Govt asks palm oil industry to support NZE 2060

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Investor Daily - Pemerintah minta industri sawit dukung NZE 2060

30 May 2023

By: Ridho Syukra

Jakarta - The government is inviting business players in the oil palm plantation subsector to support the achievement of the Net Zero Emission (NZE) target by 2060 or earlier. Business players can give their support by changing the fuel of power plants from fossil fuel to biogas or by reducing the use of chemical fertilisers for oil palm plants.

New and Renewable Energy and Energy Conservation Director General of the Energy and Mineral Resources Ministry Dadan Kusdiana said that the government was inviting palm oil stakeholders, especially the upstream industry players, to support the NZE target achievement by 2060 or earlier. Oil palm is a subsector of the agricultural commodity industry that supports carbon emission absorption in the NZE program. “Oil palm helps with carbon emission absorption. In various literature, the plant is said to absorb more carbon than other plants,” Dadan Kusdiana said in his statement as quoted on Monday (29/5/2023).

Dadan explained that oil palms could absorb 25 tonnes of carbon dioxide (CO2) per year, while other trees can only absorb 6 tonnes of CO2 per year. Hence, oil palms absorb the same amount of CO2 as wooden plants in the forest. Based on the data from Henson (1999), during its photosynthesis process, oil palms absorb around 161 tonnes of CO2 per hectare (ha) per year. Net of CO2 from the respiration process, oil palms can absorb 64.5 tonnes of CO2 per year. “The contribution of oil palms in reducing carbon emission has been realised through the implementation of the mandatory biodiesel programme. Indonesia is currently the country that uses the most biodiesel compared to other countries, such as Malaysia,” Dadan said.

According to Dadan, the government will continue to increase the use of biofuel from palm oil in the form of biodiesel, bioethanol, or biogas. Regarding biodiesel, replacing diesel fuel with biodiesel can reduce greenhouse gas emissions by around 50-60%. Based on the study of the European Commissioning Joint Research Centre, if the biodiesel is produced by palm oil mills by using methane capture POME (palm oil mill effluent), it can reduce emissions by 62%.  “The government is currently encouraging the technology approach to convert biofuel, such as palm oil, into fuel or diesel fuel,” he explained.

Hence, in the future, bioenergy utilisation will be optimised in the form of liquid biofuel or biogas to process organic liquid waste. “Biomass in solid form can also be utilised, such as trees, bunches, and fibres that are in large quantities,” Dadan said as a keynote speaker during a virtual discussion titled “Palm Oil Industry Contribution to Net Zero Emission in Indonesia” on Wednesday (24/5/2023).

Meanwhile, IPB University Surfactant and Bioenergy Research Centre (SBRC) Director Meika Syahbana Rusli said that oil palms could absorb a significant amount of CO2 in the atmosphere. For example, following the increase in biodiesel consumption between 2016-2021, emissions decreased by 22.48% in 2020 and by 25.43% in 2021. “Compared to diesel fuel, the figure in 2021 was around 22%,” he stated. On 23 September 2022, the Indonesian government announced the Enhanced Nationally Determined Contribution (ENDC) that targets to reduce greenhouse gas emissions by 31.89% and 43.2% by 2030 to the UNFCCC.

Meanwhile, Plantation Protection Directorate Subcoordinator of the Agriculture Ministry Dwimas Suryanata Nugraha said that oil palm plantations were not the sole reason for the increase in greenhouse gas emissions. “There are many issues in our society regarding palm oil. For example, palm oil as the reason for deforestation and increased greenhouse gas emissions. In fact, oil palm plantations cannot be said as the reason for the increase in greenhouse gas emissions,” he added.

Biogas power plants

Palm oil industry players are welcoming the government’s invitation to reduce carbon emission and achieve the NZE target by 2060 or earlier. Tunas Sawa Erma (TSE) Group, a palm oil company that operates in Papua, is committed to contributing to the global effort to achieve NZE. TSE Group Director Luwy Leunufna said that his company was committed to following all regulations and provisions from the government to reduce greenhouse gas emissions. As a company engaged in the natural resources sector, TSE Group realises the importance of contributing to the global effort to achieve NZE. “TSE Group is supporting the government’s effort to achieve the NDC and is ready to collaborate towards low-carbon economic transition,” he said.

Realising this commitment, TSE Group is using the Science Based Targets initiative (SBTi) as the standard to set the NZE target. SBTi is an initiative to develop and promote scientific methodologies to set the emission target in line with the Paris Agreement. With SBTi, TSE Group will set the emission target and aspects that are required to limit global warming below 1.5 degrees Celsius. TSE Group will also prepare near-term and long-term emission targets in the next two years that include all of TSE’s operating activities and its supply chain by calculating the carbon absorption potential from lands and forests managed by the company.

TSE Group will build a biogas power plant to contribute to the reduction of greenhouse gas emissions to prevent the release of methane into the atmosphere. The power plant will have a capacity of 8 megawatts (MW) and it will be built until 2030. “We want the electricity and the gas produced to be available for locals to improve their quality of life,” Luwy said. TSE Group will also reduce the use of chemical fertilisers that produce nitrogen oxide during its production and use. TSE Group seeks to replace chemical fertilisers with organic fertilisers from empty bunches and palm oil shells.