Empty oil palm fruit bunches (EFB) are the most abundant solid waste from palm oil mills. Efforts to utilize them have also attracted considerable attention. With hundreds of tons of waste produced daily, it certainly presents a challenge, but also an attractive opportunity. Considerations of investment size and potential profits are key. EFB pellet production is an attractive option given the need for biomass fuel for decarbonization, renewable fuels, and carbon-neutral fuels to achieve Indonesia's Net Zero Emissions (NZE) by 2060.
The global population of palm oil plantations, with Indonesia and Malaysia leading the way, makes processing this material highly attractive. Many machinery companies have focused on empty fruit bunch processing, particularly through size reduction and pressing, but few have focused on producing EFB pellets. This is because empty fruit bunches, with their high fiber content, are more difficult to process than wood materials like sawdust or other agricultural waste biomass.
Selecting the right, reliable, and experienced production machinery supplier is key to success. Performance guarantees, such as agreed quality and quantity targets, as well as timely machine manufacturing, installation, commissioning, and production, are indicators of the supplier's reliability. A track record is also an important consideration. Furthermore, the high potassium content of empty fruit bunches (EFB) poses a challenge in producing boiler-friendly fuel, particularly for pulverized combustion, commonly used in power plants.
And with the increasing number of companies producing EFB pellets, there will be competition for the supply of empty fruit bunches raw materials, such as PLN EPI (Energi Primer Indonesia) which signed a Memorandum of Understanding (MoU) with PT Biomassa Energi Group (BEG) and G7 Group SP.Z.O.O from Poland which was developed jointly will start operating in February 2026, with an initial production target of 120 thousand tons per year, and will be followed by five additional factories with similar or larger capacities, more details read here.
In Japan, with approximately 290 biomass power plants, the transition to BECCS should be faster, but it's just a matter of policy and regulation. Installing CCS (Carbon Capture and Storage) units at biomass power plants makes the plant's operation carbon-negative, or carbon dioxide removal (CDR) mode. The amount of carbon captured and stored, separating it from the atmosphere, can earn carbon credits that can be used for CCS operations at biomass power plants. Decarbonization to achieve the 2050 Net Zero Emissions (NZE) climate targets and the Paris Agreement are the driving force.
And because biomass power plants always require biomass fuel for their operations, this presents an opportunity for Indonesia to supply wood pellets and palm kernel shells (PKS). Power plants in Japan, most or the majority of biomass fuel comes from imports, such as the Kanda Biomass Power Plant (Kanda Biomass Energy) in Kanda City, northeast of Chiyoda, Tokyo. Kanda Biomass Energy uses three types of biomass: wood pellets (60 percent), palm kernel shells (PKS) (30 percent), and wood chips (10 percent). Wood pellets are imported from British Columbia, Canada and Vietnam, palm kernel shells (PKS) from Indonesia, and wood chips are imported locally from northern Kyushu. This facility consumes approximately 170,000 tons of wood pellets, then 120,000 tons of palm kernel shells (PKS), and 60,000 tons of wood chips per year.
Biomass power plants in Japan generally use fluidized bed combustion (FBC) technology in their boilers. The reasons for using this technology are higher fuel flexibility, high efficiency due to good mixing, relatively low combustion temperatures, which minimize the problem of ash deposits due to melting and the use of excess air. It also further increases efficiency and reduces flue gas production. FBC technology is suitable for large capacities above 20 MW. Over time, this technology has been divided into two types: bubbling fluidized bed (BFB) and circulating fluidized bed (CFB). Generally, the differences between the two are not significant, such as fuel size, unit construction, and air-fuel ratio. Palm kernel shells (PKS) are more suitable for CFB power plants because they are less than 4 cm in size. Power plants in Japan, in particular, that use PKS or palm kernel shells as fuel because they use CFB technology.
With relatively low operating temperatures of 650-900°C, ash problems can be minimized. Certain biomass fuels sometimes have high ash content and ash chemistry that can potentially damage the generating unit. Furthermore, fuel cleanliness is also very important, this is because technically certain impurities such as metals can block the air pores in the perforated plate of the FBC unit, even though air, especially oxygen, is absolutely necessary for the combustion process and also maintains the fluidized fuel bed condition. These fuel cleanliness requirements must be met by the supplier or seller of the biomass fuel. Therefore, the buyer requires the amount of impurities (impurities/contaminants) that can be accepted is very small, namely around less than 1%. PKS cleaning is done by sieving either manually or mechanically. For more details on biomass fuel cleanliness issues can be read here.
