Export Wood Pellets to Japan, Is It Possible?

The consumption of biomass fuels especially wood pellets in Japan continues to increase over time according to the target of 4-6 GW in 2030. Supply of wood pellets for Japan, especially from Canada, have a volume of more than 250 thousand tons annually. The use of wood pellets is mainly for fuel generating electricity (read the background here). Wood pellet producers in Asia are also increasing, but the fact is that not many of them can export to Japan. Japan applies strict standards for the quality of wood pellets and also guarantees that wood pellets are produced in an environmentally friendly manner as evidenced by a sustainability certificate in the form of FSC. Another factor that makes it difficult to export wood pellets to Japan is the application of long contracts with fixed purchase prices for a certain time. That is because with the FIT (Feed in Tarrif) policy, the selling price of electricity produced is also fixed for 20 years with prices depending on the type of fuel. In addition, the volume of shipment needed is also quite large, which is 10 thousand tons for each shipment. This has consequences for the capacity of the wood pellet plant.

Then how about the track record of export wood pellets from Indonesia? It turns out that wood pellet exports from Indonesia to Japan are still very minimal, in general only for the trial phase. This is very different from other biomass fuel commodities namely palm kernel shells (PKS) whose export volume to Japan alone is estimated at more than 1 million tons annually. Why did it happen? First, the average wood pellet producer in Indonesia is still in small capacity or less than 5000 tons / month. In addition, the majority of raw materials used come from sawdust from sawmills and wood wastes from the wood processing industries. This condition also makes it very difficult or impossible to obtain a sustainability certificate because it is very difficult to trace the source of wood from its origin. Second, the amount of PKS is abundant in palm oil mills because it is one of the solid wastes from palm mills or CPO production. With national CPO production estimated to reach more than 40 million tons / year, the resulting PKS are estimated to reach more than 10 million / year and only through a simple process can the PKS be exported. Technically, PKS also have many similarities with wood pellets for technical specifications such as heating value, size, etc., as well as having advantages namely of easier handling and lower prices.

One scenario to be able to export wood pellets to Japan, is the production of wood pellets from energy plantations. With an energy plantation, the origin of the wood so that all aspects of its cultivation can be clearly monitored and verified so that certificates like FSC can be easily obtained. The supply of raw materials can also be guaranteed and it is possible for large capacity production. To optimize the energy plantation can also be integrated with sheep, cattle and goat farms and honey beekeeping. The three important aspects for human life, namely food, energy and water can be done with these activities, for more details can be read here.

Another alternative is to produce EFB pellets or palm oil empty fruit bunches pellet, but EFB pellets are not a wood pellet group, because they originate not from woody biomass, but from agricultural waste so they are called agricultural waste pellets or agro-waste pellets. The quality of agro-waste pellets is generally lower than that of wood pellets mainly because of the higher ash content and the lower heating value. In addition to the technical factors above, there are important things to consider for the production of EFB pellets is the availability of electricity. This is because palm oil mills are generally in remote locations making it difficult to get electricity supply, while electricity produced by palm oil mills is also inadequate when used for EFB pellet production. To be able to produce electricity, namely by producing biogas from POME (palm oil mill effluents), and for more details, please read here.

Biomass Efficiency Improvement for Energy Sufficiency

Talking about oil palm plantations, Indonesia is top of that, coconut plantations, and so on, rubber plantations, too. But speaking of energy self-sufficiency, energy diversification, energy security and the role of bioenergy or biopower, it's still very far to be said as the champion. Energy is clearly an important sector, after food. The late innovation in this sector also has the potential of this country not developing even controlled by foreign parties. The vast amount of biomass has not been utilized efficiently and optimally. ESDM noted that less than 2% of biomass was used. The efficiency improvement alone has actually contributed greatly to energy sufficiency. Today's problems such as the scarcity of 3 kg LPG gas in some locations can also be overcome by increasing the efficiency. Global environmental problems such as climate change and global warming can also be mitigated by biomass because it is a carbon neutral fuel. Whereas when the energy needs are getting bigger, it is necessary to create new energy sources namely by multipurpose energy plantation.

Indonesia's oil palm plantations today cover 12 million hectares and number 1 in the world. Of course the biomass production is very large. There are two groups of biomass sources from the oil palm plantation, namely from the plantation side and the processing plant side. On the plantation side, waste in the form of fronds, trunks and palm leaves has not been utilized and only stacked in the plantatin until decayed. While from the side of the processing plant, namely the palm oil mill or CPO production, biomass waste in the form of palm kernel shells, empty fruit bunches, fibers (mesocarp fiber) and liquid waste. All of these wastes can be used for energy, only fibers from fruit bunch (mesocarp fiber) have been used up as fuel for the operations of the palm plant (electricity generation and steam production. Hard and difficult decomposed biomass can be processed into pellets and briquette, while biomass which is rich in organic matter is processed with biological routes (fermentation) for biogas production.

Pellet or briquette factories can be built adjacent to a plantation or CPO factory or based on raw material oriented. If the plant is built away from raw materials, transportation costs will be expensive because the raw material takes up a large volume (bulky). The capacity of the plant is also adjusted to the availability of raw materials, so that if the plant uses raw materials from oil palm plantation waste such as fronds and trunks. Plantation maintenance by cleaning palm fronds and replanting programs that leave palm oil trunks (read more about oil palm pellets here and here) which is carried out periodically is the source of raw material for the production of pellets. While the pellet plant that uses raw materials from the palm oil mill, the capacity is also automatically adjusted to the palm oil mill. Empty fruit bunches (EFB) are solid wastes produced in the daily operation of palm oil mills that can be used for the production of these pellets. Whereas palm kernel shell (PKS) is also produced as a solid waste of palm oil mills, but because the size and properties are similar to wood pellets, it does not need to be processed into pellets, the only do just cleaned from impurities and used for fuel. This palm kernel shell is also a wood pellet competitor, the majority of which can only be obtained from Indonesia and Malaysia. Europe and North American countries (US and Canada) cannot produce palm kernel shells because there are no oil palm plantations there.

Comparison between palm kernel shell and wood pellet

Last about aspect of the market. Whatever the production, if there is no market or buyer, the same is a lie. The export market is also in dire need of biomass fuel because of the global consensus to reduce CO2 in the atmosphere which is widely described as the culprit (trouble maker) of climate change and global warming. Biomass fuels, especially pellets and palm shells, are categorized as carbon neutral but their management must be sustainable. Each pellet also has its own market, more details can be read here. Domestic markets also need to be built. When a pellet manufacturer can provide these pellets continuously along with cooking stoves and various energy conversion tools, which is also part of educating the market (for current conditions), then the use of pellets gradually increases. Insha Allah. Moreover, the condition of fuel scarcity, especially for households in a number of areas which is worrying, will also be a driving force or motivation for the production of these pellets. And it is not impossible, Indonesia is one of the main players in the world's biomass fuel. Wallahu 'Alam