Slow-Release Fertilizer: A New Trend in the Palm Oil Industry

Fertilizer is crucial for plant growth, especially for palm oils. Palm oil trees won't even bear fruit without fertilization. Fertilization is the highest cost component of palm oil plantation operations. Fertilizer efficiency is clearly a key consideration. This is why innovation in palm oil fertilization is rapidly developing.

Regarding innovations to increase fertilizer efficiency in palm oil plantations, the concept of slow-release fertilizer (SRF), or controlled-release fertilizer (CRF), is gaining increasing attention. By engineering the slow or controlled release of nutrients, the plant's nutrient use efficiency (NUE) increases. Fertilizer becomes more economical and environmental pollution is reduced. Indonesia's tropical climate, with its high rainfall, also results in high fertilizer leaching.

Several materials have been developed as SRF/CRF agents to achieve the desired nutrient release levels. These include polymers, sulfur, chemical compounds, and even compost. The characteristics of SRF/CRF agents vary depending on the material and product type. In addition to performance, the price of the SRF/CRF agent is also an important consideration.

Biochar is a renewable SRF/CRF agent and a climate solution. Biochar can persist for hundreds of years in the soil as a carbon sequestration. In addition to synthetic materials derived from non-renewable sources, biochar is an alternative SRF/CRF agent derived from renewable sources. Biomass from agricultural, plantation, and forestry waste is the main source of biochar production through the pyrolysis process. A number of SRF/CRFs with slow-release biochar agents have also begun production. This will increase biochar production, which has so far been less popular. It will also provide a solution to the biomass waste problem and be economically valuable. 

Slowing Palm Oil Land Expansion: Replanting or Biochar ?

The reckless expansion of palm oi plantations is definitely offside sustainability. Instead of palm oil being a blessing due to their highest productivity among other vegetable oil sources (soybeans, sunflowers, rapeseed, coconuts, etc.), growing only in tropical regions and contributing 40% of the global vegetable oil supply, they have instead become a natural disaster. The cost of this disaster is no small matter, costing thousands of lives, in addition to other material losses. This issue was particularly highlighted during the recent floods in Sumatra. Are the profits from palm oil worth the loss of life?

Clearing tens or even hundreds of thousands of hectares of oil palm plantations produces valuable timber. It's even possible to generate substantial profits from land clearing alone, even though palm oil plantations and production haven't even begun. This is what drives entrepreneurs to flock to this plantation sector, driven by the sole goal of maximizing profits without considering their own needs, resulting in widespread disasters. Furthermore, the implementation of mandatory B-40 or even B-50 biodiesel, currently being discussed, will undoubtedly create a new market for palm oil/CPO, much easier and more flexible than exporting to Europe, which is subject to the European Union Deforestation Regulation (EUDR), or to the US, which faces high tariffs.

Moreover, it has already been established that palm oil/CPO consumption for biodiesel has exceeded food demand. The mandatory implementation of the B-50 program also requires a 20% increase in CPO production capacity, or 60 million tons per year. The most profitable and fastest way to do this is through extensive deforestation, as the timber from cleared forests can be sold directly.

When the goal is to increase palm oil production gradually, safely, in a planned, and sustainable manner, adequate consideration is required, not blindly and recklessly clearing forest areas (deforestation) under the guise of land conversion. Besides the use of superior seeds, there are at least two ways to increase palm oil productivity: replanting and biochar application (part of land intensification).

According to Joko Supriyono, former chairman of GAPKI (Indonesian Palm Oil Producers Association) for the 2015-2018 and 2018-2023 periods, in his book "Is Indonesian Palm Oil Still Successful?", it is stated that if replanting of palm oil in Indonesia successfully reaches 300 thousand hectares per year, it is estimated that CPO and CPKO production in 2045 will reach 80 million tons. While currently CPO and CPKO production is around 55 million tons. And with the use of biochar, palm oil productivity will increase by an average of 30% in 5-10 years, meaning that by 2035 CPO and CPKO production will reach 71.5 million tons. Moreover, if the two methods are combined, the results should be even better.