The demand for biomass fuel is predicted to continue to increase. And biomass power plants continue to expand, with an estimated 6 GW of additional power plants projected to be installed in Japan by 2030, with an installed capacity of 7.3 GW by 2024. In fact, 11 new power plants are scheduled to come online by 2025, increasing annual biomass fuel demand by approximately 1.1 million tons. If Indonesia could also supply wood pellets to Japan by maximizing forest residue, sawmill waste, or other wood processing industry waste, that would be extraordinary.
As an estimate of forest waste utilization, for example, a production forest with an area of 200,000 hectares (approximately 2,000 km2) and because it is located in a tropical area with an average woody biomass growth rate of 20 tons/hectare/year, then the forest will produce 4,000,000 tons/year of wood every year from new growth. An area of 200,000 hectares may seem very large, but with Indonesia having almost 70 million hectares of production forest, an area of 200,000 hectares is only 0.29%.
For example, we set the default setting for wood utilization from production forests: 35% for building materials, furniture, flooring, etc., 30% for paper, tissue, and packaging, with 5% of the harvested wood remaining in the forest. Furthermore, 15% of sawmill waste (sawdust, chips, etc.) is used for wood pellet production, and the remaining sawmill waste is sent to pulp and paper mills and engineered wood industries.
And it is estimated that 35.3% of the 3.8 million tons/year of wood waste annually goes to wood pellet factories (approximately 1.34 million tons annually). In some locations the actual percentage is much lower because paper mills and engineered wood industries use more raw materials with the same raw materials as wood pellet factories. Therefore, in general, wood pellet factories are not located in locations that already have demand or existing use for pulp and paper and engineered wood industries. With the high water content, drying is necessary for wood pellet production, so the estimated wood pellet production is 650,000 tons/year. With the size of a handymax vessel that can carry 25,000 tons/shipment, this means 26 shipments are needed to Japan each year, or with a panamax vessel that can carry 50,000 tons/shipment, this means 13 shipments to Japan each year.
Competing to lower the global temperature is a good thing. Competing in good deeds is highly encouraged in Islam. The negative impacts of global warming can be felt on land and at sea, and therefore must be minimized. This is why various parties involved in this effort should collaborate and synergize to achieve this goal. The business aspect of this activity should be a secondary priority, so that a spirit of good deeds, collaboration, and synergy will be fostered. Technically, strategic sectors that are the main causes of global warming are an important priority to address, although other, more pressing matters must also take precedence.
There is an excess concentration of carbon (CO2) in the atmosphere that causes the earth's temperature to rise due to the greenhouse gas effect, but on the other hand there are billions of hectares of land on earth that need carbon in the form of biochar to increase soil fertility as well as to absorb CO2 in the atmosphere with carbon sequestration / carbon sink. If these two things can be synchronized, it will be an effective solution to reduce the earth's temperature. In 2024, CO2 emissions from fossil fuels were recorded at around 36.3 giga tons (36.3 billion metric tons) and the latest CO2 concentration according to the Mauna Loa observatory in Hawaii reached 429.25 ppm (on June 24, 2025). Meanwhile, on the land side, globally an estimated 1.66 billion hectares of land have been degraded due to human activities such as deforestation, overgrazing, mismanaged irrigation, and excessive use of chemicals.
Biomass fuel, produced by producing wood chips and wood pellets, or biofuel, is a carbon-neutral renewable fuel or source, thus complementing biochar. Wood chips and wood pellets, or biofuel, do not increase CO2 emissions, and biochar absorbs CO2, acting as a carbon sink (carbon sequestration), or carbon-negative.
Calliandra energy plantations as the name implies are indeed prioritized or for the main purpose of producing energy from biomass, either wood pellets or just wood chips. This is because wood is the main product of the energy plantation, while leaves and flower nectar are by-products or are considered waste from the wood pellet or wood chip business. However, if the use of leaves for animal feed and flower nectar for honey production has an economic value that approaches or even exceeds the wood pellet product, then it will be a different story. Calliandra leaves, like indigofera leaves and glicidia / gamal leaves, have a high protein content, while this protein element is the most expensive source of nutrition of all the elements in animal feed products, while calliandra honey is one of the best quality honeys compared to other honey products such as acacia honey, kapok honey, rubber honey and so on.
