Biodiesel plant - Biodiesel plant - Jatropha Jatropha curcascurcas feedstock in Sumbawa feedstock in Sumbawa

Case StudyCase Study

DEPOT TEKNOLOGI KHAULA “Serving rural market for better productivity and livelihood”

ERLANGGA RISMANTOJO

Biofuels as location spesific solutions >> local Biofuels as location spesific solutions >> local captive market >> small/medium scale industriescaptive market >> small/medium scale industries

Depot Teknologi Khaula - Depot Teknologi Khaula - Denkha Denkha Khaula Karya FoundationKhaula Karya Foundation

A business initiative, distributes A business initiative, distributes Renewable energy technologiesRenewable energy technologies Appropriate technology solutions.Appropriate technology solutions.

Products include Products include Biogas digesters, Biogas digesters, Rice husk gasifiersRice husk gasifiers Biofuel!Biofuel!

Biodiesel in IndonesiaBiodiesel in Indonesia

2005; National programme for biodiesel from 2005; National programme for biodiesel from Jatropha curcasJatropha curcas feedstock feedstock

Production initiation by palm oil feedstock, Production initiation by palm oil feedstock, Jatropha Jatropha not readynot ready

Price unable to compete with subsidized fossil Price unable to compete with subsidized fossil fuelfuel

Side effectsSide effectsBooming of Jatropha seedling salesBooming of Jatropha seedling sales

Needs Market guarantee instuments Needs Market guarantee instuments (1) Insentive mechanism, (2) Regulation, (3) Special (1) Insentive mechanism, (2) Regulation, (3) Special loan programme, etcloan programme, etc

Why Why Jatropha curcasJatropha curcas

Non edible - Not conflicting with food Non edible - Not conflicting with food Decentralized solutions for remote areasDecentralized solutions for remote areas Inter-cropping to increase land productivityInter-cropping to increase land productivity Potential reduction of diesel fuel import which is Potential reduction of diesel fuel import which is

now now 10.85 mio kL/year10.85 mio kL/year Optimize use of marginal land Optimize use of marginal land 13 mio ha13 mio ha Potential Jatropha biodiesel production Potential Jatropha biodiesel production

28 mio kL/year28 mio kL/year

Indonesia Biodiesel PlantsIndonesia Biodiesel Plants

PTPN 4 & GANESHA ENERGI Medan4,000 tpy (CPO)

BPPTSerpong300,000 tpy (CPO)

RAPBintaro1,650 tpy (CPO)

EAIJakarta500 ton/year (CPO)

WILMAR GROUPDumai350,000 tpy (CPO)

SUMIASIHBekasi40,000 tpy (CPO)

DHARMA

4,000 tpy (CPO)

PT. INDO BIOFUEL ENERGI

20,000 tpy (CPO)

CPO PRICE SPIKE 2006 : US$ 300/ton

2008 : US$ 1,200/ton

PT . Industri Tanaman Energi Sumbawa

500 tpy (CJO)

ETHERINDOGresik120,000 tpy (CPO)

Jatropha based biodiesel production potential Jatropha based biodiesel production potential area (compiled from various media in Indonesia)area (compiled from various media in Indonesia)

SINARMASDumai400,000 kl/year

PERTAMINADumai, Balongan, Balikpapan500,000 kl/year

INDOMAL + PTPNMedan, Banten, Pekanbaru1,500,000 kl/year

TOLARAMW. Kalimantan110,000 ha

ASIATIC GROUPWest Kalimantan80,000 ha

CLEAN BIOFUELGorontalo50,000 ha

BUMN AGRORiau, Jambi, Sumsel, Kalimantan, Papua220,000 ha (core)880,000 ha (plasma)

MUTING GROUPMerauke290,000 ha

BAKRIE, INDOFOOD, ASIANAGRO, SUMIASIHSumatra, Jawa600,000 kl/year

PT. INDO BIOFUELS ENERGYMerak160,000 kl/year

LEMIGASJawa3,000 ton/year

INDOMALSula, Merauke300,000 ha

SINARMASW. Kal, Merauke440,000 ha

9 BADAN USAHAMerauke340,000 ha

APROBI GROUPKalimantan100,000 ha

BPNTT, Papua, Kalimantan100,000 ha

SWEDEN BIOENERGYNTT350,000 kl/year100,000 ha

GENTING GROUPMerauke400,000 ha

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Case Study : Jatropha based Case Study : Jatropha based Biodiesel plant in Alas, Biodiesel plant in Alas,

SumbawaSumbawa Initiated in 2002Initiated in 2002 Current Current JatrophaJatropha plantation 500 ha plantation 500 ha Plan to expand extra 3,000 ha with community Plan to expand extra 3,000 ha with community

participationparticipation Input - Jatropha seeds 6 ton/dayInput - Jatropha seeds 6 ton/day Current production 600 L/day, with production Current production 600 L/day, with production

capacity 1,500 L/daycapacity 1,500 L/day Target market of 2,000 fishermen & BTSTarget market of 2,000 fishermen & BTS Invested US$ 28,000 Invested US$ 28,000 Plantation investment US$ 390,000Plantation investment US$ 390,000