Indonesia's current CPO production reaches approximately 50 million tons/year, covering a land area of ​​16.8 million hectares with an average CPO production of 3.55 tons/ha per hectare, or 3.55 million tons per million hectares. If biochar is used and productivity increases by 30%, this means an increase of 15 million tons of CPO (a total of 65 million tons of CPO/year) and this saves approximately 4.2 million hectares of land, or the use of biochar will slow down forest clearing for palm oil plantations. The application of biochar with compost will improve the quality of the compost to become premium compost. For more details, read here. This allows the palm oil industry to operate by utilizing all its biomass waste.

The replanting movement of palm oil plantations must be encouraged to continuously increase palm oil production. The problem of biomass waste from palm oil trees, which cover thousands of hectares, also poses a challenge. With such a large volume of old palm oil trees, utilizing them for value-added products is crucial. With an average hectare of palm oil plantations consisting of 125 trees, each tree having an average dry weight of 0.4 tons, this yields 50 tons of dry weight of biomass per hectare. For an area of ​​10,000 hectares, this yields 0.5 million tons of dry weight, and for an area of ​​100,000 hectares, this translates to 5 million tons of dry weight. An optimistic estimate suggests that Indonesia could achieve 5% replanting (very optimistic) or 820,000 hectares, which would yield 41 million tons of dry weight of biomass per year. Similarly, Malaysia, with 5% replanting or 285,000 hectares, would produce 14.25 million tons of dry weight per year.

Business readiness factors, both technologically and in terms of the market or user base, need to be carefully assessed. With such a large volume, biomass processing plants or industries can be established and operate optimally without worrying about raw material shortages. Products such as pellets, briquettes, biochar, and other bioproducts, such as other biocarbons, biomaterials, biofuels, and biochemicals, are also possible from this old palm oil trunk biomass waste. Old, dead oil palm trunks, often left unattended on land, should be utilized to produce these useful, value-added products. For more details on utilizing trunk waste for fuel pellet production (OPT Pellets), please read here. 

OPT Pellets for Biomass Power Plants and BECCS in Japan and Europe

As a tropical region known for biomass heaven, there are numerous sources that can be utilized for biomass pellet production, particularly OPT pellets or oil palm trunk pellets. This potential is certainly in line with global decarbonization efforts to save the earth from climate change and global warming. Indonesia is currently the world's largest palm oil producer, with approximately 17 million hectares of palm oil plantations. Of this area, 9 million hectares are managed by private companies, 550,000 hectares are owned by state-owned companies (PTPN), 6.1 million hectares are owned by smallholders, and the remainder remains unverified. Crude palm oil or CPO productivity has stagnated over the past five years due to the slow pace of replanting, which is around 45 million tons per year. Therefore, replanting, especially for smallholders, must be encouraged.

Most palm oil companies affiliated with GAPKI have conducted replanting periodically or once a year with an area of ​​4-5%. The palm oil companies that are members of GAPKI are 731, while according to BPS 2023 the number of palm oil companies in Indonesia reached 2,446 companies, spread across 26 provinces. Meanwhile, in smallholder palm oil plantations, replanting is very small, namely in 2024 alone with a target of 180,000 hectares (around 3% of smallholder palm oil plantations) but the realization is less than 40,000 hectares (0.7% of smallholder palm oil plantations) and even because it is so far from the target set in 2025 the government's target for replanting smallholder palm oil plantations was reduced to only 120,000 hectares (around 2% of smallholder palm oil plantations).

With an average of 125 trees per hectare of palm oil plantation, each tree yielding an average dry weight of 0.4 tons, this yields 50 tons of dry biomass per hectare. For an area of ​​10,000 hectares, this translates to 0.5 million tons of dry biomass, and for an area of ​​100,000 hectares, this translates to 5 million tons of dry biomass. Optimistically, Indonesia could achieve 5% replanting, or 820,000 hectares, which would yield 41 million tons of dry biomass per year. Malaysia, with 5% replanting, or 285,000 hectares, would produce 14.25 million tons of dry biomass per year.