Synchronization between honey and wood production is very important in the energy plantation to maximize profit. In honey production, the first time the calliandra flowers and the next flower cycle are very important. Don't let it be that just because of ignorance of the flower cycle, many benefits that should have been obtained are lost. In addition, for sustainable and optimal honey production, not only calliandra nectar is needed, but also a number of certain plants as support, both for additional bee feed and for making beehives. When all that is available is calliandra nectar, honey production will be maximized but will not be sustainable because the bee colony will shrink and then disappear. This is the importance of plantation engineering with a number of species or types of certain plants if honey production is also an important product in the calliandra plantation-based business.
Calliandra leaves in abundance will automatically be obtained when the calliandra trees are cut down or harvested. The calliandra leaves need to be separated from the wood and twigs to be used for animal feed. Animal feed products from calliandra leaves can be in the form of fresh leaves or processed leaves in the form of pellets, or hay. This makes it possible to have a leaf pellet factory in addition to the wood pellet factory. With an estimated leaf volume of 1/4 of the wood but the price of leaf pellets is around 3 times the price of wood pellets. So the profit from utilizing leaves into pellets (leaf pellets) is very large, estimated at 1/2 to 3/4 of the wood pellet turnover. This is certainly a serious consideration and cannot be ignored.
A comprehensive understanding of calliandra plantations for energy, food and feed is indeed very important to maximize profits from calliandra plantation-based businesses. This will encourage the calliandra energy plantation to grow further. In addition, the legality aspect and land selection for the location of the calliandra plantation. This is because, especially for wood pellet products in general, it is for export orientation and especially for Japan and Europe, environmental or sustainability certification is very important and even required so that the legality aspect (which is clear and clean) and land selectivity according to its designation including the history of the land are also very important. So optimizing calliandra energy plantations for energy, food and feed is possible if the terms and conditions are met.
Along with the global decarbonization trend, energy plantations are increasingly developing in Indonesia. The creation of these energy plantations has the main purpose of producing biomass fuels such as wood chips and wood pellets. Wood chip production because it is easier and the production equipment is easier and cheaper is usually done before wood pellet production and for more details can be read here. In addition to the use of wood as the main product of energy plantations, by-products that can be produced from energy plantations are animal feed from the use of leaves and honey from honey bee farms. And with the utilization of all parts of the tree (whole tree utilization), the energy plantation-based business is not only more profitable, but can also remain sustainable.
The honey production that can be produced from the development of energy plantations will also be very large, namely tons or even hundreds to thousands of tons in proportion to the area of the energy plantation. Moreover, the plants cultivated are red calliandra whose nectar will produce one of the best quality honey. Regarding the development of the energy plantation, even API (Indonesian Beekeeping Association) responded optimistically to the development of the energy plantation, because in the next 5 years it is targeted that honey production will increase by 300% so that the import of tens of thousands of tons of honey from China can be reduced and even be sufficient, more details read here. In addition to honey, several derivative products will also be produced from honey bee farming, namely royal jelly, bee pollen, bee wax and bee venom which also have many benefits. The motto "Gertakanlah" namely the Bee Feed Planting Movement is very much in line with the development of this energy plantation.
But this condition is different from the world of animal husbandry, especially ruminant livestock, namely goats/sheep and cattle. In fact, Indonesia's meat needs are also very large, most of which are still met by imports. Unlike beekeeping which is responsive to the development of the global decarbonization trend, namely more specifically with the energy plantation, the world or livestock industry players have not responded to this, even though the production of feed from this energy plantation will also be very large. Even the main element of animal feed from red calliandra leaves is protein and protein is the most expensive element of animal feed nutrition. In addition, with this livestock, it is also possible for integration to occur as in the diagram above. Integration will provide optimal benefits and production becomes efficient, thus providing even greater benefits.
