Opportunities to Supply Biomass Fuels to Japan

Loading palm kernel shells / PKS for export

Japan currently operates approximately 290 biomass power plants. Its installed capacity is 7.3 GW, but only 4.96 GW (~68% of installed capacity) are actively operating, with peak electricity output reaching 2024. A projected 6 GW of additional power plants are expected by 2030, but several slowdowns have occurred due to power reductions and even closures. This has occurred at the Taketoyo JERA plant, which reduced its operating level or power output, and the Suzukawa plant, which was closed due to economic pressures. Despite this, plans for new biomass power plants remain strong, with 11 new plants scheduled to be operational by 2025, which could increase annual biomass fuel demand by approximately 1.1 million tons. The need for biomass fuel is a business opportunity that must be exploited, especially since biomass fuel for biomass power plants in Japan is largely imported. Here are two examples of brief profiles of biomass power plants in Japan :

1. Renova

Renova is a 75 MW biomass power plant located at Omaezaki Port in the southernmost part of Shizuoka Prefecture. The biomass fuel used in the Renova plant is wood pellets and palm kernel shells (PKS).

Fuel quality and sustainability are key concerns for Renova, for example, in palm kernel shells (PKS), where the presence of foreign impurities and moisture content must be within acceptable limits or as low as possible. Meanwhile, for wood pellets, technical aspects such as density and the percentage of fine particles are of concern. This is why Renova feels the need to encourage investment in fuel testing and analysis.

The renewable energy facility had previously delayed its commercial operation twice due to the need for additional time for final adjustments to the boiler and turbine to ensure stable operation. Initially scheduled for December 2023, Renova stated that the launch was also delayed in December 2024, and finally began operations in early 2025. These modifications were necessary to ensure long-term stable operation.

Renova is the largest shareholder in Omaezakikou with a 38% stake. Chubu Electric Power Co. Inc. is second with 34%, while Mitsubishi Electric Financial Solutions Corp. and Suzuyo Shoji Co. Ltd. hold 18% and 10%, respectively. The company is also exploring alternative biomass fuels, such as empty fruit bunches (EFB), to diversify its biomass fuel supply and control costs with lower purchase prices.

2. Kanda

Biomass Energy in Kanda City, northeast of Chiyoda, Tokyo. Inaugurated in June 2021, this 75 MW facility operates exclusively on biomass. With an annual capacity of approximately 500 million kWh, the plant generates enough renewable electricity to meet the electricity needs of 170,000 households.

Kanda Biomass Energy utilizes three types of biomass: wood pellets (60 percent), palm kernel shells (PKS) (30 percent), and wood chips (10 percent). This fuel mix reduces greenhouse gas emissions into the atmosphere by 670,000 tons per year compared to a coal-fired power plant with the same capacity. Wood pellets are imported from British Columbia, Canada, and Vietnam, palm kernel shells (PKS) from Indonesia, and wood chips are sourced locally from northern Kyushu.

The plant has three dedicated fuel tanks for storing wood pellets. Biomass is fed into a circulated fluidized bed (CFB) boiler, which converts it into superheated steam to drive a power-generating turbine. The steam is then cooled, condensed, and recycled back into the system, ensuring efficient and sustainable electricity generation for residential and industrial users in the region.

The Kanda Biomass power plant is owned by Renova (43.07%), Sumitomo Forestry (41.5%), Veolia Japan (10%), Kyuden Mirai Energy (5%), and Mihara Group (0.43%). The biomass power plant was originally developed by Nippon Steel Engineering, Renova, and Sumitomo Heavy Industries.

Taiwan, Asia's New Wood Pellet Market

After Japan and Korea have been the main markets for wood pellets in Asia for years, Taiwan is predicted to emerge as a new destination for the wood pellet market in Asia. This is because Taiwan's energy policy targets 20% renewable energy use by 2025. Namely by focusing on the energy transition from coal and other fossil fuels to renewable energy sources including biomass, solar and wind to increase renewable energy from 10% to 20% by 2025. The Greenhouse Gas Reduction and Management Act requires annual carbon emissions to be reduced by 20% by 2030 and 50% by 2050, below 2005 levels or a reduction of 53 million tons of CO2 equivalent by 2030 and 133 million tons by 2050. This is also part of Taiwan's nuclear-free vision and supports the national goal of achieving net-zero carbon emissions by 2050. Renewable energy development is the most important implementation to achieve this goal and wood pellets are a top priority. Taiwan will import wood pellets in large quantities to achieve its new green energy production targets.