For a more practical calculation, let's consider the average palm oil company group in Indonesia with five palm oil mills and 50,000 hectares of palm oil plantations. With annual replanting of 5% of the total plantations, 2,500 hectares are replanted annually. This replanting will produce 125,000 tons of dried oil palm trunks. This volume will then be used to produce oil palm trunk pellets, or OPT pellets, assuming 3% loss during the production process. This yields 121,250 tons of OPT pellets per year.

Using a Handymax vessel with a capacity of 25,000 tons per shipment, five shipments are required, or using a Panamax vessel with a capacity of 50,000 tons per shipment requires two shipments plus one Handymax vessel. Alternatively, using a vessel with a capacity of 10,000 tons per shipment requires approximately 12 shipments per year. Shipments with large capacity handymax and panamax vessels are suitable for the European market, while smaller vessels, namely 10,000 tons/shipment, are suitable for the Japanese market.

Japan, with around 290 biomass power plants, should technically be able to move towards BECCS more quickly, but it's just a matter of policy and regulation. Installing CCS (Carbon Capture and Storage) units in biomass power plants makes the plant's operation carbon negative, or carbon (dioxide) removal (CDR) or Greenhouse Gas Removals (GGR). Furthermore, Europe has a successful example of BECCS implementation, namely the Stockholm Exergi BECCS project. This Stockholm project, based on sustainable biomass fuel, has secured one of the world's largest carbon sequestration agreements with Microsoft.

Furthermore, policy support for biomass power plants with CCS/BECCS or those capable of CDR/GGR is also increasing, as in the UK. This includes the indefinite extension of support for biomass power plants to allow time for plants to transition to BECCS. Modifications and retrofitting of existing power plants will eliminate millions of tons of CO2 annually while still generating electricity from renewable sources. This potential can only be maximized with government support for the transition to BECCS.

Replanting Palm Oil Plantations and Utilizing Old Palm Oil Trunks Waste (Presentation Version)

Aging plants are one factor in declining palm oil productivity. Palm oil trees begin to decline in productivity after 20 years and need to be replaced after 25 years. Therefore, rejuvenation or replanting must be carried out periodically according to the age of the trees.

Furthermore, the demand for palm oil continues to grow in line with global population growth. For the domestic market, biofuel use takes the form of a mandatory 40% palm oil blend in biodiesel (B40) this year, which is being reviewed to increase to 50% (B50) by 2026, and a 3% blend for jet fuel by 2026. Demand for the international market also continues to grow. The main destinations for Indonesian palm oil are India, China, Pakistan, Bangladesh, the United States, the Netherlands, Spain, Italy, Egypt, and South Africa.

Replanting palm oil plantations is crucial because it maintains sustainable palm oil productivity and prevents or reduces deforestation for new lands. The potential volume of old palm oil trunk waste generated is enormous, and there are numerous utilization options, including bioenergy, biocarbon, biomaterials, biofuels, and biochemicals.

To read and access the presentation, please download here. 

Palm Oil Replanting Movement and Utilization of Biomass Waste

Palm oil trees begin to lose productivity after 20 years and need to be replaced after 25 years, while new trees take about four years to begin bearing fruit. This generally renders the land unproductive during this four-year period, which discourages farmers from replanting their palm oil. However, intercropping during this period can still provide benefits for farmers. Planting short-term crops like upland rice and corn alongside palm oils can help farmers earn additional income while the palm oils bear fruit and mature.

In 2024, Malaysia, the world's second-largest palm oil producer, began implementing land intensification due to limited land area, only replanting 2%, or approximately 114,000 hectares. This is despite the country's target of replanting 5% of its land. The situation in Indonesia is not much different, with replanting predicted to be less than 2%. For example, if only 1.5%, or approximately 246,000 hectares, are replanted, it would be disproportionate to the area of ​​its oil palm plantations, which is nearly three times Malaysia's. Furthermore, replanting should be carried out periodically every year to achieve optimal palm oil production performance.