Many biomass energy entrepreneurs start their business with wood chip production. This is quite reasonable because in addition to the easy production process, cheap investment in equipment and easy market. But over time to increase profits, wood pellet production becomes an option. Technically, wood pellet production requires a series of equipment more than wood chip production, even wood chip production can be one of the stages of the overall wood pellet production process, namely the size reduction stage, especially if the raw material for wood pellets is from logs or pieces of wood. The wood pellet production process is more complex, production equipment is more expensive but also provides better profit expectations. This is certainly a driving force in itself and is considered commensurate between the costs incurred and the profits obtained.
Wood chip and wood pellet products also have the same use, namely for fuel or energy sources. With experience in the wood chip business, it will also provide experience in the dynamics of the renewable energy business, especially biomass energy. Along with the high awareness and demand for renewable energy, especially energy from biomass, a number of fossil energy companies have begun to develop renewable energy as an effort to the energy transition. And a justice energy transition with gradual implementation is the best route, for more details read here. In addition, wood chip production that requires a certain particle size will also produce waste (undersize) that can be used for wood pellet production, for more details read here.
Energy plantations are starting to develop and large-capacity wood pellet production is emerging in line with the development of these energy plantations. It could be that now is the right momentum as predicted several years ago by the author in the following article. It is also possible that the Covid-19 era which has lasted for about 3 years has slowed down this momentum. The vast area of industrial plantation forests (HTI) in Indonesia allows for the creation of energy plantations for large-capacity wood pellet production along with additional products such as animal feed and food (honey). The production of wood pellets as biomass fuel or carbon neutral fuel is mainly made or produced in the context of the energy transition towards the net zero emission era.
Viewed from the business side, the production of wood pellets is demand driven because efforts to achieve the net zero emission target require industries, especially coal-fired power plants, to carry out gradual decarbonization through cofiring biomass fuel (wood pellets) with coal. The target, which is getting closer in time, with various efforts that require planned programs and large costs, does require serious and sustainable efforts. Not only in the power generation industry, especially coal-fired power plants, but also other industries such as the iron and steel industry. Coal-fired power plants contribute 40% of CO2 concentration globally, while the iron and steel industry contributes 9% globally.
In the current power generation industry, more than a third of global electricity production still uses coal. That portion must drop to 4% by 2030 and 0% by 2040 if the world is to limit global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit) and prevent the devastating impacts of the climate crisis. Developed countries should be able to reach zero coal faster because they have a stronger financial position than developing countries, most of which still rely on coal. The world has 6 years from now to reduce coal use in power generation to less than 4% by 2030, and a number of countries have taken rapid steps to eliminate coal use, which can be read here.
Meanwhile, in the decarbonization of the iron and steel industry, the fact is that currently it is still far from achieving this goal because the construction of blast furnaces - basic oxygen furnaces (BF -BOF) is still being carried out, which should be EAF (Electric Arc Furnace) or currently only around 30% globally the iron and steel industry uses this EAF. Even the International Energy Association (IEA) highlighted this critical issue to achieve the Paris Agreement's net-zero target by 2050. The CO2 intensity in this industry has only decreased slightly so that the use of renewable energy is becoming increasingly important and accelerated.
Currently, large energy plantations have begun to be created in the context of the energy transition. The main production of energy plantations is wood pellets which can be said to be carbon neutral fuel. Almost none of these energy plantations are designed for charcoal production, even though the need for charcoal is also projected to be very large. The difference is that wood pellets will be used in power plants while charcoal is for the iron and steel industry. The production process for wood pellets is biomass compaction / densification while charcoal is carbonized or pyrolysis. In the future, a number of these energy plantations could be designed for wood pellet production while other energy plantations are designed for wood charcoal production. Given that the agreed time target for net zero emissions is not long away, the creation and utilization of energy plantations for these things will automatically not be long away.
Raw materials are a vital aspect of a production activity. No raw materials means no production. Likewise in the wood pellet industry. The availability of raw materials is absolutely necessary for the continuity of the wood pellet business. To maintain the supply of raw materials, wood pellet factories must have reliable sources of raw materials. Currently, most or even all wood pellet factories on the island of Java rely on sources of raw materials for wood pellet production from wood waste, especially sawdust from sawmills and wood processing industries.