Sumbawa Market AnalysisSumbawa Market Analysis

Official petro-diesel retail price on location Official petro-diesel retail price on location for industry Rp 8,000/L (US$ 0.9) and for for industry Rp 8,000/L (US$ 0.9) and for transportation Rp 5,500/L (US$ 0.6)transportation Rp 5,500/L (US$ 0.6)

Petro-diesel availability problem, Petro-diesel availability problem, uncertainty in supplyuncertainty in supply

Due to remote location, real retail price Due to remote location, real retail price could spike up to Rp 20,000/L (US$ 2.2)could spike up to Rp 20,000/L (US$ 2.2)

Business modelBusiness model

Overall ProductOverall Product

Community InvolvementCommunity InvolvementScheme BScheme A

Assumption :

- 5 ton seed/ha/year

- Seed price US$ 0.09 /kg

- CJO price US$ 0.4 /L

- Kerosene price US$ 0.4 /liter

435

Annual revenue (USD) per ha Scheme

BScheme

ASource

Seed

CJO

Biogas

- 435

476

285

-

-

Total 761

Plant ProgressPlant Progress

Plantation during rainy season Plantation during dry season

Plant in University (ITB)-Bandung Biodiesel purifying in ITB

Plant Progress (Cont’d)Plant Progress (Cont’d)

Biodiesel finished product Jatropha cake for biogas prod.

Jatropha biogas digester ver.1 Jatropha biogas digester ver.2

IndonesiaIndonesiaBandung Alas, Sumbawa

Bali, West Nusa TenggaraBali, West Nusa Tenggara

Alas, Sumbawa

Lombok IslandLombok IslandAlas, Sumbawa

Plant location

Fishermen island I

Fishermen island II

Plant LocationPlant Location

10 hectare Jatropha plantation privately owned

Fishermen IslandsFishermen Islands

Potential plantation areaPotential plantation area

3,000 ha

Existing Jatropha plants

Local community

Plant location

Current Captive MarketCurrent Captive Market

BTS locationPlant location

BTS location

BTS location

Feasibility of biodiesel plantFeasibility of biodiesel plantAssumptionAssumption Current captive Market Current captive Market : Base Transceiver Station (BTS) : Base Transceiver Station (BTS) Jatropha seed Jatropha seed : US$ 0.1 /kg: US$ 0.1 /kg Input JatrophaInput Jatropha : 6,000 kg/day: 6,000 kg/day Sales of biodiesel Sales of biodiesel : US$ 82/L : US$ 82/L Total production cost Total production cost

Direct MaterialDirect Material : US$ 327,310/year: US$ 327,310/year Direct LaborDirect Labor : US$ 6,348/year: US$ 6,348/year Factory overhead Factory overhead : US$ 31,660/year: US$ 31,660/year Maintenance Maintenance : US$ 2,174/year: US$ 2,174/year

Discounted rateDiscounted rate : 12%: 12% Annual cost escalation rateAnnual cost escalation rate : 10%: 10% Total plant investment Total plant investment : US$ 55,000: US$ 55,000 Payback periodPayback period : 7 months: 7 months IRR 5 yearsIRR 5 years : 153%: 153% NPV 5 yearsNPV 5 years : US$ 285,270: US$ 285,270

IMPACTIMPACTEnvironment Social

Economic

1,467 ton CO1,467 ton CO22-eq reduced -eq reduced annually (biodiesel)annually (biodiesel)

Future revenue for plantation US$ 652,000/year Future revenue for plantation US$ 652,000/year

Future employment of 6,000 Future employment of 6,000 people (on farm & off farm)people (on farm & off farm)

Marginal land to be planted 3,000 haMarginal land to be planted 3,000 ha

Establishment of SMEs in Establishment of SMEs in manufacturingmanufacturing

National subsidy reduced US$ 540,000/yearNational subsidy reduced US$ 540,000/year

Fuel supply guarantee for 1,000 Fuel supply guarantee for 1,000 fishermenfishermen

Possible VER sales US$ 33,600/yearPossible VER sales US$ 33,600/year

Plant revenue US$ 450,000/yearPlant revenue US$ 450,000/year

1,900 ton CO1,900 ton CO22-eq reduced -eq reduced annually (biogas)annually (biogas)

766.5 ton organic fertilizer 766.5 ton organic fertilizer produced & usedproduced & used

Next StepsNext Steps

Market development (local market)Market development (local market) Financing production up scaling to 15,000 Financing production up scaling to 15,000

L/dayL/day VER (Verified Emission Reduction) SalesVER (Verified Emission Reduction) Sales Financing to expand community based Financing to expand community based

Jatropha plantationJatropha plantation

Thank youThank you

DEPOT TEKNOLOGI KHAULA “Serving rural market for better productivity and livelihood”

Erlangga Rismantojo

Depot Teknologi Khaula – Khaula Karya

Jl. Kemang Utara A-3

erlangga@khaula.org

Phone +62-21-7182283