The reluctance or slow pace of replanting has led to a decline in national crude palm oil (CPO) production. Malaysian palm oil production has even stagnated for more than a decade due to limited land for new plantations and slow replanting. Meanwhile, in Indonesia, concerns about deforestation have also impacted the expansion of new oil palm plantations. Crude palm oil (CPO) production will decline further if labor shortages and the spread of ganoderma fungus reduce yields.

Given the above conditions, the replanting of palm oil plantations must be encouraged to maintain or even increase palm oil production. The issue of biomass waste from palm oil trees, which cover thousands of hectares, also poses a challenge. With such a large volume of old palm oil trees, utilizing them for value-added products is crucial. With an average hectare of palm oil plantations containing 125 trees, each tree yielding an average dry weight of 2 tons, this yields 250 tons of dry weight of biomass per hectare. For 10,000 hectares, this yields 2.5 million tons of dry weight, and for 100,000 hectares, this yields 25 million tons of dry weight. An optimistic estimate would be that Indonesia could replant 5% of its land, or 820,000 hectares, for 205 million tons of dry weight of biomass. Similarly, Malaysia, with 5% replanting, or 285,000 hectares, would yield 71.25 million tons of dry weight.

Business readiness factors, both in terms of technology and the market or user base for the product, need to be carefully assessed. With such a large volume, biomass processing plants or industries can be established and operate optimally without worrying about raw material shortages. Products such as pellets, briquettes, and biochar are made from waste biomass from old palm oil trunks. Dead old palm oil trunks, often left abandoned on land, should be utilized to produce these useful, value-added products.

Biochar for Sustainable Palm Oil Productivity

The Indonesian government emphasized the importance of sustainable palm oil productivity for food and energy security, as conveyed by Deputy Minister of Agriculture Sudaryono, at the opening of ICOPE (International Conference on Palm Oil and Environment) in Sanur, Bali, mid-February 2025. The conference, attended by delegates from various countries, namely Indonesia, Malaysia, India, the Netherlands, France, Finland, Colombia, and Spain, aims to formulate a sustainable transformation for the palm oil industry. Sustainable palm oil productivity can be increased by land intensification and the use of superior seeds. Even if land expansion is necessary, it must be done without causing deforestation. Meanwhile, for replanting in dry land, it can also be combined with upland rice or corn through intercropping methods.

Biochar is a powerful solution
Palm oil productivity can be increased by improving fertilizer efficiency, or Nutrient Use Efficiency (NUE), as part of land intensification. Using the same fertilizer dose with the addition of biochar will increase palm oil productivity by around 20% or more. Fertilizer savings of around 30% with the addition of biochar will keep palm oil productivity relatively stable or at the same level as before. For efforts to increase palm oil productivity while avoiding deforestation, the first option is more appropriate: maintaining the same fertilizer dose as usual, but adding biochar to increase fertilizer efficiency.  

Indonesia's current CPO production reaches approximately 50 million tons/year across 16.4 million hectares, with an average CPO production of 3.55 tons/ha per hectare, or 3.55 million tons per million hectares. If biochar is used and productivity increases by 20%, this means an increase of 10 million tons of CPO per year (a total of 60 million tons of CPO per year), saving approximately 2.8 million hectares of land. The use of biochar will also slow down forest clearing (deforestation) for palm oil plantations.

Besides using biochar to increase palm oil productivity, other benefits from biochar production include the potential for carbon credits (BCR = biochar carbon removal) and the utilization of pyrolysis byproducts for palm oil plantations and palm oil mill operations in CPO production. This method offers several advantages for palm oil companies, such as savings in liquid organic fertilizer and pesticides, and the sale or export of 100% of the palm kernel shells (PKS). In addition to palm oil companies producing their own biochar through pyrolysis, it is also possible to establish separate companies or companies that collaborate with palm oil companies for biochar production under specific agreements.