Currently, coal-fired power plants in Java are running a coal cofiring program with biomass to reduce carbon dioxide emissions or decarbonization. The use of coal in these power plants will be reduced while the use of renewable energy, especially biomass, is increased. The biomass currently used for cofiring is sawdust with a volume of up to hundreds of thousands of tons per year. A very large amount. Wood pellet factories that use sawdust as raw material must compete with the cofiring program in these power plants. This competition increases the price of sawdust because the supply remains the same but demand increases. Disruptions in the supply of raw materials in these wood pellet factories result in disruptions in production and automatically their business aspects.
With these conditions, large-capacity wood pellet production in Java Island becomes less attractive. In fact, the portion of biomass use, especially sawdust, will continue to increase along with the decarbonization program to achieve net zero emissions by 2060. This is increasingly burdensome for wood pellet factories that rely on raw materials from buying sawdust. Wood pellet factories in Java can run well if the availability of raw materials can be maintained and this can only be realized in two ways, namely first using their own raw materials, this can be done by sawmills and wood processing industries that utilize their own waste for wood pellet production, and secondly with raw material sources from energy plantations. Energy plantations that are specifically dedicated to wood pellet production will be able to maintain the stability of the supply of raw materials for wood pellet factories. Wood pellet factories can partner with Perhutani for the second point above.
Coal is a fossil fuel which is one of the main causes of greenhouse gases, especially CO2, which causes global warming and climate change. Even though this fuel is cheap and available in abundance in Indonesia, its use will be increasingly reduced over time to achieve safe conditions for the earth. Indonesia is the 5th largest coal producer in the world with production of around 570 million tons per year with reserves reaching 38 billion tons, the main production of which is on the islands of Sumatra and Kalimantan. A large coal company in Indonesia can produce 50 million tons of coal every year.
Policies to reduce consumption of fossil fuels, especially coal, also continue to be implemented globally. For Asia, for example, Japan and Korea with their Feed in Tariff and Renewable Portfolio Standard (RPS) are leading the way in the use of renewable energy, especially wood pellets. Meanwhile in Europe, with the Renewable Energy Directive II (RED II), renewable energy is targeted to reach 32% by 2030, biomass fuel is predicted to reach around 75% of the share of renewable energy and the target is that coal will not be used completely by 2050. Germany has announced that it will not use coal. By 2038, the UK is even targeting no longer using coal for its electricity production starting October 2024. North America, namely the United States and Canada as members of the G7, are also committed to reducing coal consumption, in 2018 Canada even announced regulations to no longer use coal for electricity generation by 2030. On the other hand, coal power plant construction projects funded by China in various countries have collapsed. Plus, the G7 countries (Canada, France, Germany, Italy, Japan, England and the United States) are aggressively blocking the use of coal. Countries that still support coal use, such as China and Indonesia, are increasingly isolated and could face more pressure to stop such activities.
Seeing the world energy trend which is starting to decarbonize, many coal companies are then developing new businesses in the renewable energy sector. A number of coal companies are known to have planned to produce large capacity wood pellets and also become palm kernel shell (PKS) exporters. And seeing the global trend in the use of renewable energy which continues to increase, especially biomass fuel, it is possible that in the near future they will immediately execute this plan. With the large profits from the coal business, developing new businesses should also be easier.
For these coal producers whose business sector is in the energy sector, marketing these biomass fuel products should not be difficult. Wood pellets and palm kernel shells / pks can be used as fuel in power plants just like coal. In fact, a number of coal-fired steam power plants also use certain amounts of biomass fuel which is mixed with coal, namely by cofiring. In fact, biomass fuel can be used 100% in certain types of technological power plants such as stokers and fluidized beds. As both products for energy, more specifically solid fuels with the same users, it is indeed easier for coal companies to develop into the wood pellet industry and export palm kernel shells / pks.
In contrast to palm kernel shells / pks which is waste or by-product from palm oil mills or CPO mills which are obtained by collecting from palm oil mills, wood pellet production for large capacities requires a stable and sustainable supply of raw materials with one of the best options being wood from energy plantation. Energy plantations with a certain area need to be created according to the wood pellet production targets to be achieved. Post-mining land can be reclaimed for energy plantations. And for coal companies developing renewable energy also gives a positive image because it contributes to the decarbonization program and if in time the coal business has to be reduced or even stopped, they will be ready with a new business in the form of renewable energy.
