fast-tracking bioenergy industry development in malaysia ... · development in malaysia: feedstock...
TRANSCRIPT
Fast-Tracking Bioenergy Industry
Development in Malaysia:
Feedstock Availability, Policy
Frameworks, and Future PlansFrameworks, and Future PlansDato’ Leong Kin Mun, Technical Advisor
EU-Malaysia Biomass Sustainable Production Initiative (Biomass-SP)
2nd Biomass & Pellets Update 2012
17 February 2012, Bangkok, Thailand
The Project
• A development cooperation project funded by the European Union (EU) under the SWITCH-Asia Programme, jointly promoted by the Malaysian Industry Government Group for High Technology (MIGHT), the Association of Environmental Consultants and Companies of Malaysia (AECCOM), the European Biomass Association (EUBIA),and the Danish Technological Instituteand the Danish Technological Institute
• 1 of 16 approved projects from 350 proposal from EU and Asia under SWITCH-Asia Programme
• To assist Malaysian SMEs in the biomass industry to implement sustainable production (SP) models and link them to the EU and global value chain, as well as to contribute towards global climate change mitigation effort.
Biomass resource potential
• 4.7 million ha cultivated with oil palm (13.6% of the country’s total land area)
• 421 mills operation – only 20% crude palm oil and 3% palm kernel oil and
4%
1% 1%
Biomass resource potential
Oil palm20% crude palm oil and 3% palm kernel oil and 3% palm kernel cake, 74% by-products (wet biomass)
• Wood residues aplenty –but a lot of competing uses e.g. furniture-making & particleboard
94%
Oil palm
Wood
Rice
Sugarcane
Biomass industry: Opportunities
Palm biomass Woody biomass
Palm biomass
70 mil t/year EFB, PKS, OPF, OPT,
mesocarp fibre, POME
Woody biomass
2.1 mil t/year90% of total biomass
Rice husk Municipal solid waste
Rice husk
0.575 mil t/year rice husk
production
Municipal solid waste
7.7 mil t/year MSW
Oil palm biomass in 2010
No. Biomass Amount (dry weight)
1. OPF (from pruning activity) OPF (from replanting activity)
42.21 million tonnes 3.28 million tonnes
2. OPT (~5% replanting rate) 33,299,000 trunks 17.5 million tonnes
3. From the 421 palm oil mills operating at total capacity of 97.40 million tonnes of FFB,~ Estimated EFB = 22% x 92 million tonnes
21.34 million tonnes
4. Mesocarp fibers 7.73 million tonnes
5. Palm kernel shells 4.46 million tonnes
6. POME generated from per tone of FFB is about 67%.
62 million tonnes **** (million M3)
Source: Anis Mokhtar et al (2010), Oil Palm Biomass Products and Comemrcialisation, MPOB
Palm oil industry in Malaysia – the big picture
• Palm oil plantation - 80-85% owned by private estates and government/state-owned schemes, 10-15% by independent smallholders
• Palm oil processing - 60-65% owned by private / listed / government-linked companies, government-linked companies, 35-40% owned by independent palm oil mills
• FELDA – single largest palm oil player in Malaysia; 17.7% of total planted area, and contribute up to 20% in palm oil production
Government initiatives related to biomass/green technology
• National Green Technology Policy 2009– Green technology as driver to accelerate national economy and
promote sustainable development
• 10th Malaysia Plan 2011 – 2015– Renewable Energy (RE) Act 2011 and F-i-T mechanism– 985 MW of RE by 2015 (15.5% of energy mix)
• Economic Transformation Programme (ETP)• Economic Transformation Programme (ETP)• Developing biogas facilities at palm oil mills as part of the National Key
Economic Area (NKEA)
• Renewable Energy Roadmap– RE Act implements F-i-T and RE Fund to cover the cost of the
mechanism– Establishment of dedicated Implementation Agency - SEDA
• Malaysia Biomass Initiative (MBI)– Special Purpose Vehicle for Aggregation, Consortia, etc. Will play
crucial role of long-term sole purchaser and supplier of palm waste biomass – promoted by MIGHT, Global Science Innovation Advisory Council (GSIAC), and BiotechCorp
Recent development
National Biomass Strategy 2020• Spearheaded by Agensi Inovasi Malaysia and
MIGHT• Creation of RM 30 billion GNI impact, mobilising
up to 30 million tonnes30 million tonnes of oil palm biomass, up to 30 million tonnes30 million tonnes of oil palm biomass, 60,000 new jobs by 2020
• 4 EPPs under NKEA; – Pelletisation capacity, – Oil palm biomass centre, – Biogas at palm oil mills, and – Oleo derivatives
Recent development – cont.