Global pressure and scrutiny on the palm oil industry to adopt sustainable practices are increasing. Amidst soaring demand for palm oil in both global and domestic markets, increasing palm oil productivity is inevitable. Utilizing biomass waste from palm oil mills and plantations, such as empty fruit bunches (EFB) and trunks (OPT), for biochar production, and using biochar to increase palm oil productivity, is a powerful solution to address these challenges. Even for replanting dryland with upland rice or corn using intercropping methods, the use of biochar will also have a positive and significant impact on these intercrops. 

Biochar for Palm Oil Nurseries Part 2

In 2024, Malaysia reported that replanting their palm oil plantations reached 114,000 hectares, or 2% of the country's total area, compared to the targeted 4% to 5%. Indonesia's replanting rate is estimated to be lower, but because Indonesia's palm oil plantations are much larger, approximately three times Malaysia's, the area is larger. This situation has led to a decline in palm oil production, as palm oil productivity begins to decline after 20 years and requires replacement or replanting after 25 years to maintain productivity. Replanting should be carried out periodically, with an area of approximately 5% of the total palm oil plantation area.

Palm oil rejuvenation (replanting) requires palm oil seedlings. If estimated current replanting of palm oil plantations in Indonesia is 300,000 hectares per year (or 1.8% of Indonesia's oil palm plantation area), then with an average oil palm plantation population of 125 trees per hectare, the need for palm oil seedlings reaches 37,500,000. And with 114,000 hectares in Malaysia, the need for palm oil seedlings will reach 14,250,000 seedlings. Producing quality palm oil trees, in addition to selecting superior varieties, also includes seedling production in palm oil nurseries. Biochar can be used effectively in palm oil nurseries, as it helps improve seedling growth and health.

Biochar, made from biomass, functions as a soil amendment, improving soil structure, water retention, and nutrient availability, while also providing a favorable environment for the growth of soil microorganisms. Biochar can be mixed directly into the growing medium during nursery cultivation, with the dosage adjusted to the type of growing medium and the plant's needs. Numerous studies have shown that applying biochar to palm oil nurseries can improve seedling growth, including plant height, stem diameter, leaf number, and root dry weight. By utilizing biochar, palm oil nurseries can become more efficient, productive, and environmentally friendly.

And because the planting medium for palm oil seedlings generally uses compost, if the compost is enriched with biochar or the composting process also uses biochar, the compost quality will be even better. The advantages of the composting process using biochar include improving compost quality, accelerating the composting process, reducing greenhouse gas emissions in the form of methane (CH4) and nitrogen oxide (N2O), reducing ammonia (NH3) loss, increasing aeration (bulking agent) in composting, and reducing odor. As for the biochar material itself, it will enrich the biochar with various nutrients and the biochar is not damaged or decomposed during the composting process. So by utilizing biochar in composting, we can process organic waste more effectively, produce high-quality organic fertilizer, and contribute to more sustainable agricultural practices. 

Palm Oil Mill Operation with Pyrolysis and Biogas Unit Integration for Zero Waste, Maximizing Profits and Sustainability

The goal of a palm oil mill to achieve zero waste, maximum profit, and sustainability can be achieved, among other things, through the integration of pyrolysis and biogas unit. This is because nearly all solid and liquid waste from the palm oil mill can be processed into products needed by the palm oil industry, both in the palm oil mill for CPO (crude palm oil) production and on the palm oil plantation for FFB production. With pyrolysis, solid waste is converted into biochar, producing excess energy in the form of syngas and biooil for boiler fuel. Biochar is first used to increase biogas production before being applied to plantation or agricultural land. 

The biogas product can also be used as fuel for palm oil mill boiler, along with syngas and biooil. This method allows 100% of the palm kernel shell (PKS) to be sold or even exported, thus providing additional profits for the palm oil industry. Currently, 30-50% of the palm kernel shell (PKS) is generally used for boiler fuel, mixed with mesocarp fiber, and the remainder is sold or exported. Biochar production with pyrolysis. The biogas product can also be used as fuel for palm oil mill boiler, along with syngas and biooil. This method allows 100% of the palm kernel shell (PKS) to be sold or even exported, thus providing additional profits for the palm oil industry. Currently, 30-50% of the palm kernel shell (PKS) is generally used for boiler fuel, mixed with mesocarp fiber, and the remainder is sold or exported. Biochar production by pyrolysis can utilize both coconut fiber (MF) and empty fruit bunches (EFB) of palm oil. The integration scheme is as follows:

