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Pre-feasibility Study of a Biomass Power Plant Project in Perum Perhutani Area

Pre-feasibility Study of a Biomass Power Plant Project in Perum Perhutani Area - Indonesia

Indonesia has a target to increase the renewable energy share in the energy mix from around 7% in 2016 to 23% by 2025 as stipulated in Government Regulation No. 79/2014. The target is ambitious and requires much effort to explore Indonesia's potential for different types of renewable energy. Indonesia as a tropical country with large forest and agriculture sectors has a huge biomass potential to help in achieving the target.

Indonesia is the largest producer of biomass available for energy purposes in the Southeast Asia region; approximately 60 million tonnes dry matter biomass/year (15 % from forest sources; 85 % from agriculture). The present utilization of biomass for energy in Indonesia only reaches 10 % of the totally available. In 2012, Ministry of Agriculture estimated the energy potential from estate crops at 614,6 GJ/year and from solid forest biomass at 41,8 GJ/year. Biomass energy could be part of the effort to produce electricity in a clean and sustainable way and could provide base load for intermittent sources such as solar and wind.

ESP3 supports development of biomass energy in Indonesia as part of its support to renewable energy under Component 2. In October 2016 ESP3 conducted a biomass study tour to Denmark for relevant stakeholders in Indonesia including two Perum Perhutani (Perhutani) representatives to showcase Danish experiences, solutions, and technologies in the biomass energy sector. After the study tour, ESP3 conducted a follow-up event to gather information from the participants after their return to their institutions and the feedback they had received. Perhutani was one of the institutions which had decided to develop biomass energy.

Perhutani is a holding company in the forestry sector. The company manages 2.4 million hectares of forests area in Java and Madura islands, consisting of 1.7 million hectares of production forest and 0.7 million hectares of conservation forest. It manages its plantation forests based on sustainable forest management principles (FSC Standard).

Perhutani has five subsidiary companies (Inhutani I-V) which manage large industrial forest plantation areas outside of Java. Perhutani and subsidiary companies produce large quantities of wood residues, stemming from conversion of low yielding tree crops to high yielding, from wood harvesting processes (thinnings and clear-fellings) and from wood industries. Every year, more than 2 million tonnes of biomass residues are produced from the Perhutani group's business activities.

In early 2017, Perhutani decided to become a forest biomass-for-energy producer and an IPP (produce and sell electricity generated from forest biomass). The private role in the development of biomass power plant projects is driven by independent power producer (IPP) schemes or excess power transactions. The overall objective of Perhutani's is to develop approximately 130,000 hectares of biomass plantations in Java as fuel stock for a biomass based power plant to be established in Java as well.

Based on the above rationale, Perhutani made a request to ESP3 for technical assistance to the development of a pre-feasibility study for a project to establish a biomass power plant based on woody biomass produced by Perhutani within its forest estate. The project aims to support Perhutani in building a new business model as a biomass energy company and could be a trigger for other forestry companies (both private and public) in order to boost biomass energy development in Indonesia.

The objective of the consultancy is to carry out a pre-feasibility study for the development of a biomass power plant project by Perhutani in Java that will enable the company to produce its own fuel stock and generate electricity for sale to the national grid through an IPP arrangement. The study is expected to define the technical and financial feasibility of selected alternatives to enable Perhutani select the most promising alternative. The study should provide all information needed to subsequently conduct a feasibility study of the project.

The expected consultancy duration is four months, with an aproximate input of 720 man-hours and a maximum budget of DKK 500,000 including reimbursable expenses. The contract is expected to start in June 2017.

Deadline for applications: 13 May 2017, at 18:00 Danish time

The standard application form should be used. Applications not using the standard form may be rejected. Applications received after the deadline shall be rejected.

Download application form herehttp://um.dk/en/danida-en/business/contracts/short/contract-opportunitie/newsdisplaypage/?newsID=34E207C1-6519-4E6A-BC57-FA45BF74FCDE

Name of Programme Officer: Jacob Stensdal Hansen
E-mail address, Programme Officer: This email address is being protected from spambots. You need JavaScript enabled to view it.
Telephone of Programme Officer: +62215761478

Criteria for selection:
A minimum of three and a maximum of five applicants with references best suited for this assignment will be invited to submit a tender


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