Year 2011/12 2012/13 2013/14
Quota 190 MW 180 MW 250 MW
50 MW solar 30 MW biogas and hydro 80 MW biomass
Renewable Energy Act and Sustainable Energy Development Authority (SEDA) Act 2011
•National Feed-in-Tariff (FiT) system, guaranteed access of RE to the grid with favourable price setting per unit of renewable electricity
50 MW solar 30 MW biogas and hydro
RM 0.28-32/kWh
80 MW biomass
RM 0.27-31/kWh
Value-adding bioenergy ventures with CDM/VCS
• CDM (Clean Development Mechanism): Indirectly supports IRR/ROI of RE development projects –reduction of carbon emissions are registered and verified as certified emission reductions (CERs) and traded for with Annex 1 parties under the Kyoto Protocol/United Nations Framework for Climate Change ConventionNations Framework for Climate Change Convention
• VCS (Voluntary Carbon Standard): focuses on GHG reduction attributes only and does not require projects to have additional environmental or social benefits. The approved carbon offsets are traded as Voluntary Carbon Units (VCUs) and represent emissions reductions of 1 metric tonne of CO2
Incentives for Biomass Industry
• BioNexus Status companies enjoy attractive tax incentives, supporting programs to venture into global market, and Bills of Guarantees provided
• Green Lane Facility under SME Corp for innovative SMEs – 2% interest rebate for approved loans and tax deduction to get 1-innoCERTdeduction to get 1-innoCERT
• Green Technology Financing Scheme for producers and users of green technology
• Pioneer Status and Investment Tax Allowance – tax exemption of 100% statutory income for 10 years for biomass utilisation in energy generation or recycling of biomass to high value-added products
Funding for biomass commercialisation
• TechnoFund (MOSTI) – a bridging fund to address the funding gap between earlier basic research and commercialisation. Up to RM 5 million (RM 40 million boost for Year 2012)
• Commercialisation of R&D Fund (MTDC) for • Commercialisation of R&D Fund (MTDC) for universities – Commercialisation of R&D output from public and private universities up to RM 500k – RM 4 million
• Business Start-Up Fund (MTDC) – to fund new startup technology-based company up to a maximum of RM 5 million
Funding for biomass commercialisation (cont.)
• Cradle Investment Programme (Cradle Fund) – funds development of prototype to facilitate commercialisation -CIP Catalyst (pre-seed fund: RM500k), CIP 500 (commercialisation fund:RM500k, 2 applications/company)
• 1-innoCERT (SME Corp) – innovation certification to • 1-innoCERT (SME Corp) – innovation certification to develop innovative SMEs; opportunities for innovation coaching programme and SME Innovation Award which offers RM1 million to the Top Most Innovative SME
• Machinery loan by OCBC (4%), Project financing (Bank Pembangunan, CIMB), Soft Loan Schemes for SMEs by Agro Bank and MIDF (4%)
Funding for biomass commercialisation (cont.)
• RM500 million Commercialization Innovation Fund to assist SMEs in commercialising research products as announced in Budget 2012
• MyCreative Venture Capital initial fund of RM200 million to increase technological innovation and creativity among the youth RM200 million to increase technological innovation and creativity among the youth (Budget 2012)
• Green Technology Financing Programme (MDV) – contract financing for green certified companies from RM250k to RM2mil
• Green global supply chain opportunities for low carbon product
Funding for biomass commercialisation (cont.)
• Life Sciences Capital Fund (VC) – specialise in early stage investments in agriculture, industrial and healthcare biotechnology
• Malaysian Debts Venture Bhd – funded a large • Malaysian Debts Venture Bhd – funded a large scale CDM InnoWorks Scheme project under Inno Integrasi that promotes integrated waste management and bio-organic fertilizer plants for adoption by palm oil mills; amounting to RM100 million
Funding for biomass commercialisation (cont.)
• Bio-Technology Venture Fund – worth US$100mil (RM317.63mil) to boost the country's biotech industry, to be administered by BiotechCorp for biotech administered by BiotechCorp for biotech companies operating in Malaysia.
Challenges in the Biomass Industry
• Aggregation / collection of biomass
• Are the wastes and residues economically viable; depends on ease of collection and whether projects can be developed near source of supply – logistic costs are major barrier
• Access to financing for commercialisation• Access to financing for commercialisation
• Funding and schemes available but approval depending on Financial Institutions decision based on the 5Cs (Credit, Collateral, Capacity, Character, Condition)
• Conversion technology
• EFB pelletisation, converting biomass to sugar and ethanol yet to be commercially proven
• Projects may fail due to pricing issue for high technology
Challenges in the Biomass Industry-2
• Uncertainties of long term biomass supply (difficult to secure long term fuel supply agreement & pricing mechanism, logistic and transportation cost
• Inconsistency of biomass fuel quality –EFB requires pre-treatment to increase efficiency
• Technical & financial issues related to grid connection for biogas – methane capture projects
Competitive use of biomass
• Survey by MPOB/KPPK in 2007 on 100 mills
Source: Malaysian Palm Oil Board & Ministry of Plantation Industries & Commodities
Benchmarking the values of biomass products
Product Raw material Feedstock Availability
Value RM/MT Resource Efficiency
(million MT/year) (1:1)
Sugar derivatives
EFB 42 1000-10000
Activated carbon
PKS 7.3 3000-14000 10% from wet EFB
Pulp EFB 42 1500-2000 0.78
Fiber mat EFB 42 3-12/m2
Animal feed OPF 65 425 1.5:1
Particle boards OPT 34 600/m2
1.5:1
Compost/ fertiliser
EFB + POME 42.0 + 45 1600 (vermicompost)
100% EFB
900
Pellets EFB 42 300-400 15:1
Briquette EFB + PKS 42.0+7.3 185-215 3:1 (70% EFB, 30% PKS)
POFF EFB 42 67 2:1
Source: Compiled by Biomass-SP from MPOB, MARDI, Biotechcorp, etc.