 

The use of biochar on plantations and agricultural lands will save or reduce the use of chemical fertilizers. This is especially true for oil palm plantations, where the largest operational cost is the use of chemical fertilizers. Reducing chemical fertilizer use will result in savings in fertilizer costs. Furthermore, it will provide other environmental benefits, reducing environmental impacts by minimizing waste from excessive chemical fertilizer use. Biochar slow-releases chemical fertilizers, increasing fertilizer efficiency or Nutrient Use Efficiency (NUE). Furthermore, when combined with biochar and organic fertilizer from biogas residue, the slow-release capacity of chemical fertilizers is further enhanced, resulting in higher NUE. Furthermore, another pyrolysis byproduct, pyroligneous acid (PA), is also highly beneficial for palm oil plantations as a liquid organic fertilizer and biopesticide.

Another source of income is carbon credits, or BCR (biochar carbon removal). Furthermore, carbon credits are currently a strong motivator for producers to produce biochar. To obtain these credits, biochar producers must register with a carbon standards organization and follow their methodology. Some popular carbon standards organizations include Puro Earth, Verra, and CSI. Meanwhile, for biogas production, carbon credits can also be obtained through methane avoidance mechanisms. However, the price of biogas from methane avoidance is usually lower than carbon credits from carbon removal or carbon sequestration with biochar. However, both can be accumulated and yield greater profits.

The operational potential of palm oil mills with integrated pyrolysis and biogas units for zero waste, maximizing profits, and sustainability is enormous and is predicted to become a trend because financial returns align with environmental benefits. Furthermore, environmental and sustainability issues are currently a global concern. With approximately 17 million hectares of palm oil plantations and 5.5 million hectares in Malaysia, the potential for biomass waste, particularly EFB and mesocarp fiber for biochar production, and POME waste for biogas production, is abundant. Globally, palm oil plantations cover nearly 27 million hectares. By 2024, Indonesia will be the world's top CPO producer with 56%, followed by Malaysia with 26%, and Thailand with 5%. There are more than 1,000 palm oil mills in Indonesia and approximately 500 in Malaysia. 

Optimization of Palm Oil Mill Operations to Maximize Profits by Utilizing EFB Waste

As a profit-oriented company, palm oil companies will also do various things necessary to maximize their profits, both in the operations of their palm oil mills and on their plantations. The more efficient the operations of the palm oil mill, as well as on its plantations, the higher the profits obtained. Minimizing the environmental impact of waste produced, even zero waste, and becoming part of responsible and sustainable environmental management practices, including part of climate solutions, are important parts of this industry that cannot be abandoned. That is why palm oil mills must innovate to achieve optimal conditions. To achieve these conditions, it can be done by evaluating current practices and finding better solutions.

CPO (crude palm oil production) requires steam for the sterilization process. This is why palm oil mills definitely need boilers for their production process, for more details read here. Steam from the boiler is also used for power generation with steam turbines to drive generators. The operation of the boiler is generally carried out by burning fiber (mesocarp fiber) and some palm kernel shells / PKS, so that some palm kernel shells /PKS can still be sold or even exported. This common practice in palm oil mills has also been running for decades, but it turns out that there is still a lot of biomass waste from palm oil mills that has not been utilized, especially empty fruit bunches or EFB (empty fruit bunches) which account for around 23% of the fresh fruit bunches (FFB) processed. These EFBs are usually only piled up behind the palm oil mill and tend to pollute the environment.

The EFB can be processed into biochar. Biochar production with thermal processes, either pyrolysis or gasification, will produce energy as cogeneration in palm oil mills. Cogeneration is the right solution for biochar production while supplying energy needs for boiler operations. In this way, 100% of palm kernel shells / PKS can be sold or even exported, meaning that palm oil companies' profits are greater. But to maximize biochar production, pyrolysis is the right choice. This is because gasification technology is to maximize gas products while pyrolysis is to maximize solid products (biochar). By-products from pyrolysis are also beneficial for the palm oil industry.