With its position on the equator so it has a tropical climate, it will receive sunlight all year round. Energy from sunlight should be utilized optimally in the current era of decarbonization. So that solar energy can be used at any time, this energy must be stored. This is like a battery mechanism for storing energy, so that the energy does not just pass through and disappear. Storing and converting solar energy has been done naturally since life existed, namely in plant biomass. With photosynthesis in plants, solar energy with water and CO2 is converted into biomass in the form of wood, fruit, leaves and various parts of these plants as well as O2 for us to breathe. Solar energy does not just pass and disappear but is stored in the plant as an energy source or "battery" that can be used at any time.
With this paradigm, of course efforts to maximize energy storage in "green batteries" must be maximized as an effort towards low or carbon neutral fuel. With the largest land area in Southeast Asia, of course efforts to maximize "green batteries" become more important and strategic. The use of fast growing species and short rotation coppice will be very suitable for converting and storing solar energy. Moreover, in tropical climates the wood harvest is also faster than in sub-tropical countries or cold areas, due to the abundance of solar energy.
The potential land area for making "green batteries" is very large, reaching tens of millions of hectares. In addition, reclaimed land reaches millions of hectares, more details can be read here. The "green battery" is in the form of an energy plantation whose wood is used for the production of wood pellets. In the form of wood pellet products, biomass energy becomes easier to store and use at any time. Unlike intermittent solar or wind or water power plants, biomass fuel in the form of wood pellets is not like that. It can be used according to your request and desired target, making it more practical and reliable. The reasons why the "green battery" in the form of energy plantations has not been developed can be read here.
Apart from "green batteries" from energy plantations, "green batteries" can also come from production forests in general. In these production forests, the main product is wood which can be used for various purposes such as building wood, furniture, plywood, flooring and so on. The wood industry waste is then used for the production of wood pellets. Wood pellet production basically has to use wood waste or wood that worth as wood waste such as wood from energy plantations, so that the wood pellet industry is economical and profitable. It is estimated that there is 25 million tons/year of wood waste that can be used for the production of wood pellets In Indonesia. And specifically from the plywood industry alone, wood waste is estimated to reach 5 million tons every year.
It is estimated that the Indonesian wood industry can actually be optimized until its production capacity reaches 91 million cubic meters per year, but in reality in 2022 the forest products industry will only be able to produce 42.19 million cubic meters per year or around 48.7% of its optimum capacity. There are 3 factors that cause the low realization of the wood industry, namely, efficiency of the wood industry, problems related to raw materials and market availability.
Research on batteries continues along with the global decarbonization trend and the energy transition is a necessity to achieve the decarbonization target. Large capacity batteries so that electrical energy produced from renewable energy plants such as wind and solar can be stored is the target of this research. This research costs a lot of money and takes a long time, it is estimated that in the next 20 or 30 years, these large capacity batteries will be available. Meanwhile, currently most power plants use fossil fuels, especially coal. Energy transition efforts at power plants can be carried out by substituting coal for wood pellets. Moreover, as a tropical area, biomass energy can remain as the main energy in the future non-carbon era.
Indonesia's "green battery" must be activated and developed, because apart from its function as an energy source, the "green battery" is also a CO2 storage or carbon sink. As long as the amount of wood harvested is smaller or the maximum is equal to the growth of the energy plantation or "green battery", the amount of CO2 absorbed by the plants does not decrease or the CO2 released into the atmosphere does not increase, and the same goes for production forests in general. When at a certain age the growth becomes saturated and begins to decline in CO2 absorption, meaning that the forest cannot permanently store CO2 in a fixed volume, so it needs regeneration/replanting. Meanwhile, in energy plantations, due to the characteristics of the plant species, regeneration/replanting is not necessary every time it is harvested, but can be done decades later. And furthermore, the use of carbon capture and storage (CCS) technology in power plants that use 100% of their fuel from wood pellets means that the CO2 produced is not released into the atmosphere or is carbon negative, which reduces the concentration of CO2 in the atmosphere.
Post-mining reclamation is the obligation of mining companies / IUP (Mining Business License) holders so they must prepare funds for this. Apart from reforesting mining areas in forest areas, other forms of reclamation are more flexible because there are many types, but the aim can provide economic, social and environmental benefits. If the mining company does not carry out reclamation, it will receive heavy sanctions, namely a fine of up to 100 billion rupiah. Post-reclamation business or activity management is also flexible according to the agreement as long as it does not conflict with the above objectives.
The volume of wood waste from the woodworking industry in Indonesia is estimated to reach 25 million tons every year. Every wood processing will produce waste such as sawdust, wood shavings, wood chips and so on, the volume of which is around 40% of the raw materials used. However, there is still a lot of waste that has not been processed so it pollutes the environment. Meanwhile, the development of the Indonesian timber industry continues to increase due to high export demand, even though actual realization of the timber industry is still low.
It is estimated that the Indonesian wood industry can actually be optimized until its production capacity reaches 91 million cubic meters per year, but in reality in 2022 the forest products industry will only be able to produce 42.19 million cubic meters per year or around 48.7% of its optimum capacity. There are 3 factors that cause the low realization of the wood industry, namely, efficiency of the wood industry, problems related to raw materials and market availability.
The low efficiency of the woodworking industry is due to the use of old machines or traditional methods for production. Meanwhile, problems related to raw materials are caused by the reduction in forest areas due to the large amount of development that causes forest land to change its function. Efforts to maintain a stable and sustainable supply of wood raw materials need to be made, including land rehabilitation programs and coaching for community forest farmers. National mapping of wood potential also needs to be carried out so that industry can obtain information regarding the supply of raw materials needed. Market availability is also an important factor in the development of the timber industry, so the ability to access information and identify market aspects, both domestic and international, is needed.
As the wood industry increases, wood waste also increases. An environmentally conscious industry certainly pays great attention to waste issues so that ideally it can achieve zero waste. These wastes are raw materials for wood pellets. The need for wood pellets continues to increase in line with the global decarbonization trend. Just as the woodworking industry requires consistency to maintain its products, so does wood pellet production. The consistency of the wood pellet raw material mixture is the key to the quality of wood pellets, including making production optimal.
In large woodworking factories, wood pellet production can be carried out simply by using its own waste, so that apart from solving the waste problem according to the zero waste concept, it can also be used as a new business development. Meanwhile, in the small - medium woodworking industry, because there is insufficient wood waste, some wood waste as raw material for wood pellets needs to be sourced from other places. A wood pellet factory can also be made independently, namely with raw materials that come 100% from other people's woodworking factory waste, meaning that the wood pellet factory is not owned by a wood processing industry. So basically a wood pellet factory is a factory or installation for processing wood waste that produces products with high selling value and is in line with the global decarbonization trend.
Availability of raw materials and
market control are the two absolute main things that must be
fulfilled so that the wood pellet production business can be
sustainable. Investing in expensive equipment will be useless if the
two things mentioned above are not met. In large capacity wood pellet
production, the quality of the production equipment used is very
important. The production goal of achieving large capacity will be
achieved if it is carried out with an efficient and safe production
process so that production costs are low. Production equipment that
is capable of working non-stop 24 hours, easy operation and
maintenance with good performance is vital. Regarding raw materials,
apart from continuous availability, there are 2 important things that
need to be considered, namely the consistency of raw materials and
cheap logistics to the location of the wood pellet factory.
Mapping the potential of raw materials needs to be done well, as well as the wood pellet market. Wood pellet raw materials from one type of wood (single material) are certainly easier than mixed raw materials from several types of wood. This is related to the composition of the mixture, which of course is not a problem if the raw material is from one type of wood (single material) which is homogeneous. To strive for homogeneous raw materials, this can be done by creating energy plantations, while mixed raw materials can be taken from several wood processing sources such as sawmills and so on. Energy plantations that can be multifunctional so that they provide many benefits. This can be done by maintaining a balance between wood productivity for wood pellet production, environmental functions in the form of maintaining erosion and groundwater, and the volume of wood harvested must not exceed the growth rate or be at least the same (carbon balance) and the use of by-products for additional revenue such as utilization leaves for animal feed and honey from beekeeping.
Meanwhile, from a market aspect, a number of requirements also need to be met so that sustainable transactions occur. Apart from technical factors in the form of wood pellet specifications and production volume, non-technical factors such as sources of raw materials related to environmental sustainability are also often required nowadays. Users of wood pellets abroad, especially power plants, are in decarbonization efforts through cofiring programs with coal. Sustainable decarbonization efforts usually require environmental certificates such as FSC regarding the source of the raw materials used. This is to prove that the renewable fuel chain, especially wood pellets, indeed complies with mutually acceptable environmental sustainability standards. There are certain countries that impose long contracts for the purchase or procurement of their wood pellets, but there are also those that choose short-term contracts. The typical buyer or market for wood pellets also needs to be given special attention.
Vast land with a tropical climate with year-round sunshine and high rainfall is a gift from Allah SWT that makes Indonesia a world center of biomass. Biomass-based products such as energy and animal feed are very relevant in the bioeconomy era which is predicted to become a world trend in the near future. Potential optimization must be carried out especially since it is very much in line and relevant to world trends (decarbonization & sustainability) in general and Indonesia's specific national conditions in particular. On the other hand, we can see a number of countries whose majority of their economies depend on fossil energy, especially oil and gas, such as Saudi Arabia and Qatar or the Gulf countries in general, have to change their course to fight to reduce dependence on these natural resources. Efforts for realization/implementation and acceleration should be carried out immediately, even though it is actually a little late compared to other countries in Southeast Asia, especially Vietnam, for more details please read here, but given the potential and future direction of the world economy, of course, besides being urgent, it is also important to do this.
As a reference for the development of the wood pellet industry in Indonesia, we can take the example of a country in North America, namely Canada, especially in the province of British Columbia. The province has the highest concentration or the most wood pellet factories, which are estimated to reach around 70% of the country's production. From the research conducted, it was found that 85% of the wood pellet raw material used was sawmill waste and the remaining 15% was forest waste. And the forest waste can be further broken down into 11% low quality logs and 4% bush plants. So all the raw materials used in the province use wood wastes produced from sawmills and remnants from the forest. The production of wood pellets basically has to use raw materials from wood wastes or wood which are worth the wood waste.
By utilizing these wastes, in addition to overcoming environmental pollution, even sawmill operations become zero waste, it also provides additional income or economic benefits which are quite large in value. Forest wastes in Indonesia such as from acacia plantations have the potential to be used for the production of wood pellets. For example, with an acacia plantation, if every hectare produces 20 tons of acacia wood waste, then with an area of 20,000 hectares, 400,000 tons of acacia wood waste will already be produced. The area of 20,000 hectares of acacia plantations is not too big, this is because there are a number of HTI (industrial plantation forest) concession holders covering hundreds of thousands of hectares, so the volume of wood waste produced is also very large. Acacia forests or plantations in Indonesia are estimated to reach 2 million hectares and almost all of these acacia forests are used to supply pulp and paper mills. Every pulp and paper mill always has acacia forests with an area of thousands of hectares to fill the pulp and paper mill. Acacia wood with a minimum diameter of 8 cm is used as the raw material, while those with a diameter smaller than that are only used as waste. After the tree is felled, a new planting is carried out (replanting).
Wood products come from different parts of the tree, each tree has a
unique potential, depending on a number of factors including the
diameter and straightness of the trunk. In acacia trees trunk diameter
is the main parameter.
Likewise in the sawmill industry, apart from waste in the form of sawdust, wood waste such as wood chips can also be used as raw material for the production of wood pellets. Each stage of the sawmill industrial process will produce wood waste, with varying shapes, sizes, quantities and uses. It is estimated that around 40% of wood waste produced from sawmills is around 40%. Factors such as worker skills, operator experience, equipment conditions and the shape of the wood affect the wood waste produced. Based on the above waste percentages, a sawmill that processes 1000 m3/month of logs will produce a total of around 400 m3/month of wood waste. More detail as in the table below:
Energy plantations are another option and are even an ideal option for wood pellet production. This is because the volume is large and its availability can be guaranteed, rather than collecting the wood wastes. With this energy plantation, raw materials in the form of wood will be obtained which costs as much as wood waste. Thousands to tens of thousands of hectares of energy plantations can be made for this purpose. In addition to wood, which is the main product of the energy plantation, by-products with significant value are leaves for animal feed and honey from beekeeping. Optimizing the utilization of all these trees will provide maximum added value from the use of the land. The regions of Kalimantan, Sumatra, Sulawesi, Maluku and Papua can become centers of wood pellet production such as the province of British Columbia in Canada.