The way forward
Energy
Agriculture
Eco-products
Pulp and paper
Biochemical
Biosugar
Lactic acid
Polylactic acid
Value
Energy
Biofuels
Biomass power plant
Biogas
Pellets, briquettes
CDM fuel-switching project
Biofertiliser
Animal feed
Composting
Pulp and paper
Biocomposite
Biopackaging
Polylactic acid
Food additives
Zeolite & catalyst
Time
EU-Asia Biomass Best Practices and
Business Partnering Conference 2012
• 7-10 May 2012 at Putra World Trade Centre (PWTC)
• Invited 100 regional speakers
• Areas of focus: biomass as energy, biomass as high value chemicals, and biomass as eco-products
• Business Matching Event• Business Matching Event
• Participation from more than 300 biomass stakeholders during the official launching!
• Serious EU biomass companies (investors, buyers, technology providers etc) looking for business collaboration with Malaysia will be granted Travel Incentive EUR 800 (travel from Europe to Malaysia)
Import/Export
Proprietary ConsultancyJoint Venture
Joint Production
Project Financing
Carbon Credit Trading
Types of potential collaboration
Joint Production
Contract Research
Joint R&D
Technology Licensing
Technology Transfer
Carbon Credit Trading
Distributorship/Marketing Services
Venture Capital
CDM Development
Green Procurement
Potential areas of collaboration
� Buyers meet Sellers
� Consultants meet Clients
� Entrepreneurs meet Venture Capitalists
� Exporters meet Importers
� Researchers meet Marketers
� Researchers meet Researchers
� SMEs meet Multi-� Exporters meet Importers
� Foreign Investors meet Government Officers
� Investors meet Marketers
� Vendors meet Procurement Officers, etc.
� SMEs meet Multi-National Companies
� SMEs meet SMEs
� Suppliers meet Distributors
� Traders meet Manufacturers
Potential areas of collaboration - 2
• Italian buyer look for bio-composite products made of rice husk• Dutch and Italian buyers search for palm biomass pellets and
wood pellets• EU investor interested to invest in wood pellets production plant• EU utility company interested to invest in biomass power plant• French company is interested to invest in methane capture biogas
projects projects • EU carbon brokerage companies are searching for carbon
financing deals. • EU companies interested to buy palm kernel shell (PKS)
Potential areas of collaboration - 3
• EU carbon credit compliance buyer interested to buy carbon credits
• Dutch buyers are looking for biomass briquettes• Bio-ethanol production business proposal from EU
company based in Asia• Torrefaction technologies provider for wood pellets • Torrefaction technologies provider for wood pellets
from Netherlands are looking for collaboration in Malaysia
• Enquiries of palm-based biochemicals• Potential R&D projects collaboration on bio-fertilisers,
energy pellets, bio-chemicals, waste-to-wealth, etc.• Investment proposal for Jatropha projects
Business Match-Making Scenarios
Scenario 1• XYZ Science & Technology Institute, a research and
development (R&D) institute based in Europe, entered a joint R&D collaboration worth €5 million with a local SME to set-up a pilot project for ethanol production from palm biomass in Malaysia. production from palm biomass in Malaysia.
Scenario 2• Biocharcoal Sdn. Bhd. entered an agreement with
an Italian company to supply PKS to their biomass power plant worth 20,000-22,000 tonnes per shipment
Business Match-Making Scenarios - 2
Scenario 3
• ABC Bioenergy Trade, a Danish bioenergy trading company interested to buy briquettes from local SMEs in Malaysia.
Scenario 4
• PDF Energy, an EU utility company interested to invest in a 10 – 30 MW biomass power plant project in Malaysia.
Palm oil & rice millers
Solid biofuel manufacturersBiomass collectors & transporters
Biomass & biomass products traders
Commercialisaton entrepreneurs
Biogas technology providers
Wood-based biomass producers
Biocomposite producers
Biofertiliser producers
Eco-friendly produces & green building materials
Biomass power plant developers
Biochemical technology producers
Carbon credit brokerage companies & carbon fund managers
Certification companies
Biochemical producers
Renewable energy technology providers
Venture capital companies and financial institutions
CDM project developers/investors
Logistic/freight forwarders companiesEquipment, machinery and lab
facility providers
For further information
Serious EU biomass buyers/traders/technology providers/investors may consult Biomass-SP as your focal
point to trade biomass in Malaysia: EFB, pellets, PKS, woodchips, biocharcoal, briquettes, investments in
biomass power plants, etc.
For further information
T: 603-88848882
F: 603-88848838
www.biomass-sp.net