / ha.

CPO productivity of a company can reach 4.8 tons / ha.

Palm Oil Areas in Indonesia (Ha.)

Year Smallholder Government Private TOTAL

2007 2.752.172 606.248 3.408.416 6.766.836

2008 2.881.898 602.963 3.878.986 7.363.847

2009 3.061.413 630.512 4.181.369 7.873.294

2010 3.387.257 631.520 4.366.617 8.385.394

2011 *) 3.620.096 636.713 4.651.590 8.908.399

Palm Oil Productivity (kg/Ha) Productivity of palm oil by plantation


Year

Productivit

y

(Kg/Ha.)

2004 2,833

2005 2,925

2006 3,498

2007 3,634

2008 3,424

2009 3,487

2010*) 3,552

2011*) 3,607

FFB Production in Indonesia (Ton)

Year Smallhold

er

Government Private TOTAL

2007 6.358.389 2.117.035 9.189.301 17.664.725

2008 6.923.042 1.938.134 8.678.612 17.539.788

2009 7.517.716 2.005.880 9.800.697 19.324.293

2010 8.458.709 1.890.503 11.608.907 21.958.120

2011 *) 8.627.883 1.937.765 11.942.362 22.508.011

Productivity of palm oil by plantation

� Indonesia biodiesel production in 2011 amounted to 1.38 million

from the capacity of the industry which in 2011 counted

CPO or land area is pretty hard. This is because there

specifically for biodiesel. As we know that in addition

products such as Olein and Stearin. Similarly, palm oil

production of biodiesel.

� However, field study shows that the biodiesel productivity

land productivity of 4.64 MT PME / Ha.

No. Item


1. Productivity of palm oil by plantation Tonnes

year

2. Biodiesel processing efficiencies by

technology

MJ/tonne

3. Amount of biodiesel end product (mass of

energy content)

Tonnes

year

4. Production cost per unit of biodiesel USD/MJ

million MT, about 78% for export. Total production is still far

counted 3.77 million MT. Calculating the biodiesel productivity to

is no accurate data on the amount of CPO produced

to biodiesel, palm oil is also used for other downstream

oil land uses that are not specifically mentioned for the

reached 0.97 per MT of CPO or 38,412 MJ / ton CPO with

Unit Study National

Tonnes per ha per 4,8 2,67 (source: BPS

calculated)

3,8 (source: MP3EI)

tonne CPO 38.412

Tonnes/ha per

year

4,64

USD/MJ 3,28 (source: Aprobi)

COST COMPARISON FOR BIOFUEL PRODUCTION

Palm oil has the lowest cost of production amongst other vegetable oils

An

nu

al

Yie

ld p

er

He

cta

re (

ton

ne

s)

3

4

5

6

Palm Oil


An

nu

al

Yie

ld p

er

He

cta

re (

ton

ne

s)

0

1

2

100 200 300

Production Cost ($/tonne)

Rapeseed Oil

Source: Oil Worlld

COST COMPARISON FOR BIOFUEL PRODUCTION

Palm oil has the lowest cost of production amongst other vegetable oils

400 500 600 700 800

Production Cost ($/tonne)

Sunflower OilSoybean Oil

Rapeseed Oil

1. Biofuel potential for energy supply, climate improvement, and encourage the national

development;

2. Biofuel development is too fast and not controlled can lead to:

a. Competition for natural resources and rising food prices,

b. Deforestation and biodiversity decline,

c. Marginalization of land ownership by farmers and land ownership,

d. Greenhouse gas emissions in addition to the use of fossil fuels excessive,

3. There needs to be concern about sustainability issue.


3. There needs to be concern about sustainability issue.

Legality

Food security

Rural and

social

development

Human and labor rights

Consultation

planning and

monitoring

Greenhouse gas emissions

Sustainable

Biofuels

potential for energy supply, climate improvement, and encourage the national

development is too fast and not controlled can lead to:

Competition for natural resources and rising food prices,

Marginalization of land ownership by farmers and land ownership,

Greenhouse gas emissions in addition to the use of fossil fuels excessive,

There needs to be concern about sustainability issue.There needs to be concern about sustainability issue.

Land rights

Air

Economic efficiency

Water

Soil

Conservation &

biodiversity

Sustainable

Biofuels

1. Biofuel sustainability: biofuel production chain f

release of emissions into the air

2. Sustainable development is a mandate of Indonesia Constitution:

economic democracy with the principles of togetherness, efficiency of justice,

environmental friendliness, independence, and balancing economic progress and national unity”

3. Biofuel sustainability in Indonesia: Indonesia Sustainable Palm Oil (ISPO);

4. ISPO declaration on 30 of March 2011 and formally applied since March 2012;

5. Has been establish Regulation of Minister of Agriculture

on Guidelines Indonesian Sustainable Palm Oil (ISPO);


on Guidelines Indonesian Sustainable Palm Oil (ISPO);

6. Objective of ISPO:

a. Increase awareness of the importance of producing sustainable palm oil,

b. Improve the competitiveness of Indonesian palm oil in the world market;

c. Indonesia's commitment to supporting pelestaraian

functions as well as results of the Copenhagen Meeting 2009.