Empty fruit bunches (EFB) are solid waste from palm oil or CPO production which is the largest in number. This is what makes many machine manufacturers make these EFB processing machines. Most of the machines made are equipments for cutting and pressing the EFB so that the water content decreases and the material size becomes smaller. However, both the water content and the size of the EFB as the output of the machine or equipment still do not meet the requirements to be further processed into biochar. The typical output is more than 4 inches and the water content is more than 45%. EFB must have a low water content of 10% and can be less than 1 inch for biochar production or as fuel in the boiler.

  

To obtain the EFB with a dryness level or water content of 10%, waste heat recovery from palm oil mills can be utilized for the drying process. Other biomass waste from the palm oil industry can be utilized as fuel or a source of heat energy for drying the EFB. By utilizing these biomass wastes, mill operations can be more efficient so that profits are maximized and environmentally friendly with zero waste. 

Bioeconomy: Carbon Neutral Economy (Wood Pellets & PkS) VS Carbon Sink Economy (Biochar)

Market readiness and availability are important factors for the growth and development of a business in general and biomass-based businesses in particular. And globally according to Hawkin Wright, predicting wood pellet sales will reach the highest among other biomass fuels, which is more than 27 million tons/year in 2025. While FutureMetric also predicts that the market for wood pellets for industry (industrial pellet fuel) can reach 55 million tons in 2030. Thus the need for wood pellets will continue to increase by an average of more than 5.5 million tons per year since 2025, so too for wood pellet production. In addition, PKS (palm kernel shell) are also an alternative biomass fuel besides wood pellets and PKS is the main competitor of wood pellets in the global biomass fuel market. But compared to wood pellets, global PKS trade is relatively small, estimated at only 5 million tons/year. Indonesia is the largest producer of PKS in the world because it is comparable to the area of  palm oil plantations and as a producer of palm oil / CPO or the owner of the largest oil palm plantation in the world.

Meanwhile, biochar, specifically for Europe alone, is estimated to have 51 new biochar factories or a total of 220 units, with biochar production estimated to be 115,000 tons per year. And global biochar production in 2023 is estimated to reach 350 thousand tons or equivalent to 600,000 carbon credits and is expected to continue to increase. And in 2025, the biochar industry is predicted to grow more than 5 times compared to 2023. The existence of carbon credits is one of the biggest motivations for biochar production. With the existence of carbon credits, there is a significant surge in biochar production from before. As an illustration, in 2023, this biochar carbon credit will make the largest contribution, namely 90% of carbon removal in the voluntary carbon market according to data from CDR.fyi.

The main market or user of wood pellets (industrial pellet grade) are power plants that carry out cofiring with renewable fuels, namely biomass-based, especially wood pellets. The greater the cofiring ratio, the greater the need for wood pellets. With a capacity or size of hundreds or even thousands of MW of power plants, the need for wood pellets is also high even with a low cofiring ratio. The trend of coal-fired power plants to carry out cofiring is getting bigger and also the increase in their cofiring ratio, even a number of coal-fired power plants can switch to 100% using wood pellets (fulfiring). In addition, a number of biomass power plants, both 100% with wood pellets or PKS, have also been built and started operating. There is a global target that the portion of coal-fired power plants must decrease to 4% (from the current condition of around 30%) by 2030 and 0% by 2040 if the world wants to limit global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) and prevent the occurrence of severe damage from the climate crisis. This is also what makes a number of coal companies in Indonesia develop renewable energy, especially wood pellets from energy plantations.

While biochar, although its market potential is also very large, the problem is that awareness is still low, so education and socialization still need to be improved. Like the market for biomass fuel in the form of wood pellets and PKS / palm kernel shells which are generally large companies (because they are also the largest CO2 emitters), to accelerate the biochar industry, a large capacity market or user is needed. Large farms and plantations as well as energy plantation forests or energy plantations are potential markets / large users of biochar. Likewise, post-mining reclamation lands that will be revegetated are also potential users / large markets for biochar. This is also related to the fact that a significant volume is needed to be able to produce adequate CO2 absorption volume (carbon sequestration / carbon sink). Meanwhile, from the agricultural or plantation side or application to the soil related to the use of biochar, so far, when considering the effects of biochar, the focus has only been on increasing crop yields. However, the added value that biochar can offer in its application in soil, at least in optimal agricultural systems, includes not only increasing crop yields, but also counteracting the loss of humus in the soil, preventing nitrate leaching, and increasing water storage capacity to increase crop resistance to drought and resilience to the climate crisis.

And basically both biomass fuel production such as wood pellets and carbon sink materials such as biochar will have a positive impact on the climate, even both can support each other such as if biochar is used for energy plantations and then wood products from the energy plantation are used for wood pellet production, more details read here. The use of renewable energy will reduce the concentration of CO2 in the atmosphere because it does not increase the concentration of CO2 or is carbon neutral, while biochar will reduce the concentration of CO2 in the atmosphere because it absorbs CO2 in the atmosphere in biomass which is then concentrated by pyrolysis to become biochar, or carbon negative. Even making a carbon sink, but not reducing the source of its emissions is a futile or irrelevant effort, more details read here. So bioeconomy with carbon neutral economy, namely biomass fuels such as wood pellets or PKS or carbon sink economy, namely with biochar, will be closely related to business readiness such as market / user aspects, raw materials for certain production capacities, raw materials and so on. These characteristics need to be considered carefully and comprehensively so as to produce optimal and sustainable profits.

Cogeneration in Palm Oil Mills with Pyrolysis, Initial Steps in Biochar Production and Implementation

The analogy is like cofiring carried out in coal-fired power plants by mixing biomass fuels with a certain ratio as an effort to decarbonize the energy sector in power plants. While in palm oil mills, cogeneration with pyrolysis is an innovative initial step to enter the carbon negative era with the application of biochar, the main product of pyrolysis. And because all palm oil mills use biomass fuel for their mill operations, they are already based on carbon neutral fuel, unlike coal-fired power plants which are based on carbon positive fuels because they come from fossils.

Unlike cofiring which mixes coal and biomass fuels with a certain ratio and then burns them together in a furnace such as pulverized combustion, cogeneration is done by producing energy separately but the energy output is for the same use or especially the same boiler. This is done because the types of fuels may be different, such as solid fuels with liquid fuels or the technology for producing the energy is different. With this cogeneration, it means that not all energy is produced from one energy source or energy from cogeneration is a secondary energy source to meet total energy needs, and in the case of cogeneration in this palm oil mill, energy from combustion is still the primary energy.

Then why not just do full pyrolysis? It is easier, gradually for palm oil mills to adopt pyrolysis technology and its characteristics. Because (slow) pyrolysis aims to maximize solid / biochar, the by-products in the form of excess energy (syngas and biooil) as a source of boiler fuel, the calorific value is not as much as combustion which is indeed intended to maximize heat. Only about 1/3 of the excess energy contributes (cogeneration) as boiler fuel. In other words, if full pyrolysis is carried out directly, the amount of biomass as raw material for pyrolysis becomes 3 times greater or the pyrolysis unit becomes very large so that all palm oil mill biomass waste is used, and the mill cannot sell its palm kernel shells.

What are the benefits obtained by palm oil mills if they carry out cogeneration with pyrolysis for biochar production? Among the biochar products, it can save fertilizer use in oil palm plantations, overcome the problem of empty oil palm bunches (EFB) so that palm oil mills can achieve zero waste, palm kernel shells (PKS) that have been used for boiler fuel can be sold to increase income, the productivity of fresh fruit bunches (FFB) of palm oil increases, the application of biochar in palm oil plantations is also a climate solution (carbon sequestration / carbon sink) so that it can get carbon credit compensation and with good waste management, even zero waste and the application of biochar in palm oil plantations, palm oil companies will get a good image in terms of the environment and sustainability.