Unblocking bioenergy a huge challenge for Indonesia
Unclear policies and weak markets are stopping bioenergy supply meeting its target but focusing on local demand might be the doorway to success.
‘In terms of technology, bioenergy can be developed almost anywhere in Indonesia’, said Ingrid Öborn, Southeast Asia regional coordinator of ICRAF The World Agroforestry Centre, at a bioenergy seminar supported by the Government of Sweden in Jakarta on 15 February 2017. ‘The bottleneck is not about the technology now. The policy and the market are not sufficient and stakeholders are not fully committed so the enabling environment to develop bioenergy doesn’t yet exist’.
Within this context, Sonya Dewi, ICRAF’s Indonesia coordinator, stressed that bioenergy should be seen as part of an integral part of ‘green’ or sustainable growth applied in each district of the nation’s provinces. Under the Indonesian system, substantial authority is devolved to provincial and district governments. Hence, translating national policies and targets into local contexts is not merely an interesting exercise but rather a fundamental.
‘Bioenergy has good potential but its return on investment is still low so strategic policies and subsidies are necessary’, she said at a linked seminar held the day before in Bogor. ‘But much can be done already at provincial level. For example, we worked together with the Government of South Sumatra Province to create a green-growth plan up to 2030. Among other things, this master plan maps all villages without access to the main electricity grid that can potentially become self-sufficient in electricity through bioenergy. Information is available on the size of their populations, what land is available, and what bioenergy feedstock and production types are suitable. If on-site energy production can be developed, not only will villages enjoy energy self-sufficiency but also their livelihoods and economies will be boosted. The multiplier effects will contribute to gross domestic product’.
Self-sufficiency could be achieved using various types of locally-available feedstock, such as ‘nyamplung’ (Calophyllum inophillum), elephant grass (Pennisetum purpureum Schum), bamboo, sago, nipa or rice straw. However, she warned that developing bioenergy by converting forests and other land with high carbon stock would increase greenhouse-gas emissions and defeat the purpose of bioenergy to reduce emissions. Comprehensive planning was needed to ensure that over-enthusiasm to meet targets did not end up being self-defeating.
‘The South Sumatran master plan has already considered this issue and foresees a 22% reduction in greenhouse-gas emissions’, she said.
This kind of figure is well on track to help the nation meet its commitments made under various international agreements, including the recent Paris Agreement. The Government of Indonesia is targeting a unilateral 29% reduction in emissions, or 41% with international help, by 2030.
Henry Bastaman, director-general of Indonesia’s Forestry and Environmental Research, Development and Innovation Agency, Ministry of Environment and Forestry said that the Government is working hard to find ways to keep temperatures below the 1.5–2 °C predicted increase. For a nation of around 250 million people straddling the equator, this ambition is more than just altruism but critical for long-term survival.
Mandated in Government Regulation No. 79/2014, renewable energy, especially bioenergy, is a key pillar of national energy policy. However, to date only 5% renewable energy makes up the national mix, falling far short of the targeted 23% to be met in the next 9 years. While the policy directive is admirable, as Öborn and Dewi observed, achieving it on the ground is proving difficult thanks to authority for implementation spread across 34 provinces with varying levels of capacity and a skewed market that still provides substantial support for fossil fuels.
Sudjoko Harsono Adi, director of bioenergy at the Ministry of Energy and Mineral Resources, said that, ‘There are five things the government is focusing on to encourage the bioenergy sector, namely, regulating an increase in the installed capacity of electricity production, accelerating access to modern supplies of energy for rural and remote communities, reducing subsidies both for electricity and fuel, reducing greenhouse-gas emissions, and implementing energy-saving programs’.
While applauding the government’s ambitions, speakers at both seminars pointed out the difficulties involved in not only dealing with provincial and district governments whose understanding of the sector was limited but also obtaining plentiful, cost-effective and environmentally-friendly feedstock as well as satisfactory market access.
In spite of research showing good potential for certain crops, the amount of feedstock for many is limited. It could be possible to use degraded or marginal land for biomass production to reduce pressure on arable land and natural forests although trade-offs with ecosystem services had to be carefully evaluated. Agroforestry was possibly an excellent solution by integrating biomass production within agroforestry systems for energy, food and environmental benefits. Research on this is already underway but profitable business models are still lacking that encourage small- and medium-sized enterprises and investors to act.
‘There has been a lot of research on bioenergy in Indonesia but yet there are still only pilot projects. They need to be expanded’, explained Adhi Wibowo, representing the head of research and development at the Ministry of Energy and Mineral Resources.
Speakers at both seminars called on the government to better fund long-term research and development efforts—specifically through creation of a bioenergy development fund with an accompanying research consortium—and to facilitate an integrated approach by the many different research agencies, including the Ministry of Agriculture, private developers and regional governments. Research would then be long-term, focus on producing knowledge and technologies relevant to industry for wider use, and foster a national industry for the research and development of bioenergy, including producing equipment and material, such as enzymes and filters. It was also essential that uptake of bioenergy research and development was built into regional plans, with accompanying capacity development.
Other financial instruments proposed at the seminars included low-interest loans and subsidies. Incentives were considered critical for development, whether from government to producers or through mechanisms where all involved benefited in the broader sense, such as where a community sells bamboo to a larger company which produces electricity from it that is supplied to the National Electricity Company.
A further series of workshops was urgently needed with the involvement of all key partners to develop a bioenergy roadmap that was realistic, measurable and strategic.
The two seminars were, first, Developing Science- and Evidence-Based Policy and Practice of Bioenergy in Indonesia within the Context of Sustainable Development, held Tuesday, 14 February 2017 at the campus of ICRAF and the Center for International Forestry Research in Bogor, Indonesia, organized by the two organizations in collaboration with the Research and Development Agency, Ministry of Energy and Mineral Resources; Forestry and Environmental Research, Development and Innovation Agency, Ministry of Environment and Forestry; and the Royal Institute of Technology, Stockholm, Sweden; with sponsorship by the Swedish Energy Agency. The second seminar, Roundtable Discussion on Bioenergy Research and Development in Indonesia, was held 15 February 2017 in Jakarta, hosted by the Swedish Energy Agency and the Embassy of Sweden in Jakarta.
Read more bioenergy stories from Indonesia
This work is linked to the CGIAR Research Program on Forests, Trees and Agroforestry. ICRAF The World Agroforestry Centre is one of the 15 members of the CGIAR, a global partnership for a food-secure future. We would like to thank all donors who support research in development through their contributions to the CGIAR Fund.