7. Because ISPO is based on the laws and regulatio

implemented for businesses plantations in Indonesia.

8. ISPO based on Indonesia regulation, law, and constitution

in from farm or forest up to the gas station and the final

Sustainable development is a mandate of Indonesia Constitution: “national economy based on

economic democracy with the principles of togetherness, efficiency of justice, sustainability,

environmental friendliness, independence, and balancing economic progress and national unity”

Sustainable Palm Oil (ISPO);

ISPO declaration on 30 of March 2011 and formally applied since March 2012;

Has been establish Regulation of Minister of Agriculture No. 19/Permentan/OT.140/3/2011 concerning

Guidelines Indonesian Sustainable Palm Oil (ISPO);Guidelines Indonesian Sustainable Palm Oil (ISPO);

Increase awareness of the importance of producing sustainable palm oil,

Improve the competitiveness of Indonesian palm oil in the world market;

pelestaraian Natural Resources and environmental

functions as well as results of the Copenhagen Meeting 2009.

ations in force in Indonesia, this mandatory must be

implemented for businesses plantations in Indonesia.

ISPO based on Indonesia regulation, law, and constitution

Obligations that must be met by sustainable palm oil development industries

includes seven principles:

1. Licensing System and Plantation Management,

2. Technical Guidelines for the Application

Palm,

3. Management and Environmental Monitoring,

4. Responsibilities to Workers,


4. Responsibilities to Workers,

5. Corporate Responsibility on Individuals

6. Community Empowerment Economic Activity,

7. Commitment to Continuous Improvement

Obligations that must be met by sustainable palm oil development industries

Licensing System and Plantation Management,

pplication of Cultivation and Processing of Oil

Management and Environmental Monitoring,

ndividuals and Communities,

Community Empowerment Economic Activity,

mprovement Economics.

1. ENERGY SECURITY:

a. Improved energy access.

b. Reducing the use of fossil

energy.

c. Reducing dependence on fuel

imports.

d. Diversifying the energy

sources.

2. ECONOMIC IMPACT

a. Job creation and enterprise

development.

b. Enhance investment in

supporting industries..

c. Enhance economic development

through local manufacture of

products and components,


sources.

e. Conserve a country’s natural

resource base.


assembly and installation,

operation and/or servicing of

equipment.

IMPACT:

Job creation and enterprise

development.

Enhance investment in

supporting industries..

Enhance economic development

through local manufacture of


3. ENVIRONMENTAL IMPACT:

a. Reduction of greenhouse gases:

– By using biodiesel and bioethanol

in transportation sector (substitute

the fossil fuel);

– By using biodiesel and biooil in

industrial sector (substitute the

fossil fuel/industrial diesel oil in

industrial sector);



assembly and installation,

operation and/or servicing of

industrial sector);

– By using biokerosene in

domestic/household use

(substitute kerosene and fuel wood

for cooking and lighting).

b. Reduction of air pollution levels.

c. Improving air quality and

enhancing the general health and

well being of local communities.

GOVERNMENT SIDE

1. Identify the detail environtment impact of biofuel

2. Threshold determination of allowable environmental

3. Development of best practice guidelines for

rules of the environment (biodiversity, water,

4. Development of Monitoring, Evaluation and

achievement of the development of biofuel


achievement of the development of biofuel

existing system (PROPER, EIA, Green Industry

5. Institutional Development System (WHO IS

BUSINESS SIDE

1. Develop technologies or systems that minimum

2. Self-assessment to ensure achievement of

environmental rules.

biofuel development;

environmental impact.

for feedstock production systems that meet the

water, air, soil, land use)� RSPO.

and Reward to ensure and encourage the

biofuel hat meet environmental rules � uses anbiofuel hat meet environmental rules � uses an

Industry Award, Certification).

DOING WHAT).

minimum environmental impact.

of the development of biofuel that comply with

Vielen Dank


www.

Directorate General of New, Renewable Energy and Energy Conservation

Jl. Pegangsaan Timur No. 1A,, Cikini, Jakarta, Phone/Fax: +62


www.ebtke.esdm.go.id

Directorate General of New, Renewable Energy and Energy Conservation

, Phone/Fax: +62-21 31924585; email: [email protected]

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