The need for wood pellets in Taiwan reaches millions of tons or more detailed estimates are 1.7 million tons per year specifically for Taiwan Power Company, which will be implemented immediately when the policy is implemented. And there are also a number of independent power plants (IPP) that use coal boilers to generate electricity, especially the plastic industry, petroleum refineries and papermaking. Currently, renewable energy accounts for less than 10% of the total energy output in Taiwan. Meanwhile, the government aims to have 778 megawatts (MW) of biomass-based power plants by 2025, allowing production of 4.1 billion kWh.

The world's major wood pellets producing countries are looking to Taiwan, such as the United States, Vietnam and Canada. Vietnam has even become the second largest wood pellet producer in the world, overtaking Canada. And nationally, Vietnam's wood product exports are more than 70% for furniture and interior applications, 7% for wood-based panels, 17% wood chips and 5% for wood pellets. And to produce these products, Vietnam also imports large amounts of wood from more than 114 countries and 700 species / subspecies, amounting to $ 3.1 billion in the form of logs, sawnwood and plywood and imports almost 2 million cubic meters of tropical hardwood.

Basically, the major wood pellet producing countries are competing to convince Taiwan as a user or buyer of wood pellets about the supply capability, including quantity and quality, logistics reliability and sustainability of its supply. Although the Japanese and Korean markets continue to grow, penetration into a new market will add an opportunity to these producers. Even in Japan, many new power plants are being built so that the need for wood pellets is also increasing. In addition, the increase in the cofiring ratio in power plants in Japan will also increase the demand for wood pellets.

And globally according to Hawkin Wright, wood pellet sales are the highest among other biomass fuels, which is more than 27 million tons/year in 2025. While FutureMetric 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 with an average of more than 5.5 million tons per year so that the production of wood pellets. Indonesia still has great potential to become a world wood pellet producer because of the potential raw materials that can be sought, both from wood and forestry industry waste and from energy plantations. With a location that is not too far from Taiwan (compared to wood pellet producing countries such as the United States and Canada) so that logistics or transportation costs are cheaper, the opportunity to compete is also quite large. In addition, PKS (palm kernel shell) are also an alternative biomass fuel besides wood pellets and as a producer of palm oil / CPO or the owner of the largest palm oil plantation in the world, Indonesia is number one for that. 

Problems of Wood Harvesting from Calliandra Energy Plantation and High Potassium Content in Wood Pellet Ash: Two Things That Need Attention

The factor of production efficiency and standard and stable product quality is the mindset of the industry, including for the wood pellet industry from the calliandra energy plantation. Manual wood harvesting operations make production efficiency low. The high daily need for wood pellet raw materials from energy plantations requires mechanization equipments for harvesting the calliandra plantation. Meanwhile, calliandra wood pellet products with high ash content containing potassium also require certain treatments so that the wood pellet products meet the standards for power plants in general. The stability of production quality and quantity is closely related to the quality of the production equipment used. These two things must be an important concern for wood pellet producers from calliandra energy plantations with large capacity and export orientation.

The wood pellet industry from the calliandra energy plantation is new, so there are not many references. The history or the origin of this industry comes from the project of the Ministry of Forestry of the Republic of Indonesia at that time which created an incubator-scale industry as a pilot for the production of wood pellets from the calliandra energy plantation located around Geger Hill, Bangkalan, Madura, East Java about 12 years ago. At that time, there were actually several wood pellet industries operating, but all of these wood pellet factories or industries used raw materials from wood industry waste, such as sawmill industry waste, barecore industry waste, plywood industry waste and so on.

Calliandra trees are also not new plants to the public. This tree has been widely planted but previously with different purposes, namely for reforestation, for animal feed or for honey bee farming. While for bioenergy purposes or wood pellet production, planting calliandra trees in the form of energy plantations is something new. That is why in the early stages, calliandra wood harvesting was still done manually and this was ineffective and inefficient on large-capacity plantations. In addition, the wood pellet product has not been analyzed or examined completely / comprehensively so that the high potassium content (ash chemistry) in the ash has not been detected. When the requirements for the maximum content of potassium / potassium must be met, special treatment needs to be done.

In addition, an important thing to note is the target types of products produced. If the calliandra plantation not only produces wood as raw material for wood pellet products, but also processes leaves for animal feed, then the harvesting mechanism is very influential. The leaves from the calliandra plantation must also be harvested effectively and efficiently or the same as the wood products. This could be, for example, the trees and leaves are harvested together and then taken to a place and separated to be processed individually. Or it could be that the wood and leaf products have been separated at the time of harvesting, then each goes to its respective processing unit. The equipment used must also be different according to the choice of the harvesting mechanism. Meanwhile, honey products from bee farms that utilize calliandra nectar are not affected by this mechanism, this is a separate honey production process and is related to the flowering season of the calliandra tree itself.

Along with the global decarbonization trend, the prospects for calliandra plantations are increasingly bright. It is predicted that many calliandra plantations will be created, which are intended primarily for bioenergy production such as wood pellet production, and this is in line with the carbon neutral scenario that supports the net zero emission program. The use of wood pellets is mainly for fuel in coal-fired power plants through the cofiring mechanism. In the next stage, it is possible to use 100% of the power plant fuel using wood pellets (fulfiring). The high potassium content is generally a problem in applications for this power plant, although there are types of power plants that technically do not have a problem with the potassium content, but the production of wood pellets from calliandra with low potassium content is certainly preferred.

Will Indonesia's Wood Pellet Production Beat Vietnam?

Vietnam's wood pellet production began in 2012 with a very small capacity of around 175 tons/year and now in 2021 or about 9 years later, its production has reached around 4.5 million tons/year, placing Vietnam in second place as the world's wood pellet producer after the United States. The total production of 4.5 million tons/year is supplied from 74 wood pellet factories in Vietnam. In 2020 exporting wood pellets of 3.2 million tons to Japan and Korea for power plants with an export value of close to USD 351 million. In addition to Korea and Japan, Vietnam's wood pellets are also exported to Europe.

Initially, Vietnam's wood pellet production used waste from the furniture industry. Furniture waste in the form of sawdust from the industry has dried and the particle size is suitable for wood pellet production, so equipments such as hammer mill and dryer are not needed. Many Vietnamese wood pellet factories at that time did not have the hammer mill or dryer. With raw materials that are ready to be pelleted, the cost of producing wood pellets is very cheap, plus labor costs are also cheap. But as the demand for furniture industry waste for wood pellet production is getting higher, the availability of these raw materials is getting scarcer, so that new wood pellet factories can no longer use these wastes. Other wood processing industry wastes such as sawmills and veneer factories also become raw materials. Furthermore, with the increase in wood pellet production, forest wood wastes and other logs become the next source of raw materials. This also makes production costs increase because they need equipments such as hammer mills and dryers so that the raw materials are ready to be pelletized.

Vietnam is the largest exporter of wood furniture to the United States, surpassing China. In 2020, Vietnam's wooden furniture exports to the United States reached more than USD 7.4 billion, an increase of 31% compared to 2019. Meanwhile, China exported wooden furniture worth USD 7.33 billion in 2020. Although the difference is only small, it proves about growth of Vietnam's growing wood furniture industry. Meanwhile, the export of Indonesian furniture and handicrafts according to HIMKI (Indonesian Furniture and Handicraft Industry Association) is estimated to reach USD 2.75 to 3 billion this year. According to Abdul Sobur, president of HIMKI, the furniture and handicraft industry is an important industrial sector and has become a pillar in the current pandemic era. With Indonesia's land area reaching 1.9 million square km or more than 5 times that of Vietnam, Indonesia's potency to develop the wood pellet industry is very potential for Indonesia. In addition to utilizing biomass waste from the furniture and handicraft industries, the wood processing industry, and forest wastes, energy plantations are also very potential to be developed in Indonesia. One of the advantages of Vietnam compared to Indonesia is its position which is closer to Korea and Japan so that the cost of transporting wood pellets to buyers or users is cheaper.

With this land area, Indonesia has the potential to develop energy plantations for massive wood pellet production. Even the energy plantation can be made from ex-coal mining land which covers an area of about 8 million hectares, for more details read here. Although currently Indonesia's wood pellet production is still around 100-200 thousand tons / year or like Vietnam’s wood pellet production in 2012 but with this huge potential, Indonesia's potential to become the world's main producer of wood pellets is also large, even becoming a leading country in energy use of biomass. The cofiring program at a number of coal powerplants in Indonesia also encourages the use of biomass energy, especially wood pellets. There are 114 coal powerplants units owned by PLN (Indonesia state owned electricity company) that have the potential for cofiring spread across 52 locations with a total capacity of 18,154 megawatts (MW) with a target for completion in 2024. Energy plantations in addition to supporting business & energy security, should also support the livestock sector, especially ruminants for more details read here, so that food security to achieve self-sufficiency in meat can be done. So can Indonesia surpass Vietnam's wood pellet production? Of course it can, but it takes a lot of extra efforts, and it takes a long time. But at least if Indonesia promotes its wood pellet production, there will be many benefits, including economic, social and environmental.

Debarking from Energy Plantation Wood, Is It Necessary?

Debarking machine

Wood pellet target market is an important thing that needs attention. If the power plant is the main market for wood pellets, the quality standard of wood pellet products follows the technology used by the power plant. Meanwhile, if wood pellets for households who want premium quality, wood pellets that are produced also follow these quality standards. The wood pellet market for electricity generation needs large, different from the wood pellet market for households that are sold in small packages or the retail market. Electricity generation technology also needs to be monitored so that all wood pellets produced can be absorbed. Pulverized and fluidized bed combustion technology is the technology most widely used for electricity generation. In pulverized combustion technology generally wood pellets cannot be used 100% (except with a number of modifications), while fluidized bed technology can use wood pellets or biomass pellets from various raw materials.

What is debarking? Why do need debarking? Debarking is the separation of bark from log, with the aim of reducing ash content. That means that if the ash content of the log with the bark can be accepted by the user, of course debarking is not necessary. For power plants usually can accept wood pellets up to 2% ash content for standard pellets and 6% for utility pellets. Meanwhile, if the user wants a wood pellet product with very low ash content, premium pellet (less than 1%), then debarking must be done. The wood species used also affects the ash content. Almost all energy plantations use fast rotation plants and coppice such as gliricidia with ash content of more than 1% so that it is more suitable for electricity generation and do not need debarking.

CFB Powerplant in Japan

Another thing to note is ash chemistry. The potassium and chlorine content in the ash is a critical point that needs attention. Fast rotation plants in general have a high potassium content than wood biomass in general. This makes the use of power plants in particular pulverized combustion increasingly limited to cofiring applications. Whereas in fluidized bed combustion because the operating temperature is lower then it can be tolerated and is considered not to cause problems. This means that wood pellets from energy plantation wood are compatible with biomass power plants with fluidized bed technology and can be used for cofiring with a certain percentage of pulverized combustion.

Building an Export-Oriented Wood Pellet Plant from an Energy Plantation

Although geographically, Indonesia is the largest country in the Southeast Asian region and has a tropical climate, the export of wood pellets from Indonesia is still very small and far less than Vietnam. The destination of Vietnam wood pellet exports to Korea and Japan. Japan's wood pellet imports in 2018 are estimated to be more than 1 million tons, or that number is almost double that of 2017, with a percentage of 63% coming from Canada and 31% from Vietnam. It means a small area but able to export wood pellets to Japan with a minimum of 310 thousand tons / year, while Indonesia is estimated to be less than 100,000 tons / year.

Indonesia is also very potential to develop energy plantations for the production of wood pellets. Even the energy plantation can be integrated with large farms such as sheep, cows and goats and honey beekeeping, for more details, please read here. So that in addition to the energy sector, the food sector and environmental conservation in the form of water and land can also be maintained. Why are currently no wood pellet producers from export-oriented energy plantations in Indonesia? Even though the potential of raw materials and markets is huge. Profit estimates are also interesting especially with the optimization of land use and the energy plantation harvest.

There are several analyzes, to answer this, among others as follows, first is market access. The market or buyer is important for investment in a wood pellet factory worth hundreds of billions, so the market guarantee is very important. Abundant production but no one absorbs it or the buyer will make the factory stop production and go bankrupt. The characteristics of wood pellet products will also determine the user or user of the wood pellet. Although the same is for power plant consumption but the power generation technology is also different, so it requires different technical specifications of wood pellets.

Second, the cost factor. Cost factor may be the main obstacle, this is because wood pellet plants from energy plantations are not something cheap, but they are generally cheaper than palm oil mills and plantations, for more details, please read here. But with good prospects in the renewable energy sector from biomass, there should be many investors interested in investing in this business. Non-usurious mutual investment is the best choice to execute it. It is estimated that for wood pellet plant with a capacity of 10,000 tons / month (20 tons / hour), more than 100 billion rupiah.

Next, the third factor is infrastructure. A number of regions do not yet have adequate infrastructure despite the vast available land. Provision of infrastructure such as roads, bridges and so on is not something that is easy and inexpensive, so that it can be a significant obstacle. This is why site selection is important. The availability of electricity is another thing that needs attention and is an important consideration. Electricity is vital for wood pellet production or factories. If it turns out there is no electricity supply, then the wood pellet plant must make a power plant. With a range of 250 KW of electricity demand per ton/hour of wood pellet production, for wood pellet production with a standard export volume of at least 10,000 tons/month or 10,000 tons/shipment or 20 tons/hour requires 5 MW.

The power plant is quite large, as comparison because for the size of a large palm oil mill the electricity needs are only around 2.5 MW and the investment in power plants for each MW is 1 million US dollars, so for 5 MW it requires 5 million US dollars or around 70 billion rupiah. Infrastructure such as adequate ports is also very important. Wood pellet plants generally have wood pellet storage units close to the port so that they are easy to ship. The wood pellet storage facility with a capacity of 10,000 tons also requires a large enough building, estimated at more than 50 billion rupiah.

Wood pellet port with storage facility at Prince Rupert, BC, Canada

At present, wood pellet production generally only relies on sawmill waste and wood industry waste. Supply of raw materials fluctuating in both quality and quantity. In the rainy season in general, wood processing factories need more waste as fuel to dry wood they processed, so that wood waste that can be taken is reduced or only a little, even not left. This is different from the production of wood pellets from energy plantations because it guarantees a better supply of raw materials. But cultivation and harvesting technology must also be mastered properly to be able to better guarantee the supply of raw materials to the plant. For plants, guaranteed supply of raw materials is vital. The plant will immediately close if there are no raw materials to process. Wood pellet plant generally have a large warehouse of raw materials, which also functions as a buffer for their production.

Next is the mastery of wood pellet production technology itself. To maintain the quality and quantity of wood pellets that are as expected, the mastery of production technology is absolutely necessary, in addition to handling the product to the shipment. The critical points of the production process such as particle size, level of dryness, pelleting and cooling must be of particular concern. Wood pellet products that can be accepted by the international market almost all must meet two standard requirements, namely quality standards and environmental standards (sustainability). Quality standards are closely related to the technical aspects of the wood pellet itself or its production aspects. While environmental aspects are closely related to the origin of raw materials, and various environmental aspects that make wood pellet raw materials sustainable, and for more details can be read here.

The momentum of the energy plantation is predicted to not be long anymore, even Sri Lanka will soon produce wood pellets from the gliricidae energy plantation of 150 thousand tons/year or more than 10,000 tons/month, for more details, please read here. Gliricidae as well as calliandra are a group of leguminous plants (leguminoceae) and gliricidae are more popular and have been planted by the community since tens or even hundreds of years ago which is usually for hedgerows and leaves for animal feed. While the red calliandra, which may have been planted by the community for hundreds of years, is generally only for high areas. For a more detailed comparison of calliandra and gliricidae plants, please read here.

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.

Startup Business Based on Energy Plantation

Startup business is a trend today and not a few, especially young people who are very interested in this business pattern. Information technology in the form of the internet has made it easier to run the startup business. Today we can see that with this startup pattern a number of large companies have existed and stood by selling their products and services. Innovative products that can provide accurate solutions to the various problems that make the company exist and continue develop. But it turns out that running and developing a startup business is also not easy and without obstacles. The fact is that up to now the possibility of startups appearing and being able to survive is only 8%, meaning that out of 100 startups, only 8 startups can last until the second year. Even if it is counted until the fifth year, only 2 startups can survive. But the fact above is not an obstacle so that it decreases the enthusiasm to continue pursuing the  startup business. On the contrary, it becomes an encouragement about the need for knowledge and sufficient provision to even improve the condition.

Similar to business in general, a startup business will always be able to survive and develop if it continues to be needed by consumers. There are a number of fundamental commodities that will always continue to be needed including food and energy. Food and energy needs are always directly proportional to the human population. Renewable energy, especially biomass-based, which is also one of the focuses of this blog, has bright prospects in the future. Energy plantations can be the basis for a startup business. Energy plantations beside having great benefits for the environment, they also have economic and social benefits. In addition to the fact that there is currently no energy plantation implementation that has yet to work professionally, it needs acceleration. In the early stages of startup, it can focus on commodities that are easy and needed by the market, such as the scheme below.

Startup Business Based on Energy Plantation Phase I

Energy plantations have a number of outputs that can be commercialized or sold, namely wood for wood pellets, leaves for animal feed and flowers for honey production. A number of outputs or yields will clearly maximize the benefits of the energy plantation. The extent of idle land, critical land and a number of unproductive land that reaches tens of millions of hectares is a challenge for the implementation of the energy plantation. The more land is utilized and the higher the level of profits obtained, of course, the more investors invest in this sector. The meat self-sufficiency program from domestic production is also increasingly helped and can be accelerated by forage from the leaves of the energy plantation. The energy plantations use plants such as leguminoceae (legumes) such as calliandra and gliricidae, with roots that are symbiotic with azetobacter microorganism so that it can bind nitrogen from the atmosphere making the leaves rich in protein to become nutritious feed for livestock.

Startup Business Based on Energy Plantation Phase II

In stage 2 such a scheme above the benefits can be further increased. This is because the company does not only produce raw materials used by other industries but furthermore, that is, produce finished products that are ready for consumption. Even so the length of the chain of production processes indeed makes the responsibility of producers increasingly large and complex. Startup businesses that have experienced or have surpassed phase 1 schemes will usually find it easier to run phase 2. The market for this stage is also mostly for exports because up to now the domestic market is not ready, for example wood pellets for fueling fluidized bed technology combustion. PKS (palm kernel shell) are now widely used for the power plant, and because availability is also limited it will be very possible in the future era of wood pellets from the energy plantation as a replacement.

The market for biomass fuels, especially PKS and wood pellets is very open especially in the export market. Japan and Korea are the biggest consumers of biomass fuels today for the Asian region, for more details about the characteristics of the Japanese and Korean markets can be read here. Whereas Europe with the RED program (Renewable Energy Directive) II in 2030 targets that almost 1/3 of energy consumption derived from renewable energy with biomass fuel gets a portion of 80%. The amount is certainly very large, with the current conditions Europe still needs around 5 million tons of wood pellets even though RED I, which applies until 2020, only targets 20 percent of energy consumption from renewable energy and biomass to get a portion of 80 percent.

Container Still Become the Main Choice of Wood Pellet Export in Indonesia?

Buyers' satisfaction for getting goods on demand, undamaged and defective, is an important factor in the sustainability of a business so buyers continue to repurchase and repeat orders, by making or renewing existing contracts, even by increasing their purchasing capacity. This also applies to the wood pellets business. Attempts to get goods that order for the buyer one of them by keeping the goods along the journey from various damage is important one by choosing the packaging or the appropriate wood pellet delivery or the type of delivery. Almost all Indonesian wood pellet exports today use containers with wood pellets in jumbo bags and then arranged inside the container. Some use sack packs then place them in containers as well. There is also a way of bulk or not packed in jumbo bag or sack but still in containers. The use of containers is chosen because, firstly the export wood pellet volume is not large yet, second are not yet available adequate supporting facilities for large quantity wood pellets export with bulk shipment.

Wood pellets is a very sensitive product with water, so protection or keeping it out of water should be done to maintain the quality of the wood pellet. By placing the wood pellet in a container then protection from water such as rain water can be done, so it is still used as the main choice. Then how to export wood pellets in large quantity routinely done every month? Need extra effort at this time if want to use bulk shipment, especially for protection from water. Especially in the rainy season. Rainfall intensity in Indonesia is quite high compared to other countries in general, namely, an average of 2700 mm / year or three times higher than the world average of only 900 mm / year. Indonesia's rainfall is higher than India (1,080 mm), America (715 mm), China (645 mm), Brazil (1,750 mm), Argentina (591 mm) and even Thailand (1,625 mm). Only two of our neighbors are able to surpass the Indonesian rainfall of Malaysia (2,875 mm) and Papua New Guinea (3,140). While countries in the Middle East in general have only a small rainfall such as Jordan (111 mm), Qatar (74 mm), Saudi Arabia (59 mm) and Egypt who only get 51 mm rainfall per year. So if bulk shipment of wood pellets will be done then in the dry season will be easier because water protection is easier to do. In comparison we will see shipping of palm kernel shell (pks) which is also biomass fuel has been exported abroad especially with bulk shipment.

Palm kernel shells are not as sensitive as wood pellets or pellets fuel to water, so the handling is also not as difficult as wood pellets. There are three main things that become the main parameters of palm kernel shells that is water content, calorific value and impurity. Related to the moisture content because the palm kernel shells is not damaged by water but only keep it from getting too wet, while wood pellet which is an industrial product of woody biomass compaction (biomass densification) will be damaged and even destroyed by the presence of water in certain quantities. Mechanical interlocking that occurs during the compaction will decompose and loose due to the presence of a lot of water so the wood pellets destroyed. In shipment of palm kernel shells from stockpile locations to export ports, the use of trucks or barges is common and sometimes only sealed with less dense plastic. In wood pellet closure with plastic when heading to the carrier vessel can also be done but if not tight enough will be prone to water especially in the rainy season, plus if loading to the ship is done in the middle of the sea (transhipment) because the ship can not lean on the port like usually done in Kalimantan.

The difference in the tolerance level of water avaibility between the palm kernel shell and wood pellets, has implications for handling and even the equipment used. Weather factors (such as storms) and density loading traffic port add to the difficulty of loading wood pellets onto the vessel. This makes shipping large quantities of wood pellets with bulk shipment still difficult to be done, so shipping with containers are still the main choice in Indonesia. 

Wood pellet terminal in Canada

Wood pellet loading from silos into the ship

Cement terminal at seaport

Cement loading from silos into the ship

Another reference that we can refer to is the bulk cement shipments. Cement is a product that is also very sensitive to water, in the presence of water then the cement will clot so it becomes unusable, so protection against water is absolutely necessary. Cement distribution lines to their bulk shipment are all protected from the entry of water. In the highways we can easily find large trucks carrying bulk cement pass through, then in a number of ports are also built cement terminals in the form of silos or bin like high towers. When wood pellets production reach massive scale, the infrastructure or supporting equipment is also almost the same as cement and it is now also we can see in wood pellets producing countries like America and Canada. On the receiving port side or port of destination the shipment of adequate equipment is also required to handle the unloading of the wood pellets. For comparison, large quantities of feed pellets will also require almost the same equipment for bulk shipment. So whether the biomass fuel such as wood pellets become waterproof (hydrophobic) like coal? The answer can be with torrefaction technology so the product become torrefied wood pellet. Torrefaction will be discussed in more detail next writing. Insha